Law – March 2004

Owner-Operator Independent Drivers Association filed a petition with the Department of Transportation requesting that the bond required of transportation brokers be raised from $10,000 to between $300,000 and $500,000. “The $10,000 bond comes nowhere close to covering the amount of unpaid liabilities incurred by many brokers today,” OOIDA President Jim Johnston said. “OOIDA and its members have learned time and time again of individual brokers each failing to pay tens of thousands of dollars, if not hundreds of thousands of dollars, in transportation charges to dozens of motor carriers.”

Prime Inc. was awarded $559,718 by a U.S. District Court for court costs incurred battling a lawsuit filed by the Owner-Operator Independent Drivers Association over alleged federal leasing violations. OOIDA plans to appeal the decision.

Small Business Administration was recognized at the annual awards luncheon for its creation of, which features interactive tools, searchable frequently asked questions and answers, downloadable forms and publications, electronic regulatory compliance guides and links to online transactions.

Labor relations attorney Stephen Cabot, who has helped non-union trucking companies remain union free and worked with union and non-union companies on ways to maintain employee morale, has published a guide for handling workplace issues. For more information on Stephen J. Cabot’s Complete Guide to Labor Relations in the 21st Century, call (800) 835-0353.

Q Due to the new hours rules, we now impose a one-hour freetime rule for truckload loads. We have particular difficulty getting detention charges when consignees are responsible. Can we hold them liable?

A Ordinarily, detention and other accessorial charges are included with freight charges on the invoice sent to the shipper. When the shipper does not incur the detention, though, it often refuses to pay. What is needed is a way to pass carriers’ detention bills on to the responsible party.

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It is well established in railroad law – from which motor carrier law is derived – that a consignee becomes liable for demurrage, the rail equivalent of detention, when a rail car is spotted at a consignee’s location for unloading. Both the uniform bill of lading and the standard truckload bill of lading used by motor carriers provide that the consignee will pay all lawful charges accruing on shipments. This language tracks the federal statute (Section 13706) establishing that the consignee is liable for additional rates and charges due after delivery unless it gives written notice before delivery that it is not the beneficial owner of the goods.

So it seems clear that a motor carrier can bill the consignee for detention on prepaid shipments based on the carrier’s rules or operating circulars incorporated into the bill of lading by reference. But the carrier’s rules tariffs can be trumped or negated if a carrier signs a contract that expressly supercedes the tariff, waives detention charges or otherwise precludes collection of detention from the consignee.

Although it is possible to hold a consignee liable for detention on prepaid shipments by protecting rights through properly drafted rules circulars and contracting practices, this is not enough in the truckload marketplace. Consignors of collect shipments and consignees on prepaid shipments traditionally haven’t been held responsible for detention.

So I believe that it’s only fair that you notify your contracting shipper’s customer or vendor in advance that you intend to hold it responsible for detention. It appears that most consignors and consignees insist on appointments for pickups and deliveries. I recommend sending appointment confirmations via fax or e-mail that explain the carrier’s expectations regarding live loading or unloading, including references to free time, detention and the liability of the party incurring the charges for paying them.

Because drivers cannot extend their time available for driving by logging off duty when they are held up at a loading dock, let the shipper or consignee know that it will ultimately bear expenses caused by dock inefficiencies.