Waynes World - April 2005

COMMON FMCSA VIOLATIONS, RULES FOR
STORING REFUSED SHIPMENTS, AND...

CAN CARRIERS HOLD YOUR FREIGHT HOSTAGE?
By Wayne Schooling

Q: We are a small manufacturer. We made three shipments through a broker, who, in turn, gave the shipments to a motor carrier for delivery. After two weeks, the freight had still not been delivered. When the freight finally did arrive at the intended location, the pallets had been triple-stacked and had fallen over. There were parts scattered all over inside the trailer. The carrier told me that they would restack the load and redeliver, but they never did. I called the broker and told them to get my freight back. The carrier told the broker that they would do it for $5,000. I now have a big problem, as none of my shipments were delivered and I am now being blackmailed for their return. Is it the responsibility of the broker to get my freight back or am I screwed? Any help would be appreciated as this has been going on for a number of weeks and now the carrier has faxed me a letter saying it’s going to cost me $100 a day for storage until I pay for the freight. Joe B., Clearfield, UT

A: Unfortunately, your story is not unusual. First, you have to recognize that a motor carrier has a “lien” for freight charges on any shipments it transports and does not have to release the shipment until its charges are paid. In your case, the carrier can probably hold your cargo hostage until the charges are paid. You’ll probably have to tender payment for their charges before they release the shipment. Then, your recourse for the loss or damage to your freight is to file a written freight claim and, if necessary, bring a lawsuit to collect your damages. You may also want to question the amount of the freight and/or storage charges and see if they are charging you fair and correct rates. As to the broker, your recourse is limited. A broker is not a carrier, it is only an intermediary and, as such, is generally not liable for loss or damage to your cargo. The only exception is when the broker is clearly negligent – such as selecting an unsuitable carrier with a bad safety rating or no insurance.

Q: Regarding storage on refused shipments, I have not been able to find anything that sets time limits on when a carrier can begin charging storage on refused shipments. I would like to know if there are any rules governing storage practices and the carrier’s obligation to notify the shipper on refused shipments. Paul M., Greybull, WY

A: Assuming that you are shipping by a common carrier under a Uniform Straight Bill of Lading, the relevant provisions are found in Section 4 of the terms and condition on the reverse side of the bill of lading. This section says, “If the consignee refuses the shipment... the carrier’s liability shall then become that of a warehouseman. Carrier shall promptly attempt to provide notice... to the shipper or party, if any, designated to receive notice on this bill of lading. Storage charges, based on the carrier’s tariff, shall start no sooner than the next business day following the attempted notification.” In other words, the Uniform Straight Bill of Lading essentially defers to the carrier’s tariff for details as to storage rates and rules. If you are dealing with a contract carrier, then, once again, the carrier’s contract would specify the details. This is another reason why shippers and carriers should have written contracts.

Q: We have had some disputes with a trucker over freight bills. We found that he was overcharging based on his tariff, and cut the bills back to the proper rate. Yesterday, we gave him a shipment and now he is holding the shipment “hostage” for the total amount that he claims is due to him from us (about $3,700). The freight for this particular shipment is only $360. Can he do this? Jennifer A., Washington, DC

A: Carriers have a “carrier’s lien” on ANY SHIPMENT they are transporting, but only for the freight charges relating to the shipment in their possession, and not for previous shipments. If you tender the $360 for the freight charges on this shipment, the carrier legally must release the shipment. If he does not, he would be guilty of “conversion” which is a legal term describing the act of converting your property to his. If this happens, you now have a remedy in court.

Q: I'm curious – what is the number one violation that the FMCSA cites carriers for in the United States? Jim F., Saratoga, NY

A: First of all, there are two main types of violations: acute and critical. The number one acute violation found in 2003 (the latest figure available) was Section 382.115(a) Failing to implement an alcohol and/or drug testing program. The number one critical violation was Section 396.11(a) Failing to do driver vehicle inspection reports.

Q: What exactly is meant by leaving the scene of an accident involving a commercial motor vehicle? Gene R., Casper, WY

A: As used in part 383.51, the disqualifying offense of “leaving the scene of an accident involving a CMV” is all-inclusive and covers the entire range of situations where the driver of the CMV (commercial motor vehicle) is required by state law to stop after an accident and either give information to the other party, render aid, or attempt to locate and notify the operator or owner of the other vehicle involved in the accident.

~ Do you have any transportation-related questions you would like me to address? If so, send them care of Wayne Schooling at NorthAmerican Transportation Association, 2533 N. Carson St, Suite 346, Carson City, NV 89706-0147. Or, if you prefer, you can e-mail questions to wayne@ntassoc.com. The NTA is a premier nationwide benefits association established to provide services, benefits and information to private fleets, trucking companies and owner operators. For more details about the NTA, call toll free (800) 805-0040 or visit www.ntassoc.com. Until next month, “Drive Safe - Drive Smart!”