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A claim for known damage should be supported by the following documents:
Original bill of lading (if not previously surrendered to carrier). Original destination freight bill. Original or certified copy of invoice. Itemized bill for cost of repairs or original sales account.
The acceptance by the consignee of a damaged article does not, in any way, jeopardize any proper claim which the owner may have against the carrier.
Repairing Damaged Freight: If a damaged article can be repaired, it is the duty of the consignee to have repairs made, submitting bill therefor to the carrier with other documents in support of claim. If the damage is extensive, and cost of repairs will be large, it is advisable to consult the carrier before proceeding with repairs. Should the damage be of such nature that satisfactory repairs cannot be made, but has not rendered the article valueless, the consignee should, with the knowledge and consent of the delivering carrier's agent, dispose of it to the best advantage and file claim for the net loss sustained.
Concealed Damage: A "concealed damage" is understood to mean a damage to the contents of a package which is not in evidence at the time of delivery by the carrier but which is later discovered by consignee, as in the case of a crate of furniture or cask of crockery received by consignee in apparent good order and breakage found upon unpacking.
A claim for a concealed damage should be supported by the following documents:
Original bill of lading (if not already surrendered to the carrier). Original destination freight bill. Original or certified copy of invoice showing all terms of purchase. Concealed damage form or copy of inspectors report.
A concealed damage should be reported to the agent of delivering carrier immediately upon discovery if the goods were adequately packed to withstand ordinary handling, and the material and construction of the container conformed to classification specifications.
When affidavits are submitted to carriers in support of claims of this class, they should always be made by a person who is conversant with the facts set forth. An affidavit based on information and belief is practically of no value
and is liable to be so regarded by the carrier. Affidavits should consist solely of statements of known facts and not contain conclusions.
Loss or Damage by Delay: The term "loss by delay" is applied to losses sustained by reason of a decline in market price during the period of delay; also to claims for expense incurred by shipper or consignee in consequence of delay.
The term "damage by delay" is understood to apply when freight has suffered physical damage or deterioration as a result of delay. In either case, the length of time in transit is the principal factor.
If the time be excessive, compared with the usual movement of freight of the same general character, the carrier must determine whether the delay was beyond its control and with the knowledge that actual negligence cannot be dismissed, make such restitution as the circumstances merit.
A claim for loss or damage account of delay should be supported by the following documents:
Original bill of lading (if not previously surrendered to the carrier). Original destination freight bill. Original or certified copy of invoice. Original account of sales.
Dispatching Freight: A carrier does not guarantee to transport a shipment by any particular train or vessel, nor in time for any particular market. It is, however, the duty of a carrier to transport a shipment with reasonable dispatch, and to promptly notify the consignee of its arrival at destination.
Damaged Freight Should be Accepted: In the case of physical damage to shipment, due to delay, it is the duty of the consignee to accept the property and in the interest of the carrier, to employ every reasonable means to minimize the loss. It is not a proper practice for consignees to refuse to accept a damaged shipment if repairable or of a salable value. The acceptance of a damaged or delayed shipment does not in any way jeopardize any proper claim which the owner may have against the carrier for loss sustained on account of delay or damage.
Freight Over or Astray: "Over freight" is understood to mean package freight in the carrier's possession without marks indicating consignee or destination but which has become separated from the waybills.
Freight becomes "over" through failure of shipper to properly mark each package shipped, or the labels or tags becoming detached during transportation. If the shipper's name and address does not appear on either package or its contents a claim for its loss results.
It is the rule and practice of carriers to forward astray freight to its destination and to deliver it to the consignee upon presentation to the carrier's agent of proof of ownership in the form of a bill of lading, freight bill or shipper's invoice. Inconvenience to the consignee may arise from the carrier's demand for proof of ownership of the property but there is no other way that delivery can properly be made.
Unclaimed and Refund Freight: While the ownership of a straight consignment is vested in the consignee, the contract for transportation is made between the carrier and shipper. The shipper, therefore, is held responsible for the payment of the carrier's charges and for the disposition of a shipment in the event of its being refused or unclaimed by the consignee. If, in such cases, the shipper does not pay the carrier's charges and have the shipment removed, the carrier will, after a certain period, place the shipment in storage at the risk and expense of the owner, or dispose of it at public auction and apply the proceeds from the sale to the charges due on the shipment. In case of sale, if the proceeds amount to more than the charges, the difference will be remitted to the shipper, but if the proceeds are less than the charges, the difference may be collected from the shipper.
The carrier cannot lawfully waive any charges properly due, except after it has exhausted all legal means of making collections. If a shipment is refused, or unclaimed, the carrier should notify the shipper within a reasonable time.
Perishable shipments refused, or unclaimed by consignee are usually reported by wire to the shipper; but if the commodity is liable to serious deterioration or becomes worthless, the carrier will proceed to dispose of it by sale in advance of advice from the shipper.
Freight is occasionally unclaimed at destination because of the inability of the carrier to locate the consignee. It is, therefore, advisable that bills of lading and shipping orders
for shipments consigned to large cities include the street address of the consignee or the party to be notified.
Tracing Shipments: It is the duty of carriers to transport a shipment to its destination within a reasonable time and they should be given ample opportunity to perform this service before a trace is instituted. The tracing privilege is accorded by the carriers voluntarily and at much expense and it should not be abused by requesting them to start a tracer on a shipment before the time required for its transportation has elapsed, or until the consignee has given advice of its nonreceipt.
In requesting tracers, complete information should be given to the carriers. Requests for tracer should be filed with the agent at point of shipment.
Assignment No. 4
Marine insurance is an insurance against risks connected with navigation.
A loss may be either total or partial.
A partial loss is every loss which is not total.
A total loss may be either actual or constructive.
An actual total loss is caused by:
1. A total destruction of the thing insured.
2. The loss of the thing by sinking or by being broken up. 3. Any damage to the thing which renders it valueless to the owner for the purpose for which he held it.
4. Any other event which entirly deprives the owner of the possession at the port of destination of the thing insured. Constructive total loss is one which gives to a person a right to abandon.
The terms of the marine policy usually provide that in case of damage to labels the loss shall be limited to an amount sufficient to pay the cost of reconditioning, cost of new labels and relabeling the goods, provided the damage will have amounted to a claim under the terms of the policy.
In case of loss or injury to any part of a machine when complete for sale or use, of several parts, the insurers shall only be liable for the insured value of the part lost or damaged.
The insured goods are covered, subject to the terms of the policy from the time of leaving the shipper's warehouse during the ordinary course of transit until on board the vessel, during transshipment if any, and from the vessel while on quays, wharves or in sheds during the ordinary course of transit until safely deposited in consignee's or other warehouse at destination named in policy.
The fundamental of marine insurance contracts are founded on absolute integrity of the contracting parties. Concealment of material facts or failure to report particulars of shipments as indicated in the policy places the protection in jeopardy and may void and claim thereunder.
The lack of uniformity in ocean bills of lading quite often is confusing and particular attention should be given to the various contract terms. Many provisions therein are enforceable at law and may pass unnoticed until the occasion arises. For example, in some bills of lading, presentation of claims for loss or damage must be within a definite limited time after discharge from the vessel and any necessary action at law to follow at a brief interval. Failure to do so in either or both events will invalidate such claim.
Contributory values in General Average vary according to the terms of affreightment and other circumstances involved. The usual practice is predicated upon market value at port of discharge; therefore, to secure the greatest protection, shipment should be insured accordingly. The insurance companies generally, are only liable for the proportion the insured value bears to the contributory value.
The custom in the adjustment of General Average is to levy an assessment on all interests at risk, based upon the arrived landed values, but in order to create a uniformity of practice and to expedite disposition of cargoes (usually an arbitrary value has been fixed) at invoice cost, plus 10% and freight charges added, it being reasonable to presume that the arrived landed value of any commodity, including an estimated profit, would approximate this amount. Therefore, it is incumbent upon shippers, in order to obtain the necessary protection to which they are entitled and which is highly desirable, to insure their goods moving by water lines at not less than the formula as stated above, to wit: invoice cost plus 10% and freight added-as the insur