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Proving cargo loss

Proving cargo loss


Shippers in Chicago experience the financial sting of potential loss when their cargo does not arrive at its final destination or if it arrives damaged. State and federal law find that cargo companies are liable for most losses and they must pay to replace the items at full market value, unless the shipper agreed to a lower value for the load before the loss was sustained.

In certain instances, however, carriers may claim that the cargo loss was out of their control in an attempt to reduce or eliminate their liability. Unfortunately, many shippers are unsure of how to effectively prove their losses when this type of situation arises, so they are left covering the entire loss on their own without compensation.

Cargo loss defined

Cargo is considered a loss if goods are lost during shipment, never arrive at their destination, are damaged by natural disasters or accidents, stolen, or by any other means. For example, if a truck driver runs a stop sign and causes an accident in which his cargo is damaged, that cargo would be considered a loss. Partial or complete theft of a shipment, which is occurring with increased frequency every year, is one of the most common forms of loss a carrier can sustain.

How to prove loss

Although the law imposes strict liability on carriers, it does provide some provisions they can use to reduce or eliminate that liability. When goods arrive at their destination damaged, some cargo companies will try to shift liability to others and claim that the items were packaged broken, another transport company on a different leg of the shipping journey is responsible for the loss, or that the cargo was defective and therefore liable to break under normal shipping circumstances.  While the burden of proof most often lies with the carrier, shippers should always be prepared to provide evidence of their position.

A solid business practice for any shipper would be to document the state of the goods to be shipped during the packaging stage and upon their arrival at each destination throughout the shipping process. This can involve documenting the following:

  • How the products were packaged and with what materials
  • How the carrier arranged the products for transport
  • The size of the transport container
  • How the products appeared before shipment
  • How the products appeared after shipment

Each of these should be clearly shown using notes, photographs and film whenever possible to reduce the chance of an incomplete picture should a loss occur.

Cargo loss creates a vastly complex legal situation that has the potential to bankrupt companies. Shippers who are experiencing these situations should contact a transportation attorney to discuss their claim.

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