Don't Bank on
A It appears from your question that you have, to this point, relied solely on the broker and asserted no claim of payment from the shipper or consignee. That party will argue, no doubt, that it paid the broker in good faith and that, because you did not give it fair notice that you expected payment, it should not be required to pay twice. Some courts have accepted this promissory estoppel argument as barring carrier recovery where the facts support the shippers point of view. Even so, if you have not misled the shipper, you may have a strong argument for shipper liability.
Ordinarily, the bill of lading is a written contract among the carrier, the consignor and consignee. If your name appears as the carrier of record as it should the shipper or consignor normally will be liable to you for the payment of your freight charges. Exceptions would be if the bill of lading clearly indicates otherwise or if you have, by written contract or a course of dealing, led the consignor to believe otherwise.
A broker arranges for transportation for compensation as an agent or as an independent contractor. As an agent, it is not responsible for the acts of its principal, be that principal a carrier or a shipper, unless it affirmatively assumes those responsibilities by guaranteeing them.
In entering a broker-carrier agreement, you should think, As a carrier, am I dealing with a broker as the agent for its customer? Am I looking to the broker to guarantee payment in case the brokers customer does not pay it? Or am I willing to agree to give up recourse to the consignor and consignee and look solely to the broker for payment?
In New Prime v. PLN, 28 S.W. 3d 899, the court held that the bill of lading governs the services between the carrier and the shipper. In the absence of an agreement to the contrary, the carrier has no recourse to the broker in the event the broker does not receive payment of charges from the carrier.
In National Shipping Co. of Saudi Arabia v. Omni Lines, 106 F.3d 1544 (11th Cir. 1997), the court noted that intermediaries have few assets and that carriers have a contractual right to expect payment from the shipper under the bill of lading. It found:
Carriers must expect payment will come to the shipper, although it may pass through the [intermediarys] hands. While the carrier may extend credit to the [intermediary] there is no economical and rational motive for the carrier to release the shipper. The more parties that are liable, the greater the assurance the carrier will be paid.
Courts language above offers carriers good guidance. Your carrier-broker
contract should provide that the broker is the agent of its shipper/customer.
In most cases, thats truly the relationship. The shipper gives
the broker the freight, and the broker then looks for the carrier. To
avoid confusion and the possibility of disputes, follow these steps: