Cargo Damage - Steps to Be Taken on Receipt of Cargo

Obvious Damage

When Cargo arrives at the final destination you and/or your representatives should:

a) Count, weigh, tally and examine it before accepting delivery. If it is a container shipment, record the seal number. If the seal has been broken or is missing on arrival record this on the delivery receipt.

b) Give an explicit delivery receipt, for example not "3 cases damaged" but "2 cases top broken, 1 case wet". Under no circumstances should you sign a clean delivery receipt for damaged goods. If there is a non-delivery (a shortage in the number of packages), only sign for the number of packages received.

c) Keep a copy of the Delivery Receipt.

d) Contact all carrier(s), advising them of the loss and invite their inspection. Follow up with a letter.

e) Letter(s) of Intent are required to be filed within a prescribed time period and this is governed by the conditions on the back or reverse side of the Ocean bill of Lading or other contact of carriage.

(i) Ocean Shipments: Immediately write the ocean carrier, holding them responsible and at the same time confirming prior notification.

(ii) Air Shipments: Notice must be given within 14 days following receipt of damaged goods.

(iii) Inland Shipments: The period for giving notice, is dependent upon the various types of inland transits which can occur, therefore, reference should be made to the bill of Lading or Contract of Carriage.

(iv) Freight Forwarders - Coloaded Containers: immediately write the freight forwarder, holding them responsible and at the same time confirming prior notification. This will only apply in the event the shipment is co-loaded with another freight forwarder and they are the party shown on the Master Bill of Lading as ultimate consignee.

(v) Public Authorities/Port Authorities/Stevedores: Public Authorities, Port Authorities, Stevedores may be subject to relatively short limitation period.

f) Call your insurance company or underwriter

Concealed Damage

When the damage is concealed, promptness in notifying both the carrier and your Underwriter takes on even greater importance. Written notice of such damage must be given to the carrier immediately, however no later than three days after delivery in order to have any chance at all of making recovery from a responsible party who has handled the shipment.

You should also bear in mind that prompt notice of concealed damage after arrival is sometimes the only evidence Underwriters have that the damage did actually occur during the insured voyage/transit.

Source: Aon Reed Stenhouse Inc