Freight transportation liability is supposed to be simple and easy to understand. Traditional transportation laws hold that carriers are responsible for the freight until the consignee receives it. Currently, there is no clear delineation of responsibility because of the individual contracts that each shipper and carrier enter into. The result is that plaintiff lawyers need to go up the supply chain – carrier to broker and even shipper – for compensation.
Additionally, the Compliance, Safety, Accountability (CSA) program and the Safety Measurement System (SMS) of the Federal Carrier Safety Administrator (FMCSA) confuse shippers instead of clarifying the contentious issues involved. The result is that shippers need to closely scrutinize the language of the contract and the coverage the insurance policies of both the shipper and carrier. It is now obvious that shipping liability is no longer the sole domain of lawyers.
Trucking Industry Safety
Safety in the trucking industry is regulated by the U.S. Department of Transportation but there is also the involvement of Occupational Safety and Health Administration (OSHA). OSHA regulations hold the trucking company and the driver responsible for the trucks’ safe operations but do not cover those people who ship or receive the freight. OSHA rules assign the responsibility of the safety of workers at the dock, warehouse, construction site, and other places truckers go for pick up and delivery of freight.
Shipper Load and Count
The shipper loads the trailer, secures the freight, and applies a seal to the trailer’s door. The driver of the carrier’s representative is not present, and is not allowed, on the loading dock. This is what is called the Shipper Load and Count shipment or SLC. SLC must be noted on the bill of lading, making it very clear who has the responsibility over the freight up to the point of loading. This is significant because the carrier’s liability on an SLC shipment is limited to negligence. On a regular load that is not a SLC shipment, the carrier’s liability is extensive with very few exceptions.
Liabilities arising out of damages to the freight caused by the shift or falling of the freight during transit or during loading and unloading fall to the shipper. The liabilities of the carrier are limited to damages to the freight caused by the trailer rolling over or when the weight of the trailer and tractor exceeds legal limit.
Freight Contract
Liabilities may shift if the freight contract between the shipper and the carrier specifically points out the extent of responsibility and liability. In that case, the traditional practices are superseded by the terms of the contractual agreement.
It is important that copies of the contract, the insurance coverage of both parties, and the nature of the shipment be included in the customer carrier packet in order to avoid any misunderstanding and costly litigation at the end.
Resources: http://beckerlogistics.com/becker_fckeditor-files/file/2011%20Carrier%20Packet%20.pdf