Put it in writing, warns ITIC
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.