Cargo claims: the documents and deadlines that decide the settlement

A marine cargo claim is a documentation exercise conducted under time pressure. The cover is usually not in dispute. What gets disputed is whether you preserved your rights against the carrier, and whether you can prove the loss occurred during the insured transit.

The first action: protect the recovery

Your insurer, having paid you, will pursue the carrier by subrogation. If your actions have destroyed that right of recovery, the insurer's position - and your claim - is prejudiced. So the first thing to do on receiving damaged goods is not to notify the insurer; it is to protect the claim against whoever carried them.

Note the damage on the delivery receipt before signing. A clean receipt signed for a damaged container is the single most damaging document in a cargo file. Where the container arrives with a broken seal or a seal number that does not match the documents, record that specifically.

Issue a written notice of loss to the carrier immediately - within three days for most road and sea carriage, and considerably shorter for air. These notice periods are short and unforgiving.

A clean delivery receipt signed for a damaged consignment is worth more to the carrier than any argument you make afterwards.

The survey

Notify the insurer at once and request a surveyor. Do not unpack further, repair, dispose of or sell damaged goods before the survey. Keep the packing, the container and the seals available for inspection - the packaging often shows how and where the damage occurred.

Photograph the container externally with the number and seal visible, the goods as found on opening, and the damage in detail. Take more photographs than seem necessary. The surveyor's report is the central document in the file, and it is written from what can still be observed.

The document set

The insurance policy or certificate. The original bill of lading or airway bill. The commercial invoice and packing list. The delivery receipt with the damage noted. The copy of the notice served on the carrier and any reply. The surveyor's report. A claim bill setting out the amount claimed with its calculation.

Where relevant: the shortlanding certificate from the port, the container interchange receipt, weighment slips, and the customs examination report. Where the goods are repairable, repair estimates; where they are a total loss, evidence of disposal or salvage value.

Time bars

Claims against carriers are subject to statutory time limits that are much shorter than general limitation periods - commonly one year from delivery, or from when delivery should have occurred, for sea carriage. Air carriage is shorter still.

These deadlines run regardless of how negotiations with the insurer are progressing. Where a claim is still open as the limit approaches, an extension has to be obtained from the carrier in writing or suit filed to preserve the right. Files are lost on this routinely.

The recurring failures

Clean receipts signed under time pressure at delivery. Notices to carriers served late or not at all. Goods disposed of before survey. Invoice values that do not match the declared insured value. And missing evidence that the goods were in sound condition when shipped - which a pre-shipment inspection or dated packing photographs resolve inexpensively.

None of these are coverage questions. All of them reduce settlements, and all of them are decided by what somebody at a loading bay did in the first hour.