Introduction

A freight claim or cargo claim is a legal demand by a shipper or consignee against a carrier in respect of
damage to a shipment, or loss thereof.[1] [2][3]

Typically, the claimant will seek damages (financial compensation for loss), but other remedies include
"specific performance", where the cargo-owner seeks delivery of the goods as agreed. At common law,
any carrier has a duty to act with reasonable despatch.[4][5] A "common carrier" may have strict
liability,[6][7] but normally the standard of care is only one of "due diligence", or acting "properly and
carefully".[8]

Legal aspects Edit

The purpose of a freight claim is for the carrier to reimburse the shipper / consignee so as to put them in
the position is if the carriage had been properly had carried out according to the bill of lading.[9][10] For
this reason, claimants are generally expected to file a claim to recover their costs, excluding profits. In
very rare cases some profits may be recoverable, but a court will normally consider lost profits as non-
recoverable economic loss. [11]

In most cases, redress will be paid by the carrier's insurer or P&I Club, and so the law of insurance will
determine quantum of damages. Loss is deemed either "total" (either "actual" or "constructive") or
"partial".[12][13] If the insurance policy is a "valued policy", the amount agreed is, in the absence of
fraud, conclusive (except in cases of "constructive total loss", when the true market value prevails).

Under contract law, claimants are obliged to take reasonable measures to mitigate loss. For example, if
the damaged product has retained some value, the carrier would only be required to pay for the
difference between the original value and the damaged value. The claimant would then be free to
salvage the damaged product by selling it at a reduced cost.[14]

The consignee is entitled to inspect the goods, and to reject them if they are damaged or fail to comply
with description. The inspection should take place at the first reasonable place and opportunity; this will
often be at the consignee's depot or place of business. At the time of delivery, the consignee should
examine the shipment for loss or damage, and should note any issues on the delivery receipt; this will be
used as evidence to back up the claim.[15]
If significant evidence of loss or damage is noticed on delivery, the consignee will be entitled to reject
the shipment,[16] and may also have the option to cancel the entire contract.

If the consignee signs off on the delivery receipt but the damage is concealed (or "latent" or "hidden")
and is discovered only subsequently, a claim will still be allowed provided it is made within a reasonable
time. [17] In this case, the shipper or consignee must show that the damage was indeed caused by the
carrier, rather than by the shipper or consignee.[15][18]

The carrier will normally require the shipper to pay freight (the "shipment invoice") in advance;
otherwise a"clean" bill of lading will not be issued, and the document will declare "Freight Not Paid". In
the event of loss or damage, the consignee would file a freight claim against the carrier for (i) damages
to cover the loss and (ii) reimbursement of any freight paid. The shipper will not be able to make any
claim except as an agent of the consignee.

Carrier liability Edit

The extent of the carrier's is liability may depend upon the shipping mode and the governing bodies. The
Carmack amendment[clarification needed] states that motor or rail carriers are liable for the full loss.
[citation needed] Conversely, the US COGSA states that the carrier is liable for no more than $500 per
package.[19]

In the case of import/export transactions international conventions on limitation of liability may apply.
[20][21]

Article IV of the Hague-Visby Rules lists more than 17 exclusions of the carrier's liability. Other
international conventions such as the Hague Rules, the Hamburg Rules and the Rotterdam Rules have
similar provisi