Damages Under the Carmack Amendment

Kevin Anderson Cargo Liability, Transportation

Damages is a legal term of art that refers to the monetary harm a person or company suffers in any given case. Every area of law has its own method, rules, and laws that determine the damages for a particular case, and the Carmack Amendment is no exception.

Under the provisions of the Carmack Amendment a carrier is liable for the “actual loss or injury to the property” in a Carmack Amendment Case. 49 U.S.C. § 14706. And while on paper that is a simple approach, the actual amount in damages is not necessarily a simple thing to determine. For example, issues arise when damaged property was needed in a timely matter and causes a business to lose money because they do not have the expected cargo.

Examples like these, and others, make the work of calculating damages in a Carmack Amendment case a complicated affair. But there are certain principles that apply to Carmack Amendment cases laid down by the courts.

9th Circuit Court of Appeals on Damages

The 9th Circuit Court of Appeals established some of these principles in the 1981 case, Contempo Metal Furniture Co. v. East Tex. Motor Freight Lines, Inc., 661 F.2d 761 (9th Cir. 1981). That case involved a complicated damages calculation when a shipper left metal tubing in the rain where it rusted and pitted making it unusable to the shipper’s customer. The defects, though, were not fully detected until the customer tried to use the metal but determined that it would not work. Because they used the tubing it reduced its salvage value, and both sides offered conflicting reports of what the money damages actually were in the case.

In its ruling the court determined that the general rule for damages under the Carmack Amendment is:

  • “the difference between the market value of the property in the condition in which it should have arrived at its destination and its market value in the condition in which it did arrive.”

But at the same time, the 9th Circuit has recognized that this rule is not absolute. As a result, each case must be looked at according to this general rule, and the actual damages calculated based on what was lost by the carrier.

For example, if a carrier could foresee that loss of property or damage to cargo could result in money lost for the shipper, that lost money could factor into a damages calculation at trial. Of course most defendants will fight this issue, and any claimant will have to fight to establish the actual damages they suffered because of property loss or damage.

A Trucking Law Firm for Your Company’s Needs

Because of the fact and law that goes into each Carmack Amendment damages inquiry, your case needs the experience and knowledge of trucking law attorneys. At Anderson and Yamada, P.C., our law firm is dedicated to trucking law issues and case. If your company has a Carmack Amendment issue, contact us. We look forward to going over your case with you and counseling you on your legal options.