- Take pictures of damaged goods before unloading
- Make a note on the consignment note (CMR) that the goods have been damaged and obtain a signature from the driver
- Notify the transport manager/ Freight Fowarder immediately
- File a complaint within seven days of the day of unloading
WHAT TO DO IF YOUR GOODS HAVE BEEN DAMAGED OR LOST IN TRANSPORT?
AS Arco Transport makes sure that the goods entrusted to the customer for transport are loaded as compactly as possible and secured in such a way that their transport is safe both for the goods themselves and for fellow road users. However, sometimes the delivered goods have been damaged in the transport chain, either in the form of damaged packaging or the goods themselves have been partially or completely destroyed. Of course, in such a case, the disappointment is great, because as a rule, the goods already promised to the customer were expected, and with the possibility that it will not arrive or at least does not look the same in the color advertising images of catalogs, none of us want to take into account. How to behave?
IF THE GOODS ARE DAMAGED OR DEFECTIVE, WHAT TO DO FIRST?
Leaving the emotions in the background, immediately inform the carrier about the externally damaged goods, submit a claim for damage (it is not necessary to have fixed exact quantities), and prepare a report on the spot, noting the result on the delivery note. The report should be the result of a bilateral or independent examination. A claim against the carrier for concealed damage to the goods must be submitted in writing no later than within seven days from the date of receipt of the goods (CMR art. 30.1). As a rule, only after the damage examination (report) can the customer file a formal claim for damages against the carrier, which must state or to which must be attached: the carrier’s liability (transport order), shipping documents, expert report, calculation of compensation payable by the carrier.
WHEN IS THE CARRIER LIABLE FOR THE DESTRUCTION OF THE GOODS?
As a general rule, the carrier is responsible for the preservation of the goods from the time of receipt by the consignor until delivery to the consignee. The damage to the goods must have occurred during the carriage and through the fault of the carrier. The carrier is presumed to be at fault for the damage to the goods if: the goods are in packaging suitable for transport; the carrier himself/herself instructed the loading or confirmed the goods independently; no third party has been identified who is demonstrably at fault for the damage to the goods. It is important to know that the carrier is not liable for damage to the goods if they were presented and confirmed by the consignor without the driver’s participation, or if the packaging is obviously insufficient for his/her undamaged transport to the destination, taking into account physical rules and road and weather conditions. When goods are damaged during transport due to insufficient packaging, consignors or consignees often tend to argue that the carrier should assess the suitability of the packaging for transport when receiving the goods. Such a claim is unfounded since Article 8.1 (b) requires the carrier only to check the external condition of the packaging and not to assess the suitability of the packaging. If the packaging or goods are damaged upon acceptance for carriage, the carrier shall make a note on the consignment note with an indication of the nature of the damage. The carrier is liable for goods damaged in a traffic accident caused by the carrier. However, if, for example, the goods have been damaged as a result of a traffic accident in which the other party involved in the accident has been found guilty, the culprit is known, and the carrier is released from liability to the owner of the goods (CMR Art. 17.2). If the carrier has intentionally damaged the goods, the limits of his/her liability are not limited according to the CMR Convention. (CMR art.29.1)
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WHEN IS THE CARRIER RELEASED FROM LIABILITY TO COMPENSATE THE DAMAGED GOODS TO THE CUSTOMER?
The carrier shall be released from liability (CMR art. 17.2) if the loss, damage, or delay in delivery of the goods was caused by the claimant’s own wrongful act or negligence; as a result of instructions are given by the claimant himself/herself which were not caused by the wrongful act or negligence of the carrier; defect inherent in the goods; circumstances which the carrier could not avoid and the consequences of which he/she was unable to avoid. That this was the case must be proved by the carrier. Therefore, the carrier is released from liability under Article 17.2 if the damage, destruction, or delay in delivery of the goods was due to a traffic accident caused to the carrier by another person. It is assumed that in this situation, it was not possible for a reasonably prudent driver to avoid an accident or injury. In such a case, the owner of the goods must forward the claim to the person who caused the damage or his/her insurer.
The carrier shall be released from liability if the loss of or damage to the goods is the result of a special risk which is inextricably linked to one or more of the following: .. (b) where the damage was due to defective packaging (absence or defect of packaging in cases where goods transported without packaging or without proper packaging may, due to their natural characteristics, deteriorate or be damaged); or (c) the loading, installation, securing or unloading of the goods by the consignor (CMR 17.4.b, c) If the damage to the goods is caused by compliance with the claimant’s instructions, the carrier need not prove that they are incorrect. It is sufficient for the carrier to prove that the damage was caused by following the instructions given.
The carrier is also released from liability if the damage is related to the natural characteristics of some types of goods, which may result in total or partial loss or damage, in particular, due to breakage, corrosion, rot, drying, leakage, normal loss or parasites (CMR 17.4.d) Article 18.2 of the CMR provides: When the carrier establishes that in the circumstances of the case, the loss damage could be attributed to one or more of the special risks referred to in article 17, paragraph 4, it shall be presumed that it was so caused. The claimant shall, however, be entitled to prove that the loss or damage was not, in fact, attributable either wholly or partly to one of these risks.
It follows that if the consignor loaded and secured the goods independently or did so under his/her direct instructions, it is presumed that if the consignment breaks down, it is the consignor’s and not the carrier’s fault. It is also difficult to blame the carrier for broken goods when the packaging of the goods is intact or, conversely, obviously broken. Consequently, such packaging is not sufficient to transport the goods. The purpose of securing goods is to protect them from damage that may occur during transport as a result of the natural vibration or jolting of the truck. The securing of the load must be sufficient to enable the carrier to brake, if necessary, without the goods moving in the vehicle. The rule of thumb could be this: if the goods are secured by the carrier, he/she is responsible for their quality; if the sender secures the goods, the latter also has the responsibility that the goods remain intact.
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TO WHAT EXTENT IS THE CARRIER LIABLE FOR DAMAGED OR LOST GOODS ?
All international road transport is subject to the CMR Convention, and the mutual rights and obligations of the contracting authority and the carrier of the goods, as well as the limits of liability, are established there. The most important thing is to know that the carrier’s liability is limited financially per package by weight of the goods and is 8.33 SDR per gross kg, i.e., approximately 8.33×1.25*=10.40 euros (*as of November 2015. The rate fluctuates) for each kilogram of goods damaged. In simple terms, this means that the carrier has no obligation to reimburse the full cost of the damaged or destroyed goods if the goods were more expensive than this ceiling, and the customer has no legal basis to demand this from the carrier. (CMR art.23.3) In case of damage to relatively light and high-value goods, the owner of the goods cannot receive 100% compensation from the carrier for the lost or damaged goods. AS Arco Transport recommends: in order to avoid possible damages, always insure the ordered goods with goods insurance, which is generally not expensive considering the possible damages.
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IS THE CARRIER LIABLE FOR LATE DELIVERY OF GOODS, AND HOW?
Delay in delivery shall be said to occur when the goods have not been delivered within the agreed time limit or when the time required for making up a complete load in the normal way exceeds the time it would be reasonable. (CMR art.19) In the event of a delay in delivery, the liability of the carrier is limited by Article 23.5, according to which the claimant is not entitled to compensation for the delay in excess of the carriage charge paid to the carrier. In any case, the claim must be made within 21 days, and the claimant must always be able to prove the extent of the damage caused by the delay.
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WHEN CAN GOODS BE CONSIDERED COMPLETELY LOST IN TRANSPORT?
The fact that goods have not been delivered within thirty days following the expiry of the agreed time limit, or, if there is no agreed time limit, within sixty days from the time when the carrier took over the goods, shall be conclusive evidence of the loss of the goods. (CMR art.20.1)
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DOES THE CARRIER HAVE TO BUY DAMAGED GOODS FROM THE CUSTOMER?
The customer is compensated for the actual or real damage from the destruction of the goods on the basis of the delivery notes, and the amount of the damage must be proved by the consignee/customer, not the carrier. In the event of partial loss of or damage to the goods, the carrier’s liability shall be calculated pro-rata in accordance with Article 23.3. The carrier shall be liable for lost or damaged goods in the same proportion as the gross weight of the damaged part of the goods relates to the gross weight of the entire cargo. In practice, this means that in the event of damage, the cost of, for example, replacing the damaged part or material with a new one minus the possible residual value of the damaged material, taking into account EUR 10.40 per kilogram, is reimbursed. It is wrong to assume that the carrier is forced to buy the damaged goods from the customer in any case. Generally, he/she is not.
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IS THE DAMAGE AMOUNT TAXABLE?
If the carrier is obliged to compensate the customer for the damaged goods under the CMR Convention, he/she shall compensate for the decrease in value. It is not a sale and purchase transaction within the meaning of the Tax Act, and the applicable VAT does not have to be added to the recoverable value. Indeed: it is unlikely that a transport company, as an interested party, would buy, for example, half a load of broken wine bottles or a completely unusable wardrobe on an invoice and then account for it. As no value is added upon the destruction of the goods, the submitted claim is not shown under realization, and, of course, no turnover is generated. The indemnity received is other business income, such as an insurance indemnity. As VAT is, by its nature, a value-added tax and the owner’s accounts show the difference between the VAT received from his/her customers on the sale and the VAT paid on his purchases, which is declared and passed on to the State, the customer does not incur any additional costs then the customer does not incur any additional costs by writing off the goods. The customer’s tax burden is 0.- EUR. AS Arco Transport compensates the damage caused during the transport to the customer on the basis of a substantiated claim, which indicates the quantity and value of the damaged goods according to the delivery notes.
*The publication has been used to assist in the preparation of the explanations
“Juice, Renee. CMR Convention. Comments. Ilo Print 1999.275lk.”