How to Notate Damages and Shortages on the Bill of Lading and Proof of Delivery
It’s much easier to win a cargo damage or shortage claim when the proper process is followed. Correctly notating damages to the bill of lading (BOL) and proof of delivery (POD) is a good start, but there’s more you can and should do to prevent further complications.
So what’s the protocol when your shipment arrives with visible damage, concealed damage, or a shortage? For all cargo claims, you have nine months to file your claim. Below is a guide on how to strengthen your case when you find damages or a shortage a shortage or damages to your shipment. This article is the first in a series of three blog posts about the claims process.
If your shipment is visibly damaged, you should provide an accurate and clear report of the issue. The precise nature and extent of the damage should be notated on the POD. If you are certain there is damage to the product, you should:
- Write why you think there is damage.
- Notate any damage to the packaging that suggests further damage.
- Avoid writing “subject to inspection” or “possible damage” because neither states specific damage nor are such notations considered valid.
For all visible damage claims, the claimant must file the claim within nine months of the date of delivery.
If you signed the delivery receipt without a damage notation but your shipment has been damaged, contact your Echo rep immediately. Notice of concealed loss or damage must be provided to the carrier within five business days from the date of delivery, which your Echo rep will do on your behalf. This does not change your claim into “visible damage” but rather establishes a time frame within which the damage could have occurred. Make sure to have evidence of the notification through email. Phone notifications must be followed up with an email to confirm. If you wait until after the five-day notice period to inform your Echo rep of a shortage or concealed damage, your claim will most likely be denied. For all concealed damage claims, the carrier must be notified within five business days of delivery. After that, the claimant must file the claim within nine months of the date of delivery. Read our second blog in our damages and claims series, "How to Report Concealed Damage to Your Shipments."
Unlike concealed damage, which can hint at possible freight damage via the packaging, shortages often go undiscovered until after the driver leaves. Shippers can avoid this extra hassle by taking steps to prepare for it. On the BOL, the shipper can request or require the driver to count and sign for the number of pieces in your shipment. However, this must be agreed upon prior to pickup. If there is no agreement or contract in place, it should be discussed with the carrier prior to pickup when the load is initially offered to the carrier.
Be aware of abbreviations made by the driver that limit the carrier’s liability. These include:
- STC (said to contain): The driver is not assuming responsibility for any number of pieces but rather a number of pallets that are “said to contain” a number of pieces.
- SWP (shrink-wrapped pallet): The driver is taking responsibility for picking up a shrink-wrapped pallet and not the piece count.
In the event of a cargo claim for lost freight, the above notations limit the carrier’s liability for case shortages. For example, if a shipment consisting of 40 cases on two pallets is tendered to a carrier, the driver will likely sign the BOL with “2 pallet STC 40 cases.” In doing so, the carrier is only responsible for the quantity of two pallets. In the event the receiver notates “1 case missing,” it is not likely the carrier will be held accountable, as that person only signed for two pallets (not the number of cases).
Finally, on the POD, make sure to notate any discrepancies in the packaging, especially if the shrink wrap is torn, missing, or suggests that the product was repackaged (e.g., the color of the shrink wrap is not the typical color used by the shipper). For all shortage claims, the claimant must file the claim within nine months of the shipment date.
Work with Echo to File Your Claim
Communication and transparency are essential to addressing shipment shortages and damage. If your shipment is affected, follow the steps outlined above to strengthen your claim and resolve the issue. Our established relationship with carrier partners ensures fairness and a hands-on approach as we help you navigate the claims process and verify the proper steps are followed. For other claim types, you can contact an expert at Echo to support you through the process.