• Carriers and drivers who handle transporting and documenting loads should be aware of several terms.

Here are some of the terms carriers and drivers should be familiar with:

Basis of rates — Rates are charges based on the value of the transportation and additional services performed by the carrier. Mileage rates are determined by a fee per mile. Class rates are set by grouping goods into classifications according to characteristics such as density, stowability, ease of handling, and liability.

Bill of lading — A written transport contract between the shipper and carrier. It identifies the freight, whom it is consigned to, its place of delivery, and the terms of agreement.

Carrier — An individual or company in the business of shipping goods.

Cash on Delivery (COD) — When the payment for goods is made at the delivery point. The driver must collect payment before the cargo is unloaded. Policies regarding this vary from company to company.

Collect — Paying of the transportation services is done by the consignee, not the consignor. Payment is collected either on arrival or through a credit arrangement.

Connecting carrier — The carrier who delivers a shipment to an interchange point where goods are then transferred to another company to continue shipment.

Delivery receipt — A receipt signed by the customer receiving the goods indicating acceptance of the goods from the driver.

Demurrage — The detention of a vehicle beyond a specified time. Payment is made to the carrier for this delay.

Dunnage and return of dunnage — Cardboard, lumber, or other material used to stabilize and secure a shipment. It is not packaging. The bill of lading should list the weight of dunnage. Usually there is no charge for dunnage weight. If return of dunnage is specified, the driver must keep the dunnage and return it to the carrier or shipper as indicated.

Duties — Government tax on imports and exports which must be collected.

Freight broker — An individual or company who arranges, for compensation, the truck transportation of cargo belonging to others, utilizing authorized for-hire carriers to provide the actual truck transportation. A freight broker does not assume responsibility for the cargo and usually does not take possession of the cargo.

Freight forwarder — An individual or company that accepts small shipments from various shippers and combines them into one larger shipment.

Interchange — A trailer from one carrier is hauled by another carrier with agreements in place. If equipment is interchanged, a carrier should inspect the trailer and its contents before signing for possession.

Interline freight — Freight picked up from or delivered to another carrier. Drivers and carriers should use the same care when dealing with interline freight as they would when dealing with any other consignor or consignee, including checking for cargo shortage or damage before signing the connecting carrier’s bill of lading or freight bill and refraining from signing the bill of lading or freight bill if the connecting carrier refuses to acknowledge things such as shortages or damages.

Manifest — A document describing the contents of an entire shipment on a vehicle.

Maximum rate — The highest lawful rate that can be charged.

Minimum rate — The lowest lawful rate that can be charged for a specific type of shipment.

Order notify shipment — The payment of goods on an order notify bill of lading. The driver must collect a copy of the bill of lading from the person receiving the goods as payment for the goods.

Originating (pickup) carrier — The carrier who picks up a shipment from a shipper.

Packing slip — A detailed list of packed goods prepared by the shipper.

Prepaid — When the transportation charges are paid for or will be paid at the shipping point.

Receiver (consignee) — The individual or company to whom the goods are shipped or consigned.

Services performed by carrier — A list of services that a carrier performs and the rates for those services. This should include accessorial services and accessorial rates.

Shipper (consignor) — The individual or company originating the order for transport of goods.

Storage and delay charges — Additional charges are made for storage or if the carrier is delayed from making a delivery.

Straight bill of lading — Provides that goods be delivered to the consignee indicated. The consignee doesn’t have to surrender their copy to receive the goods.

Tariffs — Rates placed on transportation charges based on the type of service.

Terminal carrier (agent) — The carrier who delivers the shipment to the consignee.

Through bill of lading — Covers a shipment by more than one carrier at a fixed rate for the entire service.

Value of cargo — Cargo is valued as either actual valuation or released valuation.

• Actual valuation — The actual value of goods shown on the bill of lading when the rate applied is dependent on that fact.
• Released valuation — The value of goods set by the shipper as limits of carrier liability and as the basis of rates charged.

Warehousing receipt — A receipt for goods placed in a warehouse.

Weight and distance — The primary determiner of shipping charges. Rates are expressed in terms of per pound of cargo and per mile traveled.

• There are different requirements for load documentation depending on the type of carrier.
• Documentation is important in the event of an accident or investigation.

For-hire common carriers

For-hire common carriers are carriers that haul cargo or passengers without a contract or master agreement with a customer. They are required to issue a bill of lading for any shipments they transport. (373.101)

For-hire contract carriers. For-hire contract carriers are not required to issue a bill of lading. The claims and liability terms in the contract determine how disputes are resolved. The claims and liability conditions mandated by statutes for bill of lading contracts are not automatically part of motor carriage under contract. Parties to the contract may include statutory claims and liability provisions into the contract carrier agreement or include provisions agreed upon between the parties.

However, in the absence of a clear written contract between the parties defining the terms and conditions of liability, the statutory liability under the bill of lading will become the basis for resolving the dispute. (14101(b))

For-hire exempt carriers

For-hire carriers of exempt commodities, per Administrative Ruling 119, are �exempt� from needing a Federal Motor Carrier Safety Administration (FMCSA) operating authority/motor carrier (MC) number, as long as they transport goods or perform transportation considered exempt by the U.S. Department of Transportation (DOT).

If the carrier is not under a transportation contract with the shipper, and hauling as for-hire transportation, there must be a bill of lading contract for the shipment.

Private carriers

There is no federal regulatory requirement for private carriers to have shipping documentation. However, private carriers should still carry shipping documentation that establishes legal possession of the cargo and shipment information. This shipment information should contain, but is not limited to, a description of the cargo and the origin and destination of the cargo.

Private carriers of hazardous materials are not required to have a bill of lading. However, they are required to have a shipping paper meeting the requirements in 177.817.

Freight forwarders

Each freight forwarder must issue the shipper either a receipt or a through bill of lading, covering transportation from origin to ultimate destination, on each shipment for which it arranges transportation in interstate commerce. Where a carrier receives freight at the origin and issues a receipt with a notation showing the freight forwarder�s name, the freight forwarder, upon receiving the shipment at the �on line� or consolidating station, must issue a receipt or through bill of lading on its form as of the date the carrier receives the shipment. (373.201)

Haulers of hazardous materials

A driver hauling hazardous material must ensure that properly marked, hard-copy shipping papers in compliance with 177.817 are readily available to authorities in the event of an accident or inspection. When operating the vehicles, the shipping papers must be within the driver�s reach and either readily visible to a person entering the cab or in a holder inside of the driver�s door. When the driver is not at the vehicle�s controls, the shipping papers must be in a holder inside of the driver�s side door or on the driver�s seat in the vehicle.

For more information, see Hazardous Materials Shipping Papers.

• Contracts between shippers and carriers must include information about freight charges and liability.

For-hire carriers may provide transportation or service as contract carriers by entering a contract with a shipper to provide specified services under specified rates and conditions. Under contract carriage, a bill of lading is not required; the contract will govern all aspects of transportation of the goods.

Freight charges

The contract must include both the freight charges for transporting the goods and the responsibility for payment of the freight charges. The contract must also specify any other services that will be provided and their cost.

Cargo liability

The terms of the contract may waive the statutory rights and remedies governing liability and loss and damage claims. The shipper and carrier, as parties to the contract, must clearly specify the extent of carrier liability, as well as how loss and damage claims will be submitted, processed, and settled. If the statutory provisions are specifically waived, the transportation may not be later challenged on the grounds that it violated the waived provisions.

Regulations

Regulations and statutory requirements governing registration, insurance, and safety fitness may not be waived in a contract.

Load documentation

When transporting goods under a contract as a contract carrier, a bill of lading is not required. However, the carrier should still have some kind of documentation for the load, such as a manifest, invoice, or packing slip. This enables enforcement to easily verify the load is being transported legally.

• A bill of lading describes the shipment, serves as a contract between the shipper and carrier, and documents evidence of the title of the goods.

The bill of lading is a legal contract for transportation services that binds both parties to all provisions contained in it and to the terms and conditions on the back of it.

The Department of Transportation (DOT) regulations for bill of lading requirements are found in 373.101 and apply to for-hire common carriers who do not otherwise have a contract with shippers. This regulation requires that certain information be shown on the bill of lading, including:

1. Names of consignor and consignee,
2. Origin and destination points,
3. Number of packages,
4. Description of freight, and
5. Weight, volume, or measurement of freight (if applicable to the rating of the freight).

There are three distinct functions of a bill of lading:

1. A receipt issued by a carrier to a shipper for goods received for transportation. It states the place and date of the shipment and describes the goods, their quality, weight, dimensions, identification marks, condition, etc., and sometimes their value.
2. A contract naming the parties involved, the specific rate or charge for transportation, and the agreement and stipulations regarding the limitations of the carrier’s common law liability in the case of loss or injury to the goods. It also lists other obligations assumed by the parties or matters agreed upon between them.
3. Documentary evidence of title to the goods. “Negotiable” bills of lading are made out “to the order of” a consignee and the carrier may only deliver the cargo to the person in possession of this original bill of lading. When a negotiable bill of lading is negotiated, the person to whom it is negotiated receives title to the goods. Non-negotiable bills of lading, commonly known as straight bills of lading, do not convey title to the goods.
   • Straight (uniform) bill of lading: Non-negotiable document used to provide that the shipment is to be delivered directly to the party whose name is shown as consignee. The carrier does not require its surrender upon delivery except when needed to identify consignee. It is clearly marked “non-negotiable.”
   • Order bills of lading: Negotiable bill of lading that consigns the goods “to the order of” the person named. It differs from the “straight” bill of lading because it is assignable and negotiable. This bill of lading is printed on yellow paper to distinguish it from a straight bill of lading. The use of order bills of lading is quite limited in the United States.

As a contract, the bill of lading serves the same purpose as any other contract between two parties. The face of the bill of lading provides for the entry of information required for the transportation of the freight. The reverse side usually contains the terms and conditions of carriage.

However, the bill of lading does differ from the ordinary contract in one respect: The terms and conditions, primarily dealing with claims and liability issues, are prescribed by statute. These terms and conditions are part of the bill of lading contract, whether they are printed on the form or not. Participants in the bill of lading contract are assumed to be familiar with these terms and conditions.

Bill of lading retention period

To satisfy the Federal Motor Carrier Safety Administration (FMCSA) requirements, a non-hazardous material bill of lading must be retained by a motor carrier, broker, household goods freight forwarder, or water carrier for a period of one year from the date of the document, or until any claim or dispute involving the transportation of freight based upon the document is resolved (Part 379).

Bill of lading formats

The straight bill of lading has long been the industry standard. However, there are other acceptable formats in use today. The carrier, who is responsible under the regulations for issuing the bill of lading, may choose the format that the company will use. In the case of a shipper issued bill of lading, the driver should be able to recognize the specific provisions their employer requires. Otherwise, the signature on the bill of lading may bind the carrier to unwanted contract provisions.

• The bill of lading must contain basic information about the load and payment.

Address

The street address of the consignee should always be shown. If the destination is a city of considerable size, the consignee�s full address should always be listed in the space provided. The carrier is only responsible for delivering, or sending notice on arrival, to the address shown on the bill of lading. A post office box will not allow prompt delivery.

Destination

The destination should be accurate. An error or an illegibly written or misspelled destination can cause a great deal of trouble and expense. If there are two destinations of the same name in the same state, the consignee should insert the name of the county to indicate the correct destination clearly.

Date

The date on bills of lading should be the exact date of delivery of the merchandise to the carrier. This can help prevent misunderstandings regarding what rate or tariff applies to the shipment.

Description of goods

The description of the goods covered by the bill of lading should be complete and exact regarding quantity and quality. Other information may be necessary to allow the carrier to classify and properly rate the shipment. The law, both federal and state, requires shippers to furnish the correct description of property to be transported by the carrier. The carrier is also required to use proper and reasonable diligence when determining that the correct description of the property has been provided.

If, through error, the shipper describes the shipment incorrectly, and therefore is subject to a higher rate than the shipper would have been responsible for under another description, a corrected bill of lading may be issued. There are heavy penalties for intentionally describing a shipment incorrectly to obtain lower freight rates and charges.

Special markings and instructions

Special marks shown on the shipping units should be reproduced on the bill of lading. Special instructions (i.e., freezables, transit privileges, pick-up allowances, etc.) should be included.

Payment of freight charges

Carriers may require prepayment of freight charges on certain commodities or on freight consigned to certain points, and they have the right under the law to require prepayment on all freight as long as they avoid discrimination. Generally, it is the option of the shipper to determine who will pay the charges and at what point.

Bill of lading forms must indicate the liability for transportation charges. Some forms require the words �to be prepaid� to be inserted. Other forms require that the �collect� box be checked.

Section 7

The box on the face of the bill of lading referring to �Section 7 of conditions,� sometimes known as the �no recourse clause,� deals with the payment of freight charges. It is fully explained in Section 7 of the terms and conditions, but basically provides:

• That the owner of the goods or the consignee must pay the freight charges, and except where the carriers are lawfully authorized to do so, it must not deliver or relinquish possession at destination of the property until all tariffs and charges on it have been paid.
• The consignor shall be liable for the freight and all other lawful charges unless space provided for stipulating otherwise on the face of the bill of lading has been signed.
• The carrier has the right to require prepayment or guarantee of the charges at the time of shipment.
• If inspection reveals the articles shipped are not correctly described in the bill of lading, the freight charges on the goods that were actually shipped must be paid.

Shippers who leave the Section 7 area blank or unsigned are effectively telling the carrier that if they do not, or are unable to, collect the charges from the consignee, the carrier may return to the shipper (consignor) for payment of the freight charges, even though the terms for payment of freight charges on the bill of lading are collected on delivery.

Whether or not Section 7 is executed has a direct impact on the carrier�s ability to collect freight charges from the consignor when the charges are due and uncollectible from the consignee.

• Carriers must issue freight bills for every shipment that include identifying information about the freight and the charges due for it.
• All parties are bound to the terms defined in the bill of lading.
• Section 7 of the bill of lading determines how payment will be collected.

Every motor common carrier must issue a freight or expense bill for each shipment transported according to the regulations in Part 377.

The regulations provide deadlines for sending a freight bill:

• �Prepaid� shipments � The time period to present the freight bill for all transportation charges is seven days, measured from the date the carrier received the shipment. This time period does not include Saturdays, Sundays, or legal holidays.
• �Collect� shipments � On collect shipments, the carrier must present its freight bill within the time period prescribed above (seven days). There are times when the carrier lacks sufficient information to compute tariff charges at its billing point. In these situations, the carrier must present its freight bill for payment within seven days following the day upon which sufficient information becomes available at the billing point. This time period does not include Saturdays, Sundays, or legal holidays.
• The freight or expense bill issued must include:
  • Names of consignor and consignee;
  • Date of shipment;
  • Origin and destination points;
  • Number of packages;
  • Description of freight;
  • Weight, volume, or measurement of freight (if applicable to the rating of the freight);
  • Exact rate(s) assessed;
  • Total charges due, including the nature and amount of any charges for special service and the points at which such service was rendered;
  • Route of movement and name of each carrier participating in the transportation;
  • Transfer point(s) through which shipment moved; and
  • Address where remittance must be made or address of bill issuer�s principal place of business.

Information presented to any party to the transaction about the actual rate, charge, or allowance for payment must not be false or misleading.

The shipper or receiver owing the charges must be given the original freight or expense bill and the carrier must retain a copy. (Part 379)

Credit period for payment of freight charges

Carriers are allowed to extend credit for the payment of freight charges for periods defined in the regulations. (Part 377) The credit period is 15 days and begins on the day following presentation of the freight bill. It includes Saturdays, Sundays, and legal holidays. Carriers may establish different credit periods in their published tariff rules. These credit periods may not be longer than 30 calendar days.

Rates and tariffs

A carrier without a bill of lading is poorly positioned legally to enforce the terms of its tariffs/rate schedules and its rules for such things as free time and detention, accessorial charges, special services, etc. A bill of lading contains language similar to the following:

• �Received, subject to individual determined rates or contracts that have been agreed upon in writing between the carrier and shipper; if applicable, otherwise, to the rates, classifications, and rules that have been established by the carrier and are available to the shipper, on request, and all applicable state and federal regulations.�

As this indicates, a carrier�s rates and rules regarding the transportation being provided are part of the bill of lading contract, incorporated by reference, binding the parties to these provisions.

For-hire common carriers are required to have a written or electronic copy of the rate, classification, rules, and practices upon which any rate applicable to the shipment or agreed to between the shipper and carrier is based. They are also required by statute, and as stated on the bill of lading, to provide a copy of the tariff to the shipper upon the request of the shipper. (13710(a)(1))

Note that household goods carriers are required to give actual notice that the tariff is available for inspection in its bill of lading, or by other notice to individuals whose shipments are subject to the tariff. Without providing this notice, the carrier cannot enforce the provisions of the tariff.

�Deregulation� carriers were previously required to publish their tariffs with the Interstate Commerce Commission (ICC). This meant that the shipper-carrier relationship was significantly defined by published carrier tariffs, which had the force of law under the old �filed rate doctrine.�

Today, formal filing of tariffs with a federal regulatory agency is no longer required (except for carriers involved in non-contiguous trade); the shipper-carrier relationship is strictly contractual, which means the bill of lading is more important than ever.

Payment of freight charges � bill of lading Section 7

Bill of lading forms must indicate who is responsible for transportation charges. The charges may be either �prepaid� or �collect.�

The box on the face of the bill of lading referring to �Section 7 of conditions,� sometimes known as the �no recourse clause,� deals with the payment of freight charges. It is explained in Section 7 of the terms and conditions on the back of the bill of lading. It basically provides that the shipper/consignor is primarily responsible for payment of the freight and other lawful charges, unless the shipper stipulates in writing (in the space provided on the face of the bill of lading) that the carrier must not make delivery without requiring payment of the charges, and the carrier makes delivery without requiring the payment.

Shippers who leave the Section 7 area blank or unsigned are effectively telling the carrier that if they do not, or are unable to, collect the charges from the consignee, the carrier may default to the shipper/consignor for payment of the freight charges, even though the terms for payment of freight charges on the bill of lading are collect on delivery.

Execution of Section 7 has a direct impact on the carriers� ability to collect freight charges from the consignor when the charges are due from and uncollectible from the consignee.

Section 7 contains other provisions relating to the payment of freight charges; carriers may require prepayment or guarantee of freight charges. Generally, it is the option of the shipper to determine who will pay the charges and at what point.

If the carrier finds that the articles shipped are not those described in the bill of lading, the freight charges must be paid upon the articles that were actually shipped.

When the consignor or the consignee provide incorrect information that results in the shipment being reconsigned or diverted to a location other than the location identified in the original bill of lading, the consignor and/or consignee are liable for the additional charges. The respective liability of the consignor and consignee for these additional charges are pursuant to 13706.

• The Carmack Amendment establishes the obligations of both carriers and shippers during claims investigations.
• A bill of lading normally governs limiting liability; without one, it�s difficult for a carrier to limit liability in the event of loss or damage.
• Claimants must present the original bill of lading within nine months of delivery.

The Carmack Amendment

The beginning point for any discussion regarding claims in the United States is the Carmack Amendment to the Interstate Commerce Act, stated at 14706. Originally passed by Congress in 1906, the Carmack Amendment defines the conditions under which the common carrier is obligated to deliver the property and when the carrier might be excused from this duty.

Failure to issue a bill of lading does not affect the liability of a carrier under the Carmack Amendment. In other words, even if there is no bill of lading, the carrier is still liable for freight loss and damage.

This amendment states that a carrier is liable for loss or damage to a shipment upon proof by a claimant of:

1. Delivery to the carrier in good condition,
2. Arrival at destination in damaged condition, and
3. The amount of damages.

The carrier�s defense to this is very difficult. The carrier would first have to prove freedom from negligence, and then that the loss or damage was caused by one or more of the following specific exceptions:

• An act of God
• An inherent nature or vice of the goods
• An act of the shipper
• An act of the public enemy
• The authority of law

The claimant will win any litigation of this nature unless the carrier is able to prove freedom from negligence and any one of these exceptions to liability. The claimant is not required to prove that the carrier is negligent. As long as the claimant is able to prove that the shipment was tendered to the carrier in good condition, the shipment arrived in damaged condition, and the number of damages, the burden shifts to the carrier to prove itself free from negligence and one of the above-mentioned exceptions.

The Carmack Amendment allows a carrier to limit liability if that limit would be reasonable under circumstances surrounding the transportation. This limited liability is called a �released rate.�

A released rate value of the goods is an artificial, declared value unrelated to the actual value of the goods. For a released rate to be legal, there must be a written agreement, which is usually a notation executed by the shipper on the bill of lading. It must also provide the shipper with some benefit in exchange for the released rate valuation, usually a lower transportation rate. A released rate agreement has no effect on a carrier�s liability. However, it does limit the dollar amount of the carrier�s liability by fixing a maximum claim value.

Liability under a bill of lading

Lack of a bill of lading of a properly executed and signed bill of lading restricts a carrier�s ability to limit liability for loss and damage to less than the full actual value called for by law.

For a shipper, the bill of lading is the place to specify and enforce special shipping or handling instructions. In the case of non-delivery, proving the goods were turned over to the carrier can be problematic without bill of lading documentation. The original bill of lading is usually required by the carrier before processing either a loss or damage claim.

Responsibility for issuing a bill of lading belongs to the carrier under the law. (14706 (a)(1)) While it is the statutory responsibility of the carrier, it is often the shipper that issues the bill of lading in reality. Regardless of who issues the bill of lading, both parties should be aware of what the contract provisions are before signing.

The extent of liability for freight damage or loss is governed by the bill of lading when a contract that specifically addresses cargo liability does not exist between a carrier and the shipper. Under a bill of lading, the law holds that a carrier is liable for the actual loss or damage to the property.

However, there are provisions that allow a carrier to limit cargo liability. The bill of lading states the following: �Note: Liability limitations for loss or damage in this shipment may be applicable. See 49 USC 14706(c)(1)(A) and (B).� The limitation of carrier liability, often called a �released rate� is explained in Section 1 of the terms and conditions on the back of the bill of lading. Rather than being liable for the full, or actual, value of the goods, the carrier may limit their liability, usually in exchange for a lower freight rate for the shipper.

A released rate is usually documented on the bill of lading as follows:

Where the rate is dependent on value, shippers are required to state specifically in writing the agreed or declared value of the property. The agreed or declared value of the property is hereby specifically stated by the shipper to be not exceeding $____ per_____. A released rate agreement or declaration has no effect on carrier liability, but it does limit the dollar amount of the carrier�s liability by fixing a maximum claim value.

A released rate value of the goods is an artificial, declared value unrelated to the actual value of the goods. For a released rate to be legal there must be some form of written agreement, usually the notation executed by the shipper on the bill of lading. It must also provide the shipper with some benefit in exchange for the released rate valuation, usually a lower transportation rate. Carriers should note that the released rate claim protection will not be valid if the loss, damage, or delay is caused by the carrier�s gross negligence or criminal act.

Filing a claim

By law (14706), carriers are liable to the person entitled to recover under the bill of lading. The person entitled to recover is the owner or beneficial owner of the goods. The claimant will have to provide evidence of their right to file the claim. The original copy of the bill of lading or the original paid freight bill generally establishes that right.

The law limits the right to file a claim to within nine months after delivery of the freight. In the case of lost freight, the claim must be filed within nine months after the date the freight would have reasonably been delivered.

Section 2 of the bill of lading terms and conditions outlines the legal time limits for filing claims. Carriers may choose to set a longer time period in their tariff; however, a time period of less than nine months may not be included in the tariff or enforced.

The claim must be filed in writing. The carrier must handle the claim according to the procedures and notification time frames outlined in Part 370.

The law also provides a time limit of two years to bring a civil action against the carrier. This period is computed from the date the carrier gives a person written notice that the carrier has disallowed any part of the claim specified in the notice.

• In the event of damage to goods in transit, either the carrier or the shipper can be held liable depending on the scenario.

A significant responsibility in reducing claims is correctly signing the bill of lading when a driver is picking up a pre-loaded or �spotted� trailer. Drivers often have to sign a bill of lading contract when they have been unable to witness the freight being loaded. In this situation, the driver assumes the trailer contains the freight exactly as shown on the bill of lading, including the amount and condition of the freight. The driver also assumes that the freight is properly and securely loaded for transportation.

If, at this point, the driver signs the bill of lading and leaves with the load, the carrier becomes liable for any damaged or missing freight upon delivery. This is a risk for the carrier since the driver has no way of knowing what was loaded on the trailer or the condition of the freight. If the shipper loaded damaged goods or fewer pieces than the bill of lading shows, it will be up to the carrier to prove the damage or loss happened during the loading of the shipment and, therefore, is the fault of the shipper.

In some situations, the driver is able to look inside a shipper-loaded trailer and see that the goods are not loaded properly and could be damaged while in transit. Because the defective loading was clearly visible to the driver, using the shipper�s load and count (SL&C) notation will not make a difference because the driver could have prevented the damage by having the shipment re-loaded or simply refusing to sign for the load.

On the other hand, if the driver was unable to see inside the trailer due to the trailer doors being locked or sealed, the SL&C notation should be noted on the bill of lading. When improper loading is not visible, the carrier cannot be held liable for resulting damage.

While the carrier is still liable for the goods in transit, once SL&C has been noted on a bill of lading, it becomes the shipper�s task to prove the carrier is liable for damaged or missing freight.

Correctly signing for a shipper loaded trailer can mean real dollar savings, while improperly signing the bill of lading can mean real dollar losses for the carrier.

However, if the driver would have noted �shipper�s load and count� or SL&C on the bill of lading, and loss or damage is found at the time of delivery, the shipper would have to prove it occurred during transit and not during the loading of the shipment.

Compliance Issue

49 United States Code (USC) Liability for Improper Loading. A common carrier issuing a bill of lading is not liable for damages caused by improper loading if:

1. The shipper loads the goods; and
2. The bill contains the words �shipper�s weight, load, and count,� or similar words indicating the shipper loaded the goods. (80113(c))

• Companies should make every effort to reduce the amount of cargo claims filed.

Cargo claims can have a devastating effect on a motor carrier. While it is agreed that cargo claims are a part of the business and will always remain a �cost of doing business,� it is the manner in which companies manage this cost and preserve, if not improve, the company�s image as �a carrier that takes care of its customers� freight.� Any claim has a negative effect on customer service and could ultimately mean a permanent loss of business and reputation if not addressed properly.

Generally, the reasons that claims exist today is due to negligence and a lack of awareness on the part of all employees, not just the driver. The Fleet Manager can help to potentially reduce claims by recognizing this and taking the necessary steps to correct this potential loss of revenue and diminishing profits.

There is much a carrier can do to reduce the number of claims and possibly prevent claims from ever occurring in the first place. To help reduce the payout of hard-earned revenue in the form of claims, a carrier should:

• Sweep out the trailer and remove all nails in the floor and sidewalls before the driver arrives at the customer�s dock.
• Inspect the trailer for any holes in the floor, sidewall, or roof of the trailer that would allow rain or water to damage the freight.
• Inspect the bill of lading from the customer to identify the shipment and destination, and make sure freight is properly described, piece count is accurate, and weight of the shipment is acceptable for loading.
• Plan how to load using blocking and bracing tools, dunnage, straps, etc., to secure the freight while in transit.
• Use plywood and load bars to support freight by creating inner walls. Shrink wrap loose cartons on pallets. Watch to ensure directional markings on cartons are observed.
• Take extra precautions when loading hazardous materials to ensure compatibility with other freight and to properly block and brace for transit.
• Notify the dispatcher immediately if any damage is noticed at the time of loading or if anything appears to be other than expected. Another wise precaution to take is to photograph the loading procedure if possible. These pictures, once downloaded to an electronic file, could be a valuable tool in the event a claim suddenly arises from a shipment of eight and a half months ago.