Subcontractor Causes Troubles for Motor Carrier

Kevin Anderson Cargo Liability, Contracts, Transportation

The old adage of you are only as strong as your weakest link holds true with the link of different players that are typically involved in shipping goods from one state to another. Because of these complex relations, one breakdown with one or more of the players can put a company at risk, and cause severe damage to reputations, bottom lines, and company survival. This was the lesson learned as a trucking company lost an entire truckload of lobster recently.

A news report from Massachusetts explains that a trucking company is being sued over a lost or stolen load of lobsters that could cost that company hundreds of thousands in legal fees and damages. The story reports about a lawsuit filed in federal court in Massachusetts that is claiming the shipping company is liable for an entire load of lobsters that was supposed to end up in California, but was stolen somewhere along the way. If proved, the case will likely hurt the company financially, and will damage their reputation, as well.

The story alleges that the shipper contracted with a motor carrier company to pick up and deliver several hundred thousand dollars worth of lobster from the east coast to California. The motor carrier, as often happens, hired a subcontractor from a public listing to finish the job. The only problem is that the lobsters never made it, and the subcontractor disappeared from the scene.

Take Care in Hiring Contractors

As a result of all this, the company is facing a lawsuit of over $300,000. These kinds of situations are not always avoidable, but many times they can be. Having the right policies and procedures in place for a company can ensure that the only reliable subcontractors are used to move goods. It is also helpful to have such policies in place when a suit is filed, to show that a company was not negligent in hiring, but did all they could to make good hiring decisions.

The right kinds of policies aimed at avoiding these costly mistakes, and laying framework to defend a suit can be created under the advisement of qualified legal counsel. Preventing lawsuits should be the first priority, and preparing to defend lawsuits should be a close second.

Liability Under the Carmack Amendment

Having the right approach is so important because of a national policy that favors holding carriers liable for lost, damaged, and stolen cargo. This policy is embodied in the Carmack Amendment, and is uniform across the country. The Carmack Amendment says that carriers are liable for any damage, loss, or theft of cargo that is shipped across state lines, unless the liability was limited in a contract (which meets specific criteria) prior to shipment. It is heavy handed against carriers, no matter what they are shipping.

At Anderson and Yamada, we have decades of experience helping trucking and transportation companies establish policies, get through litigation, and every other aspect of trucking law. No matter the size of your company, we are the transportation law firm for companies throughout Oregon and Washington. Contact us today.