GRS Turkey

Cargo Claims Management & Recovery

A cargo claim is basically a demand for recompensation in respect of financial loss, occurring as a result of shipping contract of carriage or a failure by the transporter to fulfill certain contractual obligations.

Sometimes, the carrier/transporter may not be fully liable to compensate the claimant if the loss is caused under circumstances for which he is exonerated from liability by law or contract obligations.

For cargo claims management both commercial and legal rules used are very important. All commercial cargo by sea on a vessel is carried under some form of contract which implies the obligations and the rights of the parties. Many forms of such contracts are used, like bills of lading, waybills of affreightment, voyage charter parties, each of which has different features. However, main obligations of the carrier/transporter are virtually the same in most jurisdictions.

quantity of cargo,
loading-unloading place,
agreed time,
carrier's custody of the cargo,
bill of lading,
place of discharge/delivery,
discharge as same quantity and condition as received,
delivery to the party legally entitled to receive

are the basic obligations.

These obligations have acceptance in international conventions, likewise the Hague-Visby Rules, Hague Rules and the Hamburg Rules, which have been ratified by many countries in the world. But, one should not assume that the application of similar rules of law in different countries will produce the same outcome simply because they arise out of the same convention. In most cases problems arrise.

Since, cargo claims are so common, the majority of claims handlers in most P&I Clubs deals with cargo claims. There are many variations both in terms of types of cargo, methods of carriage, types of ships, operational aspects, causes of loss or damage, and legal aspects such as jurisdiction, applicable law, exoneration and limitation of liability issues are some of them. A container damage during transport requires different skills than a contaminated liquid cargo claim. These variations in cargo claim parameters makes cargo claims management a professional job where particular skills and experience are needed.

How Cargo Claims Management & Recovery works:

In most of the scenarios, the claims handler receives notification about an incident from the port agent or the local P&I club. Common stories are signs of water ingress into the containers, dropping or carrying damages where a cargo survey is required. The purpose of survey is to find out the nature and the real amount of loss or damage, securing evidences and checking whether parties are taking reasonable steps to mitigate loss. Even these survey services seem to cost a lot, it is quite important not to skip these steps which in turn will result a good compensation when claim is to be well defended.

If there is serious cargo damage involving large quantities of cargo, for instance following a fire, carrier/transporter may also appoint experts and lawyers at the early stage. Lawyers having interview with the Master and crew, collecting relevant ship documents will make connections to third parties, and assist to avoid arrest or detention of the ship or to secure rapid release. They will provide early legal and tactical advice to prevent crew from pressure by cargo interests, claim managers, media or other interested parties. On the other side, the claims handler will collect the cargo survey report with photographs and supporting ship and cargo discharge documents.

Eventually, cargo interests will present their claim.

A cargo claim may be compared to a chess game. The rules that apply to the game are fixed and relatively well-known to the parties. So is the law that applies to the claim. The result is less dependent on the rules than the factual circumstances. Handling cargo claims is not a science. Claims handlers know that reality is not black and white, and that out-of-court settlements are usually a far more economical street than the "Litigation Road".

So, most of the cargo claims are discussed, negotiated and settled short of litigation, usually by way of written correspondence. This is particularly the case in London where some of the most frequently recovery agencies are located. One benefit of such negotiations is that the parties usually know each other professionally, having dealt with each other on several previous occasions. This normally ensures that both sides adopt a reasonable approach and identify quickly the true merits of the claim.

GRS Turkey, with his international partners and professional lawyers (London Courts included), is ready to recover your cargo claims with no cure-no pay rules.