Consignee Unaware of Tariff Charge

Consignee Unaware of Tariff Charge

Copyright 2003, Traffic World, Inc.

Q:

We have a few vendors who ship to us prepaid and they select the carrier. To have an orderly delivery process we require an appointment for all inbound carriers.

One LTL carrier has billed us $24 for the notification. We object to the charge. We were not aware of it. Most carriers do not charge us and recognize the mutual convenience of the appointment. The carrier claims it is published in its tariff.

What weight does that carry these days? Are consignees still expected to be familiar with a host of potential charges from a carrier they do not have a relationship with? If so, perhaps we could publish our own tariff unilaterally stating that any carrier arriving without an appointment will be charged say $50, arriving late for an appointment $50, etc.

The carrier says he has taken our objection back to the shipper to see if they will pay and they will not, so that''s why he continues to bill us. Total involved is only about six bills or about $150, but I am more concerned with the principle.

Going forward, the carrier recently provided a form letter asking us to verify the need for appointments and advising there will be a charge. I have no problem with that since it at least gives us an opportunity to specify the service needed and advises us of the charge. It also gives us an opportunity to make other arrangements such as advising vendors not to use this carrier.

A:

You''re making me read between the lines a bit, but I''m guessing the notification charge in the carrier''s tariff, like detention charges if unloading exceeds free time, is identified as billed "to the shipment" - meaning to the party whose actions give rise to its application.

That party is certainly you, since it''s your requirement for delivery appointments that''s in issue. And while most carriers build the cost of making such appointments into their base rates, I can''t fault this one for billing it separately. Even the amount doesn''t seem excessive, since appointments entail more than a simple phone call; the driver must time his or her arrival to the consignee''s convenience, which doesn''t do a lot for productivity.

Which is not to say you have to eat the charge. As you point out, your supplier selected the carrier, and I think you''d be entirely within your rights in simply rebilling it for this additional charge - most readily by deducting from your payment of invoices (with, of course, an explanation).

As to your broader question of whether a consignee is expected to be familiar with a host of potential charges from a carrier they do not have a relationship with, the answer is of course not. If you ask, though, whether a consignee may be liable for the charges of such a carrier, yes, it surely may.

To go back to the unloading process, carriers offer individualistic free times and assess individualistic detention charges, and I doubt you''d dispute that you''re bound by both. Even if free time is unrealistically short and detention exorbitant, you have no legal recourse against the carrier. By accepting delivery of the shipment, you''ve also accepted the contract (bill of lading) under which it was transported to you; see Corpus Juris Secundum, 13 C.J.S. ? 478. Therefore you''re bound by that contract''s terms, which if the carrier''s tariff governs include those free time and detention provisions (just as they do the notification charge). Again, any recourse you may have lies in contract law with the shipper, your supplier.

In fact, some purchasers allow their vendors to select carriers on inbound freight-collect shipments, in which case they''re also liable for applicable freight charges and other accessorials - again unknown to the consignee - as well as the additional charges I''ve mentioned.

None of this is different from the era in which carrier tariffs were filed formally and shippers and consignees were required by regulatory law to pay tariff charges. To be sure, the shipper''s or consignee''s obligation to pay is now strictly contractual and carriers may waive tariff charges by ex post facto agreement, but the carrier''s right to its charges remains inviolate.

You have the right idea when you mention instructing your suppliers not to use this carrier. Indeed, I''d suggest much fuller management of your inbound service. Many companies establish "routing guides" of known carriers (with known charges or even contractual relationships), which they transmit to their vendors together with a schedule of penalties if the vendor fails to comply. And perhaps this situation may alert you to the desirability of such a procedure.

Admittedly this is difficult to enforce if you''re allowing inbound freight-prepaid shipments. Also, in the real world you may lack economic muscle to enforce your inbound management. But it''s at least possible to make a sturdy effort in that direction, which is the only realistic way of avoiding the circumstance that you''ve described.

As to establishing your own "tariff" of charges to carriers for missing or being late for delivery appointments, well, one can always try. But the bill-of-lading contract with the carrier specifies that you pay its rates, not that it pay yours, so you''d have no legal basis to enforce such a "tariff" without prior contractual agreement.



-- Consultant, author and educator Colin Barrett is president of Barrett Transportation Consultants. Send your questions to him at P.O. Box 76, Morganton, Ga., 30560; phone, (706) 374-7201; fax, (706) 374-7202; e-mail, BarrettTrn@aol.com. Contact him to order the 536-page compiled edition of past Q&A columns, published in 2001, at $80 plus shipping.