Guilty Until Proven Innocent?
By Henry E. Seaton

December 2000
Reprinted from

In most areas of the law, the claimant must show that the defendant was negligent or somehow caused injury. But in the world of cargo claims, shippers have an edge. If you fail to note damages or irregularities at time of pickup and then deliver a damaged shipment, the law presumes that you are responsible for the fair market value or destination market value of any lost or damaged goods. The shipper never has to prove that you were negligent or responsible. Although the standards imposed on you by federal statute are scary, you may benefit from one or more of five common law defenses.

You are generally liable for cargo damage unless you can prove that you were not negligent and that the loss resulted from one of five conditions:

Act of God. Extraordinary and unforeseen events such as floods, unusual lightning, earthquakes, blizzards, hurricanes or tornadoes are strong defenses against claims. But foreseeable weather conditions -- hot Julys in South Texas or early frost in Massachusetts, for example -- are not acts of God. You must show that you could not have anticipated the event or taken appropriate steps to avoid a loss.

Inherent vice of the good. You can successfully defend a damage claim if you can show that a "natural defect" in the item being transported caused the damage. This is most often used as a defense in perishable commodity claims. A commodity suffers from an inherent vice if it has some condition that will cause it to deteriorate over time. Concealed infestation, fermentation, decay, corrosion and rusting have all been used by carriers to defend claims.

Remember, however, that you have the burden of proof. It's not enough to show that the goods were flawed. You must also be prepared to show that the driver had no reason to suspect the problem at the time of pickup and that you did nothing during transportation to exacerbate the loss. If freezer damage or spoilage is an issue, for example, you may need to show that you didn't have a chance to inspect the shipment adequately at time of pickup and that you maintained the product within the required temperature tolerance during transportation.

Act of public enemy. This common law defense is seldom, if ever, used today. "Public enemies" are defined as the military forces of a nation at war with the U.S. It's arguable that since Pearl Harbor no loss would qualify. By contract and by tariff, carriers have added loss caused by strikes, riots and mobs, and several courts have upheld these exceptions. But the far bigger worry of theft does not count as an act of public enemy.

Act of public authority. You can escape liability for loss or damage if you can show that the cargo was embargoed or taken from the carrier by legal process. If, for example, state or local police confiscate the shipment or restrain you from making timely delivery, you might prevail on this defense.

Act of shipper. This defense is by far the most popular basis for denying a claim. Insufficient packaging, poor packing and improper loading and bracing all fit under this common law defense. Shippers must package items in a way that will sustain the ordinary wear and tear of transportation. There are accepted packaging standards and experts available who can help carriers prove that damage occurred because packaging was deficient.

You must make a reasonable inspection and correct apparent defects. But you have no liability for loss caused by hidden packaging defects. And whatever inspection obligations you have are diminished when the shipper is responsible for load and count.

When faced with a claim, be sure to review it carefully to determine whether you can assert on of these five claims.
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