Server: Netscape-Enterprise/2.01 Date: Wed, 31 Dec 1997 20:56:55 GMT Content-type: text/html
This is the first in a series of articles discussing notice and claim requirements for cargo loss and damage. This article will discuss notice of loss and damage and claim filing requirements for the carriage of goods by sea. Subsequent articles will discuss notice requirements for air, motor carrier, rail, multi-modal transport, NVOCCs and freight forwarders.
When referring to the maritime transport of goods, we will concentrate from the time the goods are loaded on board the ocean carrier to the time they are discharged from the vessel. This period has often been referred to as "tackle to tackle," referring to the ship's unloading equipment.
The Carriage of Goods by Sea Act (COGSA) 46 U.S.C. App. § 1300 et seq. was adopted by the United States in 1936 to govern the rights and responsibilities of carriers and shippers of goods by sea. Unlike the Warsaw Convention for international air transport, COGSA does not require a written notice of claim, only written notice of loss or damage.
WRITTEN NOTICE OF LOSS. The written notice of loss must be provided to the carrier or carrier's agent at the port of discharge. If the loss or damage can be readily seen, the written notice must be provided before or at the time of removal of the goods into the custody of the person entitled to delivery. If the loss or damage is not apparent, written notice must be given to the carrier or carrier's agent within three (3) days of delivery. Failure to provide such notice is not fatal to a claim, but it does create a presumption that the goods were delivered in good order. You must then overcome the burden by demonstrating that the damage occurred before delivery.
WHY SUCH A SHORT TIME? (1) The carrier must be given an opportunity to investigate the circumstances of the loss or damage; (2) to avoid fraudulent claims.
CONTENTS OF WRITTEN NOTICES. Although there are no statutory requirements for the contents of written notices, shippers/consignees should provide the following details to the carrier or its agent:
WRITTEN NOTICE OF CLAIM. Although not mandated by COGSA, ocean carriers will require specific information in processing the cargo claim. The notice of cargo loss or damage will not be sufficient to process your claim. If the claimant does not receive instructions from the carrier specifying the necessary documentation to process the claim, the shipper/consignee/agent should submit the following documents in support of the claim: survey, bill of lading, commercial invoices reflecting value of goods, packing lists, certificate of origin, preshipment survey, a statement of the loss or damage and documents supporting the post-claim sale or salvage value of the goods. Note: It is highly suggested that no sale/salvage occur until both the carrier and the cargo underwriter have had an opportunity to inspect.
WRITTEN NOTICE TO CARGO INSURANCE UNDERWRITER. Do not forget to notify the cargo insurance underwriter in writing. An earlier article in this series outlined each of the specific requirements for providing notice of loss under a cargo insurance policy and the various claim requirements involved. Please visit the Cargo Letter - World Wide Web Site and review our article in edition 301.
REVISIONS TO COGSA. One further point, as many of you may be aware, COGSA may soon undergo revisions. The time requirements in providing notice of loss will not likely change. However, the drafters have carefully composed to whom notice should be provided, the contracting carrier or performing carrier. You should be concerned that one important change will be to DOUBLE the per package damage limitation to US $1000. Watch for important changes to the current law.
Next time.............claims in domestic and international air transport. [Michael McDaniel, Esq. practices transportation law at the Law Offices of Countryman & McDaniel, Los Angeles, California. He is also editor of the Cargo Letter. ]