ADOPTED – JULY 8, 2005
AMENDED – DECEMBER 1, 2006
IN FORCE – APRIL 20, 2007
AMENDED & IN FORCE AUGUST 9, 2007
AMENDED & IN FORCE NOVEMBER 27, 2007
AMENDED & IN FORCE DECEMBER 4, 2008
Table of Contents
SECTION 1. GENERAL OBJECTIVES & RULES
1. Carrier Expectations
2. Shipper or Receiver Expectations
3. Transportation Intermediary Expectations
4. Financial Responsibility.
SUBROGATION DIAGRAM
SECTION 2. THE CONTRACT OF CARRIAGE
1. Broker Intermediary
2. Freight Contractor
1. Carrier Definition.
2. Carrier Qualifications.
3. Force Majeure
4. Registrations and Licensing.
5. Equipment Suitability
6. Operator Qualifications
7. Carrier Certification
8. Communication.
9. Carrier Warranty
10. Transit Temperatures
11. Transit Times.
1. Shipper Responsibilities
SECTION 7. THE LOADING OF THE CONVEYANCE
1. Responsibilities of the Carrier and the Operator
2. Responsibilities of Shipper
3. Multiple Pickups
1. Responsibilities of Operator During Transportation
2. Diversion & Re-consignment
SECTION 9. ARRIVAL AT DESTINATION
1. Tender of Delivery
2. Receiver’s Right of Inspection
3. Receiver’s Responsibilities
4. Receipt for Delivery
5. Payment of Charges
6. Carrier’s Obligation To Deliver
7. Selling Damaged Load to Best Advantage
8. Partial Unloads (Multiple Drop-offs)
9. Pool Loads — Payment of Freight
1. General Considerations
2. Loss and Damage Claims
3. Carrier not at Fault
4. Carrier at Fault
SECTION 12. TEMPERATURE RECORDING DEVICES
1. Shipper
2. Receiver
3. Carrier
GENERAL OBJECTIVES & RULES
Section 1
1. Carrier Expectations. Each carrier has an expectation that the consignor shall have a contracted shipment available at the time and place agreed; the consignee shall accept the shipment at the time and place agreed upon; and, that a responsible party shall timely pay for the transportation provided.
2. Shipper or Receiver Expectations. Each party contracting transportation as the principal on the goods being shipped has an expectation of timely pickup, timely delivery of all goods shipped without damage or delay or, if damaged or delayed, with recompense for all amounts of damage or delay as contracted or, if not contracted, as required by these Transportation Standards.
3. Transportation Intermediary Expectations. Each transportation intermediary has an expectation of timely provision of all transportation services by carriers booked or under contract; accurate shipment manifest descriptions, timely and accurate pickup information from shippers or shippers’ designees; and, timely payment for all transportation arranged or purchased and sold.
4. Financial Responsibility.
a. Carriers who are members of the Corporation will:
i. subrogate their rights to transportation intermediaries who are members of the Corporation in the event of a dispute with another member, where the broker intermediary has provided services on the transaction, unless otherwise agreed in writing between the transportation intermediary and the principals (see diagram on next page);
b. Transportation intermediaries who are members of the Corporation will:
i. maintain and deal only with carriers who subrogate their rights to the transportation intermediary, unless otherwise agreed in writing between the transportation intermediary and the principals;
ii. indemnify the member for the results of any litigation undertaken by a carrier who is not a member, where the intermediary and the member have resolved the subject of that litigation through a binding mediation or arbitration settlement under the Corporation’s Mediation and Arbitration Rules;
iii. agree to act as the principal and be financially responsible for damages in any dispute that arises with another member that falls within the scope of the rules of the Corporation, unless otherwise agreed in writing between the transportation intermediary and the principals; and
iv. will receive all monies due in turn to carriers as segregated funds in trust for the specific carrier so due such monies.
c. Members of the Corporation who contract transportation as the principal on the goods being shipped will maintain sufficient financial reserves to timely pay for each shipment transported by another member of the Corporation.
SUBROGATION DIAGRAM
Transportation Disputes
Fruit & Vegetable Dispute Resolution Corporation (DRC)
Default Rules – Unless Otherwise Agreed in Writing
THE CONTRACT OF CARRIAGE
(Including Instructions to the Operator)
Section 2
Our industry requires great flexibility in making arrangements for transportation. Due to the time sensitive nature of the industry, many loads are carried based only on a shipper prepared Bill of Lading. Any contract should clearly and fully state the particulars of the carriage, especially if any terms differ from these DRC Transportation Standards. For parties who do not have a contract, or other shipping document included is Appendix I, a pattern for an agreement which will serve most situations.
INTERMEDIARIES
Section 3
Intermediaries who are members of the Corporation agree to act as the principal and be financially responsible for damages in any dispute that arises with another member that falls within the scope of the rules of the Corporation. There are two types of transportation intermediaries, namely Broker intermediary Intermediaries and Freight Contractor Intermediaries.
1. Broker Intermediary
The function of a broker intermediary is to facilitate good faith negotiations between parties which lead to valid and binding contracts. It shall be the duty of the broker intermediary to fully inform the parties concerning all of the terms and conditions of the proposed contract. After all parties agree on the terms and the contract is effected, the broker intermediary shall prepare in writing and deliver promptly to all parties a properly executed confirmation or memorandum of sale setting forth truly and correctly all of the essential details of the agreement between the parties, including any express agreement as to the time when payment is due (See Appendix II, sample Confirmation form). The confirmation or memorandum of sale shall also identify the party who engaged the broker intermediary to act in the negotiations. If the confirmation or memorandum of sale does not contain such information, the broker intermediary shall be assumed to have been engaged by the carrier. Unless otherwise agreed and confirmed, the broker intermediary will be entitled to payment of broker intermediary fees from the party by whom it was engaged to act as broker intermediary. The broker intermediary shall retain a copy of such confirmations or memoranda as part of his accounts and records. The broker intermediary who does not prepare these documents, retain copies in his files, and deliver copies of these documents to all parties involved in the transaction is failing to perform his duties as a broker intermediary. If the broker intermediary’s records do not support his contentions that a binding contract was made with proper notice to the parties, the broker intermediary may be held liable for any loss or damage resulting from such negligence. The broker intermediary shall take into consideration the time of delivery of the shipment involved in the contract and all other circumstances of the transaction, in selecting the proper method for transmitting the written confirmation or memorandum of sale to the parties.
The users of carrier services must rely upon the broker intermediary to secure a dependable, capable and reliable carrier with equipment suited for the performance of the service.
The broker intermediary arranges the contract of carriage on the terms which normally apply to such an undertaking unless it is notified of special terms and conditions which are to apply. In the latter event, it must make certain the carrier and the operator are aware of the “special” requirements. Temperature settings of the mechanical unit or other methods which may be employed to give proper protection to the produce must be provided to the broker intermediary, and given to the carrier in writing.
The broker intermediary must also secure from the shipper all special requirements which the shipper or its buyer may desire; such as in transit notification to the buyer during the course of the carriage, preferred arrival time, if any, or any other special demands. The contract of carriage and/or other written instructions given to the operator must include all essential terms which clearly define the responsibilities of all parties to the carriage. The carrier must have agreed to all terms, in advance, and so indicate by signature.
The documents on the load must show whether the charges are “prepaid” or “collect.” If the latter, the papers are to indicate to whom the financially responsible party is to pay the charges. It is permissible to specify that a portion or all of the charges are to be remitted to the broker intermediary with any remaining balance to be paid to the carrier. The amount of the charges finally payable may be the “net” due after advances to the operator are deducted.
The broker intermediary must inform all parties about payment arrangements including cash advances. It is essential that the shipper advise the broker intermediary of any cash advances it has made in order that the billing for charges will take the amount of the advance into account.
Some carriers do their own billing. Under special individual arrangements between carrier and broker intermediary, the financially responsible party may be instructed to remit the charges, in full, to the broker intermediary. Such instructions do not affect the normal responsibilities of the broker intermediary or carrier on such carriages. They do make it imperative, however, that the receiver’s receipt for the load, as given to the operator, clearly states any exception to satisfactory delivery. (See Section 9, Arrival at Destination, Article 4. Receipt for Delivery”).
2. Freight Contractor
Unlike a broker intermediary who arranges transportation with the gross amount of the freight disclosed to his principals (e.g. carrier, shipper and/or receiver), other intermediaries choose to act as buyers and re-sellers of transportation. These intermediaries locate outside transportation for one price, and sell it at a higher price. A broker intermediary commission is not charged, but rather revenues to this type of operation are generated through the undisclosed mark-up on the purchased transportation. These types of operations are generally known in the produce industry as “freight contractors”.
A freight contractor is responsible to ensure, when transportation service is properly provided, the carrier is paid regardless of whether the freight contractor is able to collect from the shipper or receiver. A freight contractor is also responsible to the shipper/receiver for payment of any proper claims related to transportation even if the claim cannot be collected from the carrier.
Thus, a freight contractor is a “principal” on two separate contractual understandings, one relating to the purchase of transportation and the other relating to the sale of transportation.
CARRIER
Section 4
1. Carrier Definition. Carriers include motor carriers, rail carriers, marine carriers and air carriers. A carrier is an entity that provides the for hire transportation by a conveyance including at least the following entities:
a. An entity that owns or leases all equipment and employs operators and helpers for the provision of for hire transportation;
b. An entity that leases some (as a supplement to owned equipment) or all of the equipment or operators or helpers for the provision of for hire transportation, but only so long as the entity is:
i. directly and solely responsible to the party contracting transportation as the principal on the goods being shipped; and
ii. directly and solely responsible to any entity entitled to cargo damage or delay claim payments if different from the party contracting transportation as the principal on the goods being shipped; and
iii. directly and solely responsible to any entity entitled to claim and recover for personal and property damage.
c. To qualify for membership each carrier shall:
i. maintain insurance of the kind and in the amount required by law within the jurisdictions (e.g. country, state, province) where the carrier conducts operations; and
ii. maintain safety qualifications meeting the requirements of the jurisdictions (e.g. country, state, province) within which the carrier conducts operations; and
iii. subrogate their rights to transportation intermediaries who are members of the Corporation in the event of a dispute with another member, where the intermediary has provided services on the transaction, unless otherwise agreed in writing between the transportation intermediary and the principals;
2. Carrier Qualifications. When a carrier provides the transportation, there is a presumption the carrier will pick up and deliver the shipment at the time and in the condition contracted for by the seller and buyer of the product, except for extraordinary events called events of force majeure. In order to meet this standard, carriers must provide and meet, as the directly responsible parties:
a. at least certain minimal standards that include qualification as a carrier to conduct for hire carrier transportation where service is offered and provided in and through Canada, Mexico and the United States; and
b. the provision of safe and adequate equipment; and
c. the utilization of adequately trained and qualified operators; and
d. the maintenance of operations that meet the Corporation’s Transportation Standards; and
e. financial fitness assuring cargo claims will be paid; and,
f. a communications system that allows a reasonable access by parties moving shipments using the carrier’s transportation service.
3. Force Majeure. Force majeure shall include acts of God, the public enemy, the authority of law, riots and strikes and when those events occur the carrier will not be liable for loss, damage or delay attributable to them; otherwise, the carrier will be responsible except to the extent a shipper’s or owner’s negligence is at fault.
4. Registrations and Licensing. Each carrier must maintain all registration, licensing, and other legal compliances wherever the carrier offers and provides transportation services. Any damage, delay or loss by reason of a failure of compliance will not be an act of the authority of law.
5. Equipment Suitability. All equipment provided will meet all the safety and other requirements of the country, state and provincial jurisdictions where the carrier offers and provides the equipment. Any damage, delay or loss by reason of a failure to meet those requirements will not be an act of the authority of law. The equipment into which the shipment is loaded must have the capacity and ability to transport products in the manner ordered. If temperature control is required, the temperature control for the products shipped must be maintainable without failure for any excuse. If there is a mechanical breakdown, the carrier must arrange for alternative protection. Temperature control equipment is required only to maintain temperature and is not required to bring a shipment into temperature compliance, i.e., a shipment loaded hot at origin is the fault of the consignor as the carrier’s equipment is solely transportation equipment maintaining the shipment as nearly in the same condition during transit as is reasonable for perishable commodities moving in a reasonable or scheduled transit time. In the event the temperatures are strictly the shipper’s own, “shipper’s temperature declaration” should be properly noted on the receipt at the time the operator signs the bill of lading for the product. It is important that the statement “shipper’s temperature declaration” appear on the original bill of lading and all copies thereof.
6. Operator Qualifications. All operators utilized will be fully qualified to operate equipment in accordance with all applicable statutory requirements to provide the service on any shipment accepted by the carrier, including available hours of service. Any damage, delay or loss by reason of a failure of those qualifications will not be an act of the authority of law nor may the carrier interpose other excuses.
7. Carrier Certification. By accepting and transporting any shipment, the carrier certifies and warrants that he can and will perform the transport of the shipment in compliance with the Corporation’s Transportation Standards, unless other transportation standards have been specifically established and agreed to. In cases where such other standards are in force, the carrier warrants and accepts that he can and will perform the transport of the shipment in compliance with the contractually stipulated standards.
8. Communication. Unless otherwise stipulated, the carrier will maintain at least daily telephone communication capability with the transportation intermediary, shipper and receiver. The carrier will be able to verify the shipments location daily.
9. Carrier Warranty. When a carrier agrees to a contract to undertake a carriage the carrier warrants:
a. The equipment is in sound condition and equal to the specified requirements.
b. The carrier understands and accepts all the specifications of the contract and the instructions contained therein or otherwise given in writing.
c. The operator(s) is ready and able to fully and satisfactorily discharge all the duties with respect to the transportation and delivery of the load, including proper operation of the temperature control unit and telephone reports en route, as specified and instructed in writing. The operator has no implied authority to arrange or alter any contract term.
d. Unless the operator has express authority from the receiver, when merchandise is loaded on a buyer’s conveyance at shipping point, the operator does not have authority to “inspect and accept” with respect to the contract terms of purchase and sale.
10. Transit Temperatures. In the absence of any agreement on temperatures, conformance to contract will default to the Corporation’s Good Temperature Guidelines (See Appendix III).
11. Transit Times. In the absence of any agreement on transit times, conformance to contract will default to the Corporation’s Good Transit Time Guidelines (See Appendix IV).
SHIPPER
Section 5
1. Shipper Responsibilities. In some cases, as a service to the buyer the shipper will arrange for responsible transportation service. Responsibility for carrier failure with respect to the load will be determined on the basis of the terms of sale agreed between buyer and seller, and not on the basis of which party may have arranged for the transportation. The shipper should make certain it is advised of the receiver’s requirements with respect to the carriage as to:
a. Delivery place.
b. Anticipated arrival time (if premium rate is to be paid for guaranteed arrival, the shipper must secure receiver’s consent to the rate).
c. Receiver’s requirements for in transit reports to be furnished by the operator.
d. Instructions as to temperature settings.
These requirements should be made known to the intermediary when arrangements for the carriage are being perfected. If an intermediary is not used, the shipper should give all instructions in writing to the carrier. The seller in effect provides an implied warranty that it will use reasonable care and judgment in selecting transportation services and providing shipping instructions to the carrier. In the absence of specific instructions from the receiver concerning the “Protective Service” that the carrier is to provide, the shipper should be governed by its own experienced judgment which becomes binding upon the receiver.
If it is the shipper’s practice to provide the carrier with a “Bill of Lading” of its own, its contract terms as to destination, the lading, rate of charges and other essential items must be consistent with the provisions of the intermediary’s memorandum and instructions to the carrier. Any conflicts should be settled immediately through the intermediary, and any mutually agreed upon changes should be put in writing.
The shipper’s bill may contain specific procedural instructions to the operator which do not alter the basic terms of the contract. These will normally consist of instructions for in transit telephone reports to the receiver. If the shipper’s bill of lading stipulates a guaranteed arrival time, this is to be added only when agreed to by the intermediary and the carrier and confirmed in writing. The operator has no authority to change or alter any contract term unilaterally, once the principals have agreed to said terms.
RECEIVER
Section 6
If the shipper makes provisions for the transportation, the receiver should be certain the shipper is fully informed of all the receiver’s requirements.
When the receiver makes its own arrangements for the transportation, the receiver should make certain the shipper is advised of the identity of the carrier. Also, the arrangements for loading time should be cleared with the shipper, in advance, to avoid complications at loading point. The receiver who arranges his own transportation will give the carrier all necessary instructions. If in the shipper’s judgment these should be modified, it is the shipper’s responsibility to contact the receiver and secure approval for changes to the instructions. If the receiver does not agree with the changes the shipper needs to receive a signed release from liability from the receiver or not load the conveyance.
THE LOADING OF THE CONVEYANCE
Section 7
1. Responsibilities of the Carrier and the Operator
The carrier should arrive at the loading place at the agreed upon time so there will be no cause for delay at point(s) of origin. The conveyance should be properly pre-cooled to the temperature specified by the buyer or shipper. The inside of the conveyance should be thoroughly cleaned prior to loading. The conveyance must be in good condition and all temperature protective service equipment and features properly maintained (inner walls, insulation, air delivery chute, front return-air bulkhead, door seals and hinges, and closing devices).
The operator should observe the loading of the conveyance and object to any procedures which they deem improper. In this event, the carrier should come to agreement with the shipper or the receiver. The operator should record in writing the total amount of product loaded (e.g. number of packages, cartons, bins, lugs, etc.). In the event the method of loading and count are strictly the shipper’s own, “shipper’s load and count” should be properly noted on the receipt at the time the operator signs the bill of lading for the product. It is important that the statement “shipper’s load and count” appear on the original bill of lading and all copies thereof.
The carrier is charged with knowledge of the laws and regulations pertaining to carrier operations. Should the carrier specifically consent to an overload, it will be responsible for penalties which may be imposed by authorities who exercise weight control enforcement. Delays resulting therefrom are also chargeable to the carrier.
The operator should make certain the recording instrument for in transit temperatures is properly placed. If a temperature recording instrument has not been, or is not to be installed in the conveyance, the carrier may do so at its expense to protect its own interests. If seals are applied to the conveyance doors, they should remain intact through tender of delivery to the receiver. However, if it is essential that the carrier break the seals during transit, he must do so only upon the express permission of the party who requested that the seals be applied, except by authority of law. The seal numbers must be properly noted in the papers covering the carriage. If load locks have been attached, this fact should also be specifically noted. In the event seals are broken by authority of law, the operator will note the following information on the bill of lading:
a. identity of the authority; and
b. new seal numbers; and
c. reason the seal was broken
The operator should make certain that all documents related to the carriage are complete and in good order. The operator should be certain he fully understands the responsibilities as outlined in these documents.
2. Responsibilities of Shipper
Loading should be accomplished without unnecessary or avoidable delay. Arrival time at destination is directly related to the time of completion of loading and departure of the conveyance. The shipper should inspect the conveyance before loading to ensure that it is clean, that it is in sound enough condition to maintain desired product temperatures during transit, and that it possesses the necessary features for product temperature maintenance (such as intact air delivery chute, front bulkhead in-stalled, side door seal tight and no wall, door or door seal damage). Precautions should be taken to provide maximum protection to the load to avoid in transit shifting and bruising damage. Products should be loaded in such patterns as to ensure proper air circulation through and around the load for satisfactory product temperature maintenance during transit.
The load should not exceed the weight-load specified when arrangements for the conveyance were made. On loads to be stopped for partial unloading, each receiver’s lot should be so placed as to make possible the identification and selection of its share of the load.
The shipper should ensure that the product has been properly pre-cooled to, and loaded at, the desired transit temperature. In the event the operator cannot confirm the pulp temperatures then it should be so noted on the bill of lading. In the event the temperatures are strictly the shipper’s own, “shipper’s temperature declaration” should be properly noted on the receipt at the time the operator signs the bill of lading for the product. It is important that the statement “shipper’s temperature declaration” appear on the original bill of lading and all copies thereof.
If the carrier is to arrive at loading point pre-cooled or preheated, the shipper must give the intermediary or carrier specific notice of this essential when arranging for the conveyance. When a temperature recording instrument is used, the shipper should make certain this instrument is properly placed in the load and the number of the instrument clearly noted in the papers covering the carriage. (See Section 12 – Temperature Recording Devices)
The Corporation recommends shippers complete a Shipper’s Report (See example in Appendix V), to make inspection and temperature facts immediately available at destination and to aid to prompt settlement of any differences which may arise.
3. Multiple Pickups
Multiple pickups, some at widely separated pickup points, are frequently desired. Upon arranging for needed carrier service, it is imperative that the intermediary or carrier be fully informed of such requirements in advance. The Contract of Carriage must detail such requirements. A charge for each multiple pickup, as such, should be agreed upon at the time arrangements for carrier service is made, and such charge should be clearly stated in the Contract of Carriage.
Each shipper should be alerted to the requirement to expeditiously put his share of the load into the conveyance in order that there will be no undue delay in the final departure of the loaded conveyance. Anticipated arrival time at destination must be computed from the time of completion of the final loading. As the operator may have used up allowable transit time during the pickup operation, this fact must be given due account.
So far as practicable, each receiver’s lot should be marked for identification by each participating shipper. Consideration of the need for more than one pickup, with re-opening of the conveyance at each point, assumes importance in any claim matter related not only to the temperatures maintained from the time of the initial pickup, but also to the possibility of delay. The carrier may properly insist upon installation of an in transit temperature recording instrument at the first pickup point.
THE CARRIAGE
Section 8
1. Responsibilities of Operator During Transportation
Operators must fulfill instructions for phone reports to the receiver, as specified, in regard to both day and hour. Only the essential stops should be made for refueling and normal servicing and as required by current laws and regulations related to the operators working and where applicable hours of operation. All instructions such as those pertaining to temperature settings or icing must be fully respected throughout the entire period of the carriage.
On some loads, operators take pulp temperature readings in transit when deemed feasible and as part of their normal procedures. Such activity must be conducted without disturbing the contracted protective service. In these cases, temperature readings should be properly recorded on the operators’ documents with the date and time of such readings. Delays, carrier breakdown or temperature unit going out of service must be recorded and reported by the operator. Any delays in transit should be promptly reported to the receiver, shipper or intermediary, according to original notice terms set forth in the contract of carriage with the reason for the delay. If the delay is caused solely by route condition or adverse weather, proper notation of this fact as to time, place and any change of routing should be made.
When the carrier has stopped for partial unloading, it is the responsibility of the operator to make certain the partial delivery is properly made and the remaining portion of the load is in good order for the continuation of the carriage and continued safe transport of the load.
2. Diversion & Re-consignment
If the carrier is diverted or re-consigned to a point other than the original destination, any revision of the charges must be fully agreed upon by the parties to the contract of haul at the time the instructions for the diversion or re-consignment are given and accepted.
ARRIVAL AT DESTINATION
Section 9
1. Tender of Delivery
The contract of carriage is independent from the contract between the buyer and the seller of the merchandise on the carrier. The contract of carriage is completed when the carrier is available for unloading at destination point.
“Tender of delivery” is said to have occurred when the carrier arrives at the receiver’s location at a reasonable or instructed hour to be unloaded and, when necessary, the carrier gives the receiver notice of the arrival. When the receiver is advised of arrival and instructs the operator to hold the load at a place commonly used for carriers whose unloading may be temporarily delayed, tender has taken place. The buyer’s timely complaints to the shipper and the computation of allowable unloading time are related to when “tender of delivery” has occurred.
2. Receiver’s Right of Inspection
Upon tender of delivery, the receiver has a right of inspection of the load. This right cannot properly be denied nor abridged by the carrier. Inspection is not conditional upon the prior payment of the freight charges.
Should the receiver or carrier deem it advisable to secure an official inspection of the load, the cost of inspection is to be borne by whoever orders inspection. The inspector should be asked to note the pulp temperatures of the commodity inspected.
3. Receiver’s Responsibilities – Unloading (See also “8. Partial Unloads” & “9. Pool Loads”)
The normal transportation contract does not provide for the unloading of the truck. Lacking a specific agreement, it is the receiver’s responsibility to unload the conveyance. Unloading services are negotiable and the parties to the transportation contract can make alternative arrangements. The most common arrangement is with contractors commonly referred to as “lumpers”. A lumper is an entity that provides the physical loading and unloading of shipments at origin and destination with the use of people and equipment. The loading is from the facility of the consignor into the carrier equipment transporting the shipment from consignor’s premises and the unloading is from the carrier’s equipment into the receiving facility for a shipment at destination. Usually, a lumper is an independent contractor from the consignor or consignee or carrier.
a. Lumper Use.
The standard transportation contract with a carrier does not include the use of a lumper and does not contemplate the cost of the lumper service. In situations where these services are required, but have not been contracted in advance, the party requiring the service will be liable for payment of the service.
b. Third Party Providers.
Third party providers include parties that do not ship and do not transport the merchandise. Examples would include freight bill payment businesses, pallet providers, testing services. If a carrier is to be involved with any such service that involvement and the cost of that involvement is a matter of specific agreement as the service is not included in the transportation rate.
c. Lumper Requirement.
The use of a lumper or a third party provider may be subject to certain laws. In the United States, for example, the Federal law (Motor Carrier Act of 1980) makes it illegal to force an operator to hire unwanted unloading assistance. If the receiver requires additional labor to help unload the truck, the receiver must bear the cost of the additional service.
d. Market Charges.
The charges imposed for entry into a general market facility are chargeable to the receiver unless the carrier has previously agreed to include such charges in their quoted rate.
e. Product Temperatures.
The receiver should measure product temperatures at the time of delivery and during unloading. In addition, the receiver should inspect the load prior to and during unloading to determine the extent and tightness of load contact with the sidewalls and rear doors. Also, the conveyance should be inspected for any condition factors that might influence the capacity to maintain desired product temperatures during transit. If conditions warrant, the receiver should arrange and have conducted an inspection of product quality and condition at the time of delivery (preferably while the product is still on the conveyance and during unloading).
f. Unloading.
Unloading should proceed with dispatch. The truck is not to be used as a warehouse except by consent of the carrier and then only upon payment of warehousing charges as agreed to. Under the terms of the Corporation’s Trading Standards, the buyer’s responsibility to the seller requires that the buyer accept the produce within a reasonable time (8 hours after tender of delivery for trucks. See reasonable time definition for other conveyances – Section 17 of the aforementioned standards) or within such period give seller due notice of rejection or claim. In the relationship with the carrier there is an equal demand for timely action in unloading and payment of the carriage charges.
g. Warehousing Fees.
The carriage is to be deemed completed upon tender of the load to the receiver upon arrival. If the completion of the unloading is delayed for more than the reasonable time defined following tender of delivery due to reasons which are not the responsibility of the carrier, the carrier is deemed to be providing a warehouse service for which it is to be paid. The initial reasonable time period allows for time to secure inspection while the load remains undisturbed. Fairness demands even more prompt unloading where subsequent deliveries are to be made. In certain restricted circumstances unloading may be slightly delayed beyond the reasonable time period, but the carrier must agree to this delay. The parties should agree on appropriate warehousing charges which are to apply beyond the reasonable time period. In the absence of an agreement, the fees will default to the Corporation’s warehousing charges guidelines (See Appendix VI).
4. Receipt for Delivery
No receipt should be signed with the expectation of later repudiating its apparent meaning or effect. To note any and all exceptions before affixing one’s signature, or having it signed on one’s behalf, is the responsible and expected approach.
At the time of unloading, if the receiver’s representative is not qualified to inspect for “condition,” the designation “For Quantity Only” or similar designation should be clearly noted on the receipt.
The fact of a signature “For Quantity Only,” or the providing of a restricted receipt, does not serve as a notice of claim. Rather, a notice of claim must be independently spelled out in its own terms and made to the proper parties within a reasonable time.
The possibility exists when merchandise is received and unloaded that there may be concealed damage which cannot be determined through a reasonable inspection during the unloading process. If there is such concealed damage, the receiver is to discover it within a reasonable time, immediately notify the carrier, and intermediary if any, and obtain inspection in accordance with the Corporation’s Inspection Policies and Procedures.
What represents “reasonable time” is dependent upon the facts in each case including the commodity involved, any delay in unloading, the nature of the claimed damage, etc.; but such “reasonable time” should be based on the Corporations Trading Standards (8 hours after tender of delivery for trucks. See reasonable time definition for other conveyances – Section 17 of the aforementioned standards).
5. Payment of Charges
(See item 3 – Receiver’s Responsibilities – f. Unloading; Item 8 – Partial Unloads; Item 9. Pool Loads and Section 10 – Claims, Item 4 – Carrier at Fault)
The contracting party is responsible for prompt payment of the carriage charges in full to the carrier or the intermediary as specified in the contract of carriage unless they have reasonable cause (see Item 4 of the General Rules of Conduct under the Corporation’s Trading Standards).
The documents pertaining to the carriage should detail clearly the manner in which the charges are to be paid. On “collect” loads where a portion, or all, of the charges are to be paid to the intermediary, it is sound practice for the intermediary to independently notify the receiver through FAX or other prompt means of the dollar amounts to be paid and to whom.
If the receiver is to deliver a check to the operator, that check should be made payable to the carrier unless other specific instructions are issued. If payment is to be mailed, per instructions in the documents, the operator should be given a receipt for delivery signed by the receiver (see Item 4 above – Receipt for Delivery”).
It is unreasonable for the carrier to demand payment of charges by Certified Check or other guaranteed financial instruments unless special arrangements have been made in advance.
The carrier’s portion of any freight charges paid to the intermediary is held by the intermediary in trust and is to be paid promptly to the carrier.
6. Carrier’s Obligation To Deliver
(See Item 5, – Payment of Charges)
Carriers cannot refuse to make delivery. The merchandise on the conveyance is the property of either the shipper or the receiver unless they agree to transfer title of the goods.
7. Selling Damaged Load to Best Advantage
If “It Cannot Be Immediately Determined” who is appropriately responsible for the claim, the receiver may sell “distressed” merchandise upon giving notice to either the shipper or the carrier, or both, of its intention to “sell for account of whom it may concern.” He then proceeds to discharge his obligation to minimize the loss on distressed or problem loads as required under the Corporations’ Trading Standards.
8. Partial Unloads (Multiple Drop-offs)
In produce trade terms, shipments requiring delivery at more than one stop are “split” or “pool” loads. Such shipments are pooled to afford each party the opportunity to gain the most economical transportation rate.
The shipper usually instructs the delivery stops when ordering the conveyance. The added charge for the additional stops should be stated in the contract of carriage. Each buyer should proceed promptly to unload its share of the load and only its share. Receipt which is given the operator at each stop should include note of arrival time, the time unloading is completed and when the conveyance is released for continuation of the carriage.
Each delivery should be accomplished within the shortest practicable time and the load continued on its scheduled run without undue delay. Arbitrary demands that one buyer’s special purposes be served may be completely out of order as they produce problems and upsets in the timely and anticipated deliveries to the remaining participants. Each participant and the carrier should make certain that the remaining lots on the conveyance are so loaded and protected that they should arrive in good order for later deliveries. All possible steps should be taken to preserve the effects of the protective service.
Obviously a delay by one of the buyers can create a claim based on delay at subsequent deliveries. The carrier is not to be held liable for such claims. However, a buyer who causes delay may be liable in such circumstances.
9. Pool Loads — Payment of Freight
On pool loads billed to a produce broker or dealer the amount of carrier’s charge for each “drop” should be agreed upon prior to the carriage. These operations normally pay the carriage charges. Some produce brokers and dealers withhold payment until each participant has paid them the charges. Such payment is included in the receiver’s payment for the merchandise. Unless the carrier has agreed to such an arrangement, payment of the freight charges should be made within the payment terms agreed in the contract haul
CLAIMS
Section 10
1. General Considerations
a. Timely Filing of Claim
Time Within Which A Claim Must Be Filed Against A Carrier of Exempt Commodities. With the exception of concealed damage, it is essential that claim notice be given the carrier immediately at the time of unloading. Further, all essential notations concerning the then known nature of the claim should be placed on the receipt of delivery given the operator. In the absence of other specific contract provisions, the detailed PROOF OF CLAIM should be presented to the intermediary or the carrier within no more than thirty days.
b. Responsibility of Transportation Intermediaries.
All intermediaries (broker intermediaries and contractors) who are members of the Corporation have accepted financial responsibility for payment of freight and claims as outlined in the Corporation’s Trading Standards and Transportation Standards. Members of the Corporation may or may not be protected in situations where they deal with intermediaries who are not members of the Corporation.
i. Carriers and other members will have standing in any dispute with each other where they have dealt through a broker intermediary who is not a member, on the condition that the broker intermediary has acted as a broker intermediary in the transaction and not taken title to the freight.
ii. Carriers and other members will not have standing in any dispute with each other under the Corporation’s rules where they have dealt through a contractor who is not a member.
2. Loss and Damage Claims
Any party who would make a “Loss and Damage” claim must promptly establish the responsibility of the party from whom it would collect. It is important to provide, independent and unbiased evidence to support the claim (See Corporation’s Trading Standards and Inspection Policies and Procedures).
3. Carrier not at Fault
If it is clear that responsibility for the loss damage is not related to the contract of carriage, the carriage charges should be paid in full. The carrier should not be compelled to await payment of its freight charges pending the outcome of any dispute between the buyer and seller. The carrier has fulfilled its responsibility and deserves to be paid the full amount of its charges.
In some situations, the receiver will be authorized by the shipper to handle the merchandise for the account of the shipper so that the transaction is converted to a consignment. The basis of the relationship between shipper and receiver does not concern the carrier. In this event, all of the costs, including payment of the freight cost, are chargeable to the shipper. The freight charges should be paid by the receiver-commission merchant, and any deficit on the sale of the merchandise should be collected from the shipper.
If the receiver advises the carrier that it is rejecting the load and no substitute delivery instruction is provided, the carrier should ask the shipper for such instruction and also make new arrangements for payment of all subsequent charges. A rejection by a buyer to the shipper does not relieve the buyer of his obligation to pay the carrier charges up to initial delivery.
4. Carrier at Fault
Where it is evident that the fault is with the carrier, the most practical and fair procedure is to seek an immediate understanding concerning payment of a claim in the proven amount. When the measure of damages may not be determined precisely until the merchandise is sold, arrangements should be made between carrier and receiver concerning the time and method of selling the produce and when payment of any balance of freight charges is to be made to the carrier. Should the parties fail to reach an agreement the dispute can be submitted to the Corporation for resolution under its rules.
INSURANCE
Section 11
The cost of any special insurance coverage ordered by the shipper or receiver should be borne by the party ordering the coverage.
TEMPERATURE RECORDING DEVICES
Section 12
The Corporation requires the use of temperature recording devices where such devices are permanently installed components of refrigeration units on the conveyances used to transport the merchandise. Information recorded by such devices will be carefully preserved by the carrier, and will be promptly shared with any and all parties who have a financial interest in any dispute arising from a particular transaction. Failure to preserve, present or share this information by the carrier, or by any other responsible party will create a negative inference in the application of the Corporation’s rules.
In addition to the above stated requirement, the Corporation recommends the use of portable temperature recording devices in all shipments. Moreover, each financially responsible party to any transaction is deemed by the Corporation to have the right to require, at its expense, the installation of a portable temperature recording device. On shipments where portable temperature recording devices have been installed responsibilities will be as follows:
1. Shipper
a. Completely document the temperature chart. Show: date, shipper, authorized signature or initials of loader, contents of vehicle, consignee, car number or conveyance license/identification number, instrument number, chart number and time loaded.
b. Completely document the notice of shipment form. In addition to information listed above, identify the carrier, or intermediary, as well as the operator.
c. Note the instrument’s number on the bill of lading.
d. Forward copies of the notice of shipment form to consignee and the recorder supplier promptly.
2. Receiver
a. Remove recorder from the load as soon as possible upon arrival of the shipment.
b. Immediately remove or download temperature record and inspect for unusual temperatures.
c. If the temperature record shows improper in-transit temperature, call for an immediate inspection.
d. Advise your shipper of the situation.
e. File the temperature record in a safe place, preferably with the shipment file.
f. If no recorder is found note such occurrence on the bill of lading; if no such notation is made it will be assumed the receiver has possession of the recorder.
3. Carrier
a. If a recorder is noted on the bill of lading at shipping point, verify the position.
b. If the operator signs the bill of lading where the recorder is noted on the bill of lading he will be deemed to have received it and be responsible for its delivery.
c. Consistent with the other references in these standards to “shipper’s load and count”, the carrier may be held accountable for a missing recorder when this term is marked on the original copy of the bill of lading only if the seal has been broken.
INTERPRETATION
Section 13
In these transportation standards and in all other By-laws of the Corporation hereafter passed, unless the context requires, words importing the singular number or the masculine gender shall include the plural number or the feminine gender, as the case may be, and vice versa, and references to persons shall include firms and corporations. The headings used are inserted for reference purposes only and are not intended to be considered or taken into account in construing the terms or provisions thereof or to be deemed in any way to clarify, modify or explain the effect of any such terms or provisions.
APPENDIX
APPENDIX I: CONTRACT OF CARRIAGE
APPENDIX II: BROKER INTERMEDIARY LOAD CONFIRMATION
APPENDIX III: GOOD TEMPERATURE GUIDELINES
