Put it in writing, warns ITIC

Thursday, May 02, 2002
Failure to confirm details in writing could have serious financial consequences for intermediaries, warns the International Transport Intermediaries Club (ITIC) in its latest Claims Review. In one case, an in-house liner agent received a booking for eight metal-clad switchgear units to be transported by his principal's service to Panama. Although the agent informed the shipper by telephone that he could not guarantee underdeck stowage for the switchgear, he failed to confirm this in writing. The units were stowed on deck and suffered wet and rust damage. The consignee refused to take delivery and the shipper sued the shipping line for $900,000 plus interest and costs. The case was in court for several years and was eventually settled by the line for $600,000, of which $500,000 was contributed by the in-house ship agent. If the agent had confirmed what he said on the telephone in writing, this claim would not have been pursued. Elsewhere in the Claims Review, agents are reminded of the need to have their own standard trading conditions. For example, a UK liner agent booked the carriage of an electrical cable from Southampton to Singapore via Felixstowe. During trucking, the cable struck the underside of a bridge. The cable was inspected and, as the damage appeared to be to the packing only, it was put on the ship. Unfortunately, when fully unpacked on arrival in Singapore, the cable was found to be useless for its intended purposes and a claim for $500,000 was presented to the line. The place of receipt on the bill of lading was Felixstowe and the UK liner agent was therefore acting for cargo during the pre-carriage. Fortunately, the agent had notified the cargo interests of his own standard trading conditions by means of a footnote on the booking confirmation and was able to limit his liability. If he had not done so he would have had to pay for the value of the cargo and probably any consequential losses too. ITIC is a specialist mutual insurer of professionals in the transport industry. It is managed by ITIM Co Ltd, a Thomas Miller company.

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