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Thursday, October 20, 2011

Cargo damage & claims:- Failure to instruct cargo terminal resulting in reefer cargo damage

Any reefer cargo needs constant monitoring during transport to maximize product shelf life and ensure higher market value for products at destination market place.
Refrigerated container temperature control equipments that include reliable microprocessor controllers, controlled atmosphere, extremely low temperature containers, dehumidification, and environmentally friendly CFC (chlorofluorocarbon) free boxes. Selecting the right container for your cargo, ensuring correct stowing & securing practices, are critical . Whenever any cargo damage occurs, answers are sought as to why, where and when it occurred, reinforcing the commitment that whoever is responsible for damage is also accountable for it.

Importers of wine from France to the United States had previously encountered problems with consignments imported through New York during the winter months, when the wine could be subjected to sub- zero temperatures causing it to freeze and lose its quality.

In response to this problem, the line issued instructions that asked the agent to instruct the terminal operator to open the container as soon as it was delivered and place portable heaters inside to keep the temperature in the container above freezing.

Unfortunately, the agent failed to give the necessary instructions with respect to a cargo of nine containers of wine. While eight of the containers suffered no damage the carriers received a claim for US$120,000 for freezing damage to the remaining container.

A claim was made against the Agent, and after lengthy negotiations a satisfactory settlement in the sum of US$32,650 was agreed.

Ironically, most reefer cargo damage occurs not because of technical reasons, but due to poor communication systems, management practices or administrative procedures. Most of these losses could have been avoided if appropriate checklists had been made and strictly adhered to, and the systems followed. Weak links in the chain of information need to be strengthened.

ITIC (International Transport Intermediaries Club) Claims Review reports that there have been an increasing number of claims (varying between US$15,000 and $150,000 in value) resulting from reefer containers either being left unplugged at the load or discharge port or being carried at the incorrect temperature.

Our detail pages below examine some typical cases of damage to reefer cargoes & countermeasures against future claims