Why having your vendors ship to you collect is a best practice

Why having your vendors ship to you collect is a best practice.

Many vendors ship prepaid or prepay and add and most markup freight charges. That in and of itself is a good reason to have your vendors ship to you collect on your account. There are more reasons one of the most important is visibility of your incoming shipments in transit. By having visibility, you can spot possible supply chain disruptions before they have a downstream bad affect.

Visibility is key

Using the capability of a transportation management system to track incoming shipments you can instantly see when and even if your materials shipped. By importing your purchase orders with a required in-house date, a TMS can be configured to issue a warning if a required shipment has not entered the system in time to meet your requirements and avoid a line shut down or disappointing customer with a back order.

Do you charge back your vendors for the additional freight charges on your order when they back order you? With a TMS you can track the additional freight charges when a vendor does not ship a full order. Back orders could be costing you more, in freight charges, than you think but who has time to track those costs using manual methods?

Trapped shipments

Are you a large distributor or manufacturer? Freight carriers often trap or hold shipments in a trailer to reduce deliveries. That could have significant savings for them and unstable delivery times for you. By using a TMS that tracks statuses like “arrived at terminal” and comparing to “out for delivery” date/time, you can work with your transportation providers to avoid having your freight held at the carrier’s yard and not delivering the same day it arrived.

ShippersEdge is a mid-tier transportation management system that can make you money, save you money and avoid delays on your incoming shipments. You can learn more at www.shippersedge.com/info or by writing to timothy.taylor@shippersedge.com 952-777-4421.

 

 

 

Mitigating the cost of motor carrier reweighs

Mitigating the cost of motor carrier reweighs

Similar to airlines, LTL carriers are constantly trying to improve their yields. One of the tools at their disposal is to reweigh shipments. Scales built right into the forklift itself has made the process of reweighing your shipment easy and lucrative. Some carriers will also charge you a fee if their scaled weight differs from what’s on the bill of lading.

Carriers don’t lower weights

The simple little truth is carriers don’t lower weights if the weight variance results in a scaled weight below what is on the bill of lading. So, it is a one-way street when it comes to shipment weight changes, always up; never down.

Intensity of the weight changes

Here’s where you can fight back. If you keep a record of weight changes due to scaling at the carrier’s dock, you can chart the number of weight revisions on your shipments. What to keep track of? Not only the number of reweighed shipments but the intensity of the weight changes. If carrier A) changed 10% of the shipments you tendered to them and changed the weight an average of 10%, that’s one number. What if carrier B) changed the weight only 8% of the time but the weight changes went up 15%.

Keeping track of weight changes

A transportation management system can keep track of weight changes and give you the analytical tools to see what carriers are creating the most increases in cost. If you don’t have one, you’d have to do that manually and what a laborious chore.

Fight back

Another way to fight back is to monitor weight changes while the shipment is in route and have the destination terminal weigh the shipment again if you believe there is an error. A transportation management system that is constantly interrogating the carrier’s server regularly and notifying you when a reweigh is entered into their system. Did you know that to remain accurate, forklift scales should be calibrated every twelve months?

ShippersEdge is an easy to use, value packed TMS that can pay big dividends through monitoring carrier reweighs and providing you the tools to make intelligent decisions. Contact ShippersEdge at 952-777-4421 or visit us on the web at www.shippersedge.com/info

The Keys to an Unstoppable Drive

The Keys to an Unstoppable Drive

“Sometime back in the mid 80’s I was invited to attend a sales seminar hosted by Don Beveridge and I was fortunate in that I got the chance to sit in on the seminar and I found it to be a memorable experience. He was motivated and his sales motivational points were strong. The ideas he shared with the audience, with a little bit of license on my part, went something like this: You wake-up at 5am, from 5-7am, you plan your day, every hour. Be in the office by 7am and by 9am get out and prospect and be in the community. At 5pm get back to the office to do your follow-up with all your prospective clients. From 7pm – 9pm you do your administrative work. After that, get into bed so you’re ready for 5am again. I heard at least two old saws proclaim, “this guy is nuts”. I thought so too but in a good way.
There were about 200 sales people in attendance, many of which were inspired by his ideas. And my guess is that many of the salesmen (there weren’t many women selling in those days) took action after that day because they wanted his results. So they probably started getting up at 5am and arrived at the office at 7am and they started making the cold calls they normally weren’t making. But pretty soon, within a few days or weeks, most would probably stop and resume their old ways. Their activity levels go back to normal. Why? Because their productivity rose above their self-image and their self-image squashed their productivity down within their comfort level; a level consistent with their self-image. They took an afternoon off here and there, maybe they watched Oprah, maybe Jerry Springer; hung out in a bar commiserating with other freight solicitors, it was hard to say. It could be their actions were becoming inconsistent with their self-image.

Today many will talk about balance in life, those are thoughts best left to the idealists and those who believe the system is rigged and we ought to spread the wealth. I believe there is a place for balance all right, mine is in balancing the checkbook and my family life. Making a difference in your life and the lives of those who depend on you is, on its own, balance. The checkbook and family unit satisfaction are only the scorecards. If your checkbook and family life is where you think it should be, you’re doing fine and don’t need to go further unless you think you can in which case you haven’t set you goals high enough.
You will always perform at a level equal to your self-image. Our self-image is the portrait we have of ourselves. It’s the picture we’ve created about our self and is commonly based on past experiences and environmental influences. So if a new desire for improvement is introduced and it conflicts with our current self-image, it is doomed to fail. I guess I was fortunate in that I had a very successful family and couldn’t envision anything other than success.
Our actions, behaviors and yes our discipline, are all heavily influenced by our self-image. Even if you force yourself via will power to do things beyond your self-image, you won’t be able to sustain it for very long. You will go back to the old behaviors consistent with your own self-belief because you believe it and you act from this belief. What caused the Ali’s, Jordan’s, and the Annika Sorenstam’s of the world to work as hard as they did? What causes the top 1% in selling to consistently sustain their mind-boggling activity levels? Answer for all: their self-image. If you watched Tiger’s meltdown in the last couple of years and its subsequent effect on his golf course performance, you can see what a blow to self-esteem can do, even if it was of his own making.

Major changes occur in income, production and satisfaction for the average salesperson (in fact all people) when they understand the importance of evaluating, changing and elevating their self-image. Managers and salespeople comfortable with small and average client sizes but nervous and fearful with the high-end clients, who learn to grow their self-portrait become more confident and succeed in the large client arena. Lets not get into a discussion of which type of client you can make the most money on because you can make plenty off big clients if you set it up right and if you set it up right, it won’t be you doing the clerical work.

Speaking of clerical work; executives who are most comfortable working clerical tasks instead of leading a group of managers and clerical workers are destined to confine themselves to a mid-level manager’s wage. Not that there is anything wrong with mid-level management or clerical work and if that is what you want to be good at, then be the best. There are many hourly pay rates in business; the highest belong to those who can lead other people in a desperate charge to the top. Job satisfaction is relevant to the position desired and the execution of satisfying your self-image. Life satisfaction is relevant to that self-image and the life that image confines us to.
As we raise our self-image we raise our expectations, behaviors and the discipline we bring to our activities. Learning to change behavior permanently is one of the most important skills a person can develop in their life. Without this skill, any self-improvement intention will result in failure and frustration. All we need to do is to change the portrait by investing time and energy with guidance through learning.
Our self-image is held in our subconscious mind. This is the inside part of our brain where all of our habits and beliefs are stored. Many estimates in the field of psychology suggest we are only utilizing a small part of our brain – generally 5% to 10%. Which means that nearly 90% is untapped and waiting to serve us. Our subconscious mind is this under-utilized resource. It’s the part of the brain that allows our body to do things naturally and consistently with such ease and proficiency that our conscious mind could never match.
Great things that seem impossible become possible when we learn to communicate to and from our subconscious mind. Here’s how: when a thought and feelings match, and are focused on over and over again, it becomes accepted by the subconscious mind. When we add pictures or visualization, which match this thought/feeling combination, we are actually changing our self-image with a new self-belief. Our self-image is only communicated to in pictures, hence the term self-image. When this ‘pictured thought with feeling’ intention is accepted by the subconscious mind it becomes a belief that executes itself automatically.

Follow these steps to a new level of discipline by changing your self-image:

Step one: Decide exactly what you want. This is critical. Is it a habit change you’re after or how about a new goal? Whatever it is, be crystal clear on the outcome you desire.
Step two: Determine the activities that would lead to this outcome. This is an easy step; just determine what you would need to be doing in order for this result to come naturally. It’s simple cause and effect. For this step, make sure you choose activities that you could see yourself doing. There are often many ways to an outcome. Avoid the activities that don’t fit your personality, but make sure the one’s you do choose will ensure your goal.
Step three: Invest 20 minutes a day in focused quiet time, Ten minutes in the a.m. and 10 minutes in the p.m. Here is the place you need to invest the time and energy. In this time, find a quiet place in which you will not be interrupted and close your eyes. With eyes closed, put your attention on the goal. With thoughts on the goal, see yourself doing these activities with ease day in and day out.

Picture yourself becoming proficient at these activities. Bring in more and more clarity to the picture every time you do this. Visualize the time of day and the reaction from those around you. The more detailed the better! And finally feel the feelings you would feel, as you would engage in these activities; also feel the feelings, with intensity, that you would feel accomplishing this goal. See yourself actually doing the deal!
Driven people produce record results because of their belief in themselves. They grew their self-image by this ‘pictured thought with feeling’ process. Many probably didn’t even realize they were doing it. Whether they intended to or not doesn’t really matter because this is how it works and it can work for anyone.

Apply this process and remember the importance of vivid pictures and concentrated feeling. Do this and you’ll never again have to be stuck in undesirable patterns from your past. With new information can come new results.

We’re only here for a visit. If you want to make a difference, you already have. There is nothing a tantalizingly close as a dream.

Shippers use software to replace 3PLs

Shippers use software to replace 3PLs and saving big

Shippers increasingly use software to replace 3PLs with logistics software and saving the markup. One client with locations in Canada and the United States saved 13% by insourcing their logistics management and using our TMS to route their freight and provide reporting. This customer’s freight spend was in the high 8 figures. Another smaller company that makes specialized packaging materials with a more modest freight spend (less than $1MM) is installing our shipping software and is also saving substantial dollars.

The reason 3PLs flourished over the last decade is they had access to sophisticated logistics management software that previously was only affordable to the largest shippers. Now with a revolution in software underway, 3PLs and large manufactures no longer have a monopoly on transportation management system technology. All trends point to transportation management software entering the small to midsize business market. See this article: https://www.shippersedgetms.com/tms-adoption-among-small-to-mid-sized-companies/

Most people like their 3PL but the bottom line is that if the can save thousands with a modest technology spend, that can be the difference between a thin bottom line and bonuses for their employees. One CEO upon coming back from an industry conference instructed his operations department to begin sourcing a TMS for implementation in the next fiscal year. When they reported back the ease of integration and the overwhelming savings available he told the staff to begin implementation right away.

One of the factors to consider in selection of a TMS is whether integration with other internal software is important or not. ShippersEdge offers both standalone and integrated systems. Often customers come onboard without integration and add it in phase II. “We don’t care either way,” Tom Taylor, President of ShippersEdge, “we simply want them on with us and work with a client any way they choose” Taylor continued.

ShippersEdge has a long history in web-based, now cloud-based TMS applications having released the very first web-based TMS in 2002. Our staff has extensive direct hands on transportation experience, we’re here to assist clients in getting the very best out of their Shipping Software or proceeding to a full on integrated transportation management system. Oh, and we do help you get rates too.

Contact ShippersEdge at www.shippersedge.com/info or call 952-777-4421

Selecting a TMS should not be hard

Why selecting a TMS should not be hard

Selecting a TMS should not be hard like it was in the old days. The prices have come way down and the capabilities have increased thanks to modern programming practices and cloud based applications. Integration, once very expensive has come down. What makes selecting a TMS hard is the number of systems on the market and the fear of making a mistake.

Making a mistake is a relative problem as in relative to what? The return on investment in today’s TMS environment is so quick because you don’t buy them, you rent them. In the case where you want customization or integration, you can do it in stages once you’re comfortable in your selection. The setup investment is relatively minor and will likely pay back in a week or two.

Time spent by the end user in evaluating and then communicating the minimal information needed to get your TMS up and operational in almost every case will be returned on a daily basis in the form of time saving. Yes, you may spend a few hours but you get them back every day see this article, how a TMS saves time.  

Many people choose not to integrate right away but some want integration immediately usually for some management data point they want in other company software. I encourage beginning with no integration and pursuing a new piece of integration maybe every six months to add capability and save time collaborating with other departments.

Procrastination is a thief in time and every day delayed is lost value for the want of applying management talent where clerical talent is only needed. The world is moving towards automation every single day. Automation is a tidal wave in a sea of change. The problem is, if we don’t automate, we lose to those that do.

Shippers should be trying to lock in rates

Shippers should be trying to lock in rates this summer before the impact of ELDs tightens capacity.

According to a recent article in Transport Topics, US truckload carriers have too much capacity and as a result are facing a weak pricing environment. Many large fleets have idle capacity waiting for an improvement in the economy. It may be a while. Considering roughly 25% of all trucking is for retail consumers, Amazon itself is biting into trucking profits.

Surprisingly, driver turnover is down to 71% which is the lowest level in 6 years. Is 71% turnover a good number, in trucking it is. Imagine if 71% of your company workers up and left every year. This turnover rate, while high is comparing to over 100% turnover just a few years ago. You can expect turnover to rise due to Electronic Logging Devices [ELD] scheduled to be mandated by the end of the year.

Likewise, ELDs will have the net effect of decreasing capacity due to driver’s inability to skirt hours of service regulations once those ELDs are installed throughout the fleets. If that prediction comes through, truckers should be in the driver’s seat when it comes to pricing. In another angle to ELDs, shippers and receivers who delay drivers at their facilities could see their rates rise or have detention penalties. Intermediate length hauls may see a marked increase in rates due to the inefficient way the driver’s time is used.

Third Party providers such as brokers use the spot market to move shipments. The spot market has been paying better than the contract market for many truckers. That trend should continue but will also be adversely affected as ELDs are installed. Freight brokers traditionally use smaller carriers to move their shipments, arguably small carriers are the backbone of modern brokering. Once ELDs are in the trucks of smaller carriers, that pinch in miles run will take its toll on brokers.

 

 

 

What is a Bill of Lading

What is a Bill of Lading

The bill of lading is the “deal” between the shipper (and, by reference, the receiver) and the transportation company.

Many people think that a bill of lading is only a document that describes a shipment and tells the trucker where to deliver the load. However, a bill of lading actually has many functions and sets up important stipulations regarding:

  • title (ownership) of the goods
  • where title passes from seller to buyer (yes, it’s important)
  • liability for loss
  • the amount of responsibility the carrier will assume
  • damage
  • payment of the freight bill
  • and other contractual obligations.

Abiding by the carrier’s rates, classifications, and rules

The first recital on the bill of lading states,

“Received subject to individually determined rates or contracts that have been agreed upon in writing between the carrier and the shipper, if applicable, otherwise to the rates, classifications and rules that have been established by the carrier and are available to the shipper, on request.”

The above statement is found at the beginning of virtually every bill of lading contract issued in this country or is incorporated by reference in carriers’ rules tariffs. It is imperative that you understand it’s meaning; in essence, it states that you agree to abide by the carrier’s rates, classifications, and rules.

The wording of that opening statement was amended as part of the new bill of lading, adopted by the carriers as a result of the ICC Termination Act.

The ICC Termination Act of 1995 is a United States federal law that changed the requirement of carriers to file rates with the Interstate Commerce Commission (ICC). It actually abolished the agency entirely and in turn created its successor agency, the Surface Transportation Board.

It’s important to note that even if your current bill of lading doesn’t include the new language, you are still agreeing to the terms of the new bill of lading.

Tariffs or rules established by the carrier

Under the new bill of lading provisions, a carrier can establish rules without any government agency validating the particulars of those rules. For example, a carrier could say in his tariff that on Fridays that coincide with the close of a calendar quarter, rates and charges shall be increased by ten percent. Without a contract to the contrary, you would be required to abide by that tariff provision.

Another more likely rate issue would be disallowing discounts to remote locations. The disallowance of discounts is common for a variety of reasons, such as remote areas, late payments, and inside deliveries.

Released value

Many shippers have reported that carriers have published released value tariff items in their in-house rules tariffs. Most of those items release shipments to $1.00 per pound or $100,000 per shipment, etc. Historically, court cases have always held that the shipper must specifically release a shipment’s value in writing for a released value to apply. Check with your carrier’s rules tariffs to verify that they cover you to full value at the rate you paid.

It’s important to understand these segments as they make up the whole document, strengthening the agreement between shipper and transportation company.

Commodities Requiring Special or Additional Care

“Note 3” of the new bill of lading speaks to issues of commodities requiring special or additional care. Basically, note 3 is a disclaimer which could negate any damage claim you may have with the carrier, assuming the carrier was not made aware in writing of any “special” care required.

In the absence of written instructions, problems arise when the courts decide what constitutes “special.” What is “normal” to you could be “special” to someone else. That’s why listing care requirements of your shipments on the bill of lading is generally a good business practice.

Additionally, you also need to list any temperature requirements on the bill of lading in uppercase letters, according to most carriers’ rules tariff requirements.

Terms and Conditions: Carrier Liability

“Every service to be performed hereunder shall be subject to all the conditions not prohibited by law, whether printed or written, herein contained, including the conditions on the back hereof, which are hereby agreed to by the shipper and accepted for himself and his assigns.”

This is where the receiver is brought into the contract.

The above statement is part of the “long form” bill of lading in the recitals (and incorporated by reference in the “short form” bill of lading). Many people don’t know the significance of this provision, but the back of the long form contains numerous terms and conditions you should be familiar with.

Exceptions, generally.

The first of the terms and conditions refers to the carrier accepting full liability for the shipment with certain exceptions. The exceptions, approved by Congress in the Carmack Amendment of 1906 as an amendment to the Interstate Commerce Act of 1887, include the following:

  • Acts of God; i.e. tornado blowing the truck off the road, causing damage to the product
  • Public enemy; i.e. a truck and its contents being destroyed by a terrorist act
  • Authority of law; an inspector at a scale damaging freight during his inspection.
  • Acts or default of the shipper; this is the most common reason a carrier deny a claim. Packaging is the single most applied act or default of the shipper.
  • Inherent vice of the product; most easily described by a statement that is on every box of cereal “some settling may occur during shipping and handling.”

Until August of 2016, to invoke an exception recited above a carrier had to prove freedom from negligence. The National Motor Freight Traffic Association {NMFTA] amended the bill of lading as published in National Motor Freight Classification Tariff [NMFC] to change the burden of proving negligence [or freedom from negligence] from the carrier to the shipper. This is contrary to the intent of congress as proscribed in the Carmack Amendment referenced above.

He is the specific language changing burden of proof:

Original: “…The burden to prove freedom from negligence is on the carrier or the party in possession.”

As amended: “…The burden to prove carrier negligence is on the shipper.”

There will probably be a test case to determine if the NMFTA can, by fiat, alter the terms of Carmack without Congress changing the law. The Surface Transportation Board allowed the change after shipper’s groups challenged the NMFTA prior to the adoption of the new language.

The language changes also added riots or strikes as defenses see below:

Original “No carrier shall be liable for any loss or damage or for any delay caused by an Act of God, the public enemy, the authority of law or the act or default of shipper.”

As amended “No carrier shall be liable for any loss or damage or for any delay caused by an Act of God, the public enemy, the authority of law, the act or default of the shipper, riots or strikes, or any related causes.”

Further language changes also subtlety altered language

Original: “…except that claims for failure to make delivery must be filed within nine months after a reasonable time for delivery has elapsed.”

As amended: “Claims for loss must be filed with the carrier not more than nine (9) months from the date of the bill of lading.”

Carmack had held and case law supported, a carrier may not set a time period of less than nine months and that the time bar did not begin to toll until a reasonable amount of time had passed for delivery. That has not changes to the date of the bill of lading and should be considered the date of pickup.

Common Claim Declinations

As stated above, the problems that arise usually involve “improper packaging.” Packaging rules are outlined in great detail in NMFC 100-X (the rules and classification tariff).

Generally speaking, packaging should be sufficient to withstand the “rigors of transportation.” Bumpy roads, fast stopping, sharp curves, in the absence of negligence on the part of the carrier, are considered normal “rigors of transportation.”

Rollovers, crashes, and panic stops, however, are not normal “rigors of transportation,” but such events are difficult to prove. In a large claim trial, the carrier’s driver would likely testify that no such event occurred. The carrier will also offer the packaging material used in your shipment into evidence in an attempt to convince the court of its inadequacy.

Though improper packaging is an often-used declination on the part of many carriers, you can take precautions to defend yourself against such a claim. The National Motor Freight Classification tariff contains over 145 pages specifically defining packages. Freight classification items frequently define the packaging that must be used to constitute “proper packaging.” Boxes, which are allowed in most classifications, are described in item 222 of the NMFC, including minimum specifications for various sizes and weights.

If it is apparent to the trucker that the packaging is inadequate, then the carrier should refuse the shipment. A carrier has a duty to have knowledge of the shipment he is transporting. Without refusal, the carriers can no longer claim “improper packaging.” However, if a defect in packaging is not apparent, the carrier will probably prevail in his declination.

Timely delivery

Section two of the terms and conditions on the back of the long form Bill of Lading (the short form incorporates these provisions directly into the bill) says that unless agreed upon in writing, the carrier is not bound to deliver a shipment at any specific time. Carriers are only required to transport the shipment in the regular course of its providing transportation services.

Delay or losses of market claims are a nemesis of every carrier. Problems do arise in shipping, and shipments are often delayed. Companies make sure to protect themselves against this. For example, if Delta Airlines delays your flight to the Super Bowl and you miss the game, are they liable? Not according to the law or their “terms and conditions.”

To prevail in any delay claim, you generally need to have a written agreement for pickup and delivery time, as well as an agreed dollar value for any delays.

Filing overcharge claims

Overcharges include duplicate payments, two or more payments for transporting the same shipment, and over-collections. A claim for overcharges accrues upon payment to the carrier of the overcharge amount. The law requires that the shipper contest the original bill or subsequent bill within 180 days of its receipt of the bill, and bring any civil action within 18 months.

Filing loss and damage claims

Section three of the terms and conditions contains a few key points one should keep in mind when filing loss and damage claims.

  • First, claims must be in writing. If you go to court and did not file a bona fide claim in writing with the actual carrier, you’re probably out of luck if the judge follows the law. That said, the law does not specify a standard form for filing a claim. Case law has precedent that at minimum a claim must be a demand for a specific monetary value and  contain information which identifies the shipment.
  • Second, claims must be filed within nine months of the date of the bill of lading.
  • Third, lawsuits in the case of declined claims must begin within two years and one day of the carrier’s first declination.

Miss any of the above-mentioned provisions and most likely you won’t get paid. Simple procedures should be set up to get a claim filed on any loss or damage immediately after delivery.

Shipment in storage

Section four of the terms and conditions deals with carrier liability should the shipment go into storage. Essentially, the carrier must arrange for a “reasonably safe” storage facility or a public warehouse. The carrier’s liability for the shipment decreases to warehousemen’s liability. Warehousemen’s liability is for “reasonable” care; it is essentially NO liability unless you can prove negligence.

The carrier must give proper notice as defined by the laws of the state where the goods are stored. The carrier must give said notice (two notices within two weeks) before it can offer any goods held in storage to public auction to recover its freight costs. The amount recovered at auction (absent gross negligence on the part of the carrier) is final, and if it is not enough to cover the freight and storage costs, you will still owe the difference.

No signed delivery receipt

The final part of section four deals with deliveries to places where the carrier cannot get a signed delivery receipt, such as a vacant job site as a for instance. Essentially, the carrier waives further responsibility.

While on the subject of delivery receipts, what happens when a delivery receipt is lost or damaged? You still would have to the pay the freight bill unless you’re claiming the shipment was lost or damaged. At that point, the best prima facie evidence of delivery is gone and other methods of fact determination will come into play.

On a final note, what happens if you sign a delivery receipt “subject to further inspection”? This is essentially the same thing as signing it off free and clear. Inspect your shipment upon delivery, otherwise the entire burden of proof in a freight loss or damage claim is on the claimant.

History and Development of the Bill of Lading

Below is an excerpt on the originations of bills of lading courtesy of the University of Miami Law School Institutional Repository: If you care to know the earliest forms of bills of lading appear to have originated in Spain in 1544 .

University of Miami Law Review 9-1-1983

History and Development of the Bill of Lading

By Daniel E. Murray

Before the advent of air travel, sellers would send goods to a distant buyer by sea. Even today, the carriage of goods by sea constitutes a significant portion of all long-distance commercial transactions. In a typical transaction, a shipper delivers goods to a carrier ship. The carrier, the ship’s captain, or a clerk then issues a bill of lading.

The bill of lading is an acknowledgment by the carrier that it has received goods for shipment; it includes an agreement to transport these goods to the consignee or his assignees at a specified destination. A bill normally contains statements concerning the nature, quality: and quantity of the goods. These statements reflect either the shipper’s representations to the carrier or the carrier’s notations from its own inspection of the goods. If the bill of lading specifically notes the defective condition of the goods or their packaging, it is “claused” or “fouled.” If no defects are noted, it is called a “clean” bill of lading.

The duty of an ocean carrier to transport goods safely is beyond cavil. But what has been disputed historically is the extent of the carrier’s liability to the consignee of the goods or to the buyer of the bill of lading based upon the carrier’s issuance of the bill.

The issue of the carrier’s liability for misrepresentations in the bill of lading arises in two factual situations: 1) when language in the bill purports to limit the carrier’s liability for misrepresentation of the nature, quality, or quantity of the goods, and 2) when the carrier has entered into an indemnity contract with the shipper by which the latter agrees to hold the carrier harmless against claims based on an inaccurate bill of lading.

This article examines the judicial and legislative treatment of these issues, discusses the rights of the consignee or holder of a bill of lading who is damaged by misrepresentations in the bill, and describes several European approaches to the issue of the respective liabilities of shippers and carriers.

Finally, the article considers the impact of several international conventions on uniform bill of lading requirements.

HISTORY AND DEVELOPMENT OF THE CLEAN BILL OF LADING

Common Law Before 1851

Bills of lading came into common use in the sixteenth century. Most of these merely recited the quantity of packages or bales shipped. A few of these early bills, however, referred to the condition, of the goods. Such references were most frequently found in bills for goods shipped from Spain or goods owned by Spaniards.

For example, in 1544 a bill of lading was issued in Cadiz, Spain, which contained a statement that the master of a ship had received “112 bags of allam whiche goyth for tonne pype markyd with the marke in the margent to be delyveryd well condyshioned in the ryver of Themys.” s

Two years later, a bill was issued in Flanders to a Spaniard residing in Bruges in which the master stated, “The wiche fardells and bailes I knowledge to have receyved of yow John de Fica Spaynyard drye and wel condicioned whiche I shall delyver God preservinge me and my shipp.”

By 1549, statements of the condition of shipped goods were becoming even more specific, as illustrated by a bill issued in Bordeaux in which the master acknowledged receipt of the “nombre and quantetie of one hundreth and fyftie tonnes of wyne full and ullagid, which wynes the sayede maister confessyth to have receyved for the sayede Naudyn Revell.”

This trend toward more sophisticated bills of lading continued. A 1554 bill limited the carrier’s liability for damages caused by dangerous seas: “[X]v tonne ij ponchions of wyne and a barrell of apples all marked with this marke for to be consigned and well condicioned from this aforesaid toune of Roan unto the citie of London exceptid the casalties and dangers of the sea.””

By 1802, merchants had established several principles governing bills of lading. The Marine Ordinances of Louis XIV made the master “answerable for all the goods laded aboard his ship, which he shall be obliged to deliver according to the bills of lading.” Clauses certifying the condition of the goods were no longer discretionary; all bills were required to “contain the quality, quantity, and mark of the goods.”

The ordinances also recognized the need to limit the liability of a master who signed a bill indicating the condition of goods shipped in containers or packages. Because the master could not know their actual condition, it became customary that “by the quality the exterior and apparent quality only is meant.”

It became the usual practice for a master to insert in the clean bill of lading a clause indicating that his statements of quality and quantity were based on the shipper’s representations. Qualifying or clausing the bill of lading protected the master if a dispute arose as to the quantity or quality of the goods.

Prior to the 1851 English case of Grant v. Norway,” American decisions favored the third-party consignee, who relied on the representations in the bill of lading, over the carrier. In fact, the courts generally considered representations in a bill of lading to be conclusive evidence against the carrier in an action brought by a consignee. In 1810, the Supreme Court of Massachusetts held that a carrier was estopped from contradicting a recital in a bill of lading that it had issued.

Similarly, the Supreme Court of New York held that when the bill of lading recited that seventy tons of coal had been received by the carrier, the carrier was estopped from proving that it had received only sixty tons from the shipper.

The legal ramifications of the bill of lading continued to evolve in the nineteenth century. During this time, English and American courts applied similar rules regarding the carrier’s liability under bills of lading.’

Common Law After 1851

The scope of a master’s authority to bind the owner of the carrier by a false recital in a bill of lading became a crucial issue at common law. As an agent of the ship owner, the master undisputedly had some authority to bind the owner by recitals in a bill. The master’s authority was not, however, unlimited. English and American courts during this period defined the master’s authority by looking to the type of recital at issue.

In the landmark case of Grant v. Norway,”‘ an English court addressed the scope of a master’s authority and established a doctrine that profoundly influenced the common law of both the United States and England. In Grant the ship’s master fraudulently signed a bill of lading stating that twelve bales of silk had been loaded on board. In fact, the master had loaded no silk. A third-party pledgee, who had relied on the false representation, brought suit against the ship-owner based on the bill. The court held that the owner of the ship was not liable for the master’s misrepresentations because “the general usage gives notice to all people that the authority of the captain to give bills of lading, is limited to such goods as have been put on board. ‘

Relying solely on established custom, the court defined the scope of the master’s agency: The master had the authority to sign bills of lading reciting the quality or condition of goods actually received, but lacked the authority to sign for goods not received on board. Therefore, the master’s signature on a bill of lading falsely reciting that certain goods had been loaded on the ship did not subject the owner of the vessel to liability.

The distinction’ between statements on a bill of lading referring to quantity and those referring to quality of goods presented English and American courts with difficulty as they attempted to define further the scope of the master’s authority to bind the carrier.”‘

For more reading visit this link http://repository.law.miami.edu/cgi/viewcontent.cgi?article=2266&context=umlr

Coercion of Commercial Motor Vehicle Drivers

From Transport Topics and edited by ShippersEdge

Prohibiting Coercion of Commercial Motor Vehicle Drivers (Coercion Rule) The Coercion Rule took effect on January 29, 2016 as part of MAP21 passed by Congress in 2013

It prohibits motor carriers, shippers, receivers or transportation intermediaries from coercing drivers to operate in violation of HOS limits, commercial driver’s license (CDL) regulations, Hazardous Materials Regulations, etc. However, coercion can occur even if a violation has not, such as threatening to fire a driver if they don’t accept a load. It also can be raised if a shipper threatens to withhold payment or terminate a business relationship.

The rule includes procedures for drivers to report incidents of coercion to FMCSA, establishes rules for how the FMCSA will respond to those reports and describes penalties for those who are found have coerced drivers. Fleets with an ELD solution in place will also have technology that can help keep them from inadvertently making requests of drivers that qualify as coercion.

Logistics Software sends freight charges to ERP

Getting Freight Charges into your ERP using Logistics Software

Freight charges change from estimated to actual based on the accuracy of the bill of lading. Even the best rating software cannot foresee weight changes and classification changes. With LTL carriers moving more and more into dimensional rating having accurate cube information is also important. Good logistics software can smooth out the bumps.

As carriers reweigh and reclassify your shipments, freight charges change. There are two things to know, first is that the carriers will update their systems and that information is available to you if you have the right shipping software. Secondly, if one freight terminal in a freight carrier’s network reweighs your shipment, you can have the opportunity to have a downstream terminal check the accuracy of that reweigh, but you can’t do that unless you have visibility.

ShippersEdge TMS constantly is checking freight carriers for changes in the estimated freight charges. Once the shipment delivers, ShippersEdge will retrieve the actual, final freight charges and send them to your ERP appended to the order. ShippersEdge also keeps track of the number of changes by your carriers so you can manage your freight carriers. Some carriers reweigh more than others and weights never go down, do they?

Assessorial charges need scrutiny too. Inside delivery, lift-gate, redelivery charges can add up especially when they are unwarranted. Most carriers maintain a database of delivery addresses that require special services. In ShippersEdge, we have an address book that has provisions to note special delivery requirements. Assessorial charges vary carrier to carrier so knowing in advance if a special delivery service is required can aid you in selecting the lowest cost carrier.

Having the tools to do the job is what a good Logistics Software and a capable Transportation Management System is all about. Talk to ShippersEdge 952-777-4421 or read more about ShippersEdge