Whether Cargo is Lost or Stolen, The Carmack Amendment Applies

Kevin Anderson Cargo Liability, Transportation

Recently a federal district court handed down an opinion on the applicability of the Carmack Amendment when cargo is stolen en route. While a plain reading of the Carmack Amendment shows that a carrier will be liable for lost or damaged cargo, it does not specifically address the issue of stolen cargo. A defendant in a recent case tried to use this omission to his advantage, but to no avail.

This case is just another example of how important the Carmack Amendment is to the trucking industry. When it comes to claims over damaged, lost, or stolen cargo the claim begins and ends with the Carmack Amendment. As such, truck companies should be familiar with its provisions and implications.

Facts of the Case

The title of this case is Annett Holding, Inc. v. AI Trucking Service, LLC., Case No. 4:14-cv-3948-RMG (D. South Carolina Aug. 2015), and it involved a contract to transport cargo from South Carolina to North Carolina. The cargo to be transported included 21 reels of cable under a prevailing rate and by way of a contract between the two parties.

During transport the carrier discovered that his tractor was having mechanical problems. As a result, he disconnected his tractor from his trailer and took the tractor into the shop to have it fixed. But when he returned to where he left the trailer and cargo, both were stolen and gone. While unfortunate for everyone involved, the shipper was left holding the bill for the value of the 21 reels of cable, and so he sued to recover his damages under the Carmack Amendment.

Court’s Ruling

The court heard all the arguments from both sides, and made a summary judgement decision in favor of the shipper. The carrier’s primary argument in the case was that the Carmack Amendment does not specifically address liability for stolen cargo, and therefore they should not be held liable for the loss. And this argument does have some merit.

Setting aside the issue of whether the driver was negligent for leaving his trailer parked and not guarded, the shipper had a good argument. The main thrust of an argument like this is that one should not be held liable for the criminal acts of another. But when it comes to cargo liability the Carmack Amendment is clear. The carrier is liable for the cargo when it is in their possession, from pickup to delivery. And this is what the court held in this case.

In its ruling the court decided that to take the carrier’s argument would be to read the Carmack Amendment too formalistically. It would also neglect the plain meaning of the Carmack Amendment. As a result, the court held for the shipper, and the carrier was liable for the damages that happened when the cargo was in their possession.

A Carmack Amendment Law Firm

The Carmack Amendment is part of every aspect of shipping cargo. So it is important for trucking companies to know the basics of the Carmack Amendment, but it is even more important that your company’s attorneys have a solid understanding as well. At Anderson and Yamada, P.C., we look forward to serving your company’s needs. Contact us today so we can assist your company and provide you with the competent legal services you deserve.