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June01, 2015

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84 THE JOURNAL OF COMMERCE JUNE 1.2015 Q&A TOP 100 IMPORTERS AND EXPORTERS By Colin Barrett BLUSTER OVER IMPACT ON NMFC CHANGE Q: SUPPLEMENT 1 TO the National Motor Freight Classification, NMFC 100- AO, hit our radar this week. It provides for: (1) Reducing from 15 days to five the time for shippers and receivers to provide notice to carriers of concealed damage. (2) Establishing 180 days for the filing and collection of claims for duplicate pay- ment of freight bills. It appears the Commodity Classifica- tion Standards Board didn't follow its own rules and procedures for docketing these changes and allowing for public comment. I protested Supplement 1 to the CCSB, and was told the changes didn't require docketing. The board said the reduction in time for concealed damage notification was simply due to the increased use of electronic communications in business, to avoid undue delays in processing such claims. It further said the time limit for duplicate payment claims isn't new, and is simply a restatement of provisions previ- ously incorporated in the NMFC. I think both provisions should be elim- inated from the NMFC. Because antitrust immunity no longer applies to the NMFC and the CCSB, I wonder if the possibility of collusion could apply to the provisions of Supplement 1. A: I THINK YOU'RE MAKING HEAVIER weather of these changes (to the extent that they are) than really warranted. You must, or should, be aware that nei- ther has any legal effect on the rights of the parties. The amount of time "allowed" for notification to carriers of concealed damage doesn't impact a claimant's legal right to recover such claims. At most, it's simply a declaration by car- riers participating in the NMFC of their intent to dispute claims where notification isn't provided within the stated time. As long as a claimant can prove the damage occurred in tran- sit, its right to collect on the claim is undiluted. To be sure, a carrier's unwilling- ness to pay such a claim voluntarily is an inconvenience and an annoyance. In that regard, the change isn't incon- sequential, inasmuch as it can subject the claimant to the need for costly and uncertain litigation. Certainly, the possibility of antitrust-violating col- lusion is one that might be explored, especially given the CCSB's failure to docket the reduction in time for claim- ants to report concealed damage to carriers. That strikes me, though, as an issue that would have to be examined on a case-by-case basis. The matter of the purported time limit on duplicate payment claims is something else again. The former Interstate Commerce Commission long ago ruled that duplicate payments — involving a shipper's inadvertent payment of the same carrier freight bill twice — are distinguishable from over- charges, and aren't covered separately by federal transportation law, Dupli- cate Payments of Freight Charges, 350 I.C.C. 513 (1975). After the law was changed to pro- vide a 180-day time limit for shippers to "dispute" carrier freight bills, 49 U.S.C. Section 13710(a)(3)(B), the Surface Transportation Board revisited the issue in National Association of Freight Transportation Consultants — Petition for Declaratory Order (unpublished, NOM-41826, served April 21, 1997), with ambiguous results but essentially reaffirming the ICC ruling. Thus, basically duplicate payment claims in transportation are no dif- ferent from those in other economic sectors. That is, they're governed by general civil law, including time lim- its. I can find little case law about the time restriction for filing such claims, but it seems to vary from state to state and doesn't seem to be very firmly established. What's clear, though, is that no carrier tariff rule or provision, whether individual or collectively established in the NMFC, has any impact on the legal time limit for a shipper who's had the misfortune of double-paying a carrier's bill, nor can it limit that shipper's legal right to recoup its erroneous payment. In sum, these provisions of Supple- ment 1 are nothing more than sheer bluster. Yes, I admit this language could inf luence an improperly or inadequately informed court in decid- ing claims of this nature, but the role of an attorney for such a shipper is to make sure the court isn't improperly or inadequately informed. As long as its case is presented effectively, no ship- per/claimant should have its rights adversely affected by this language of the NMFC. That's why I think you're over- reacting to what amounts to a legally ineffective effort by the NMFC carrier participants to short shippers on time in asserting either type of claim. In neither instance are the shipper's rights before the law compromised. Your efforts might be better directed toward other areas of the ongoing conflict between shipper and carrier interests. JOC Consultant, author and educator Colin Barrett is president of Barrett Transportation Consultants. Send your questions to him at 5201 Whippoorwill Lane, Johns Island, S.C. 29455; phone, 843-559-1277; e-mail, Contact him to order the most recent 351-page compiled edition of past Q&A columns, published in 2010. The role of an attorney for such a shipper is to make sure the court isn't improperly or inadequately informed.

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