Air Cargo Law Claims Complaints

Claims & Complaint Handling, Air Cargo Law, Insurance
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It is generally accpeted that the main contractual obligations of the carrier are to deliver a shipment:
  • -In the same state in which they were accepted, undamaged
  • -Complete: in number of colli, and in contents (contents only as far as checked and agreed)
  • -On time 

Based on the original air waybill copies, the shipper and consignee have the right of disposition over the cargo shipped under the air waybill.

In case the customer of the carrier is not happy with the services delivered, he can file a complaint or a claim:

What is a Complaint?
-A complaint can be defined as:  An official statement from a customer about his unhappiness with the service or operation of the service provider.  A complaint can be issued in the form of a letter, an e-mail or a phone call, generally directed to the customer service organisation of the carrier. 

What is a Claim?
-A claim can be defined as: A written complaint about any aspect of the performance of an organisation in relation to a contract, combined with a demand for financial compensation. Main categories for claims are:
  • -Damage : physical damage to the shipment
  • -(Partial) loss : loss of an entire shipment, or one or more entire parcels from a larger shipment
  • -Theft / pilferage) : loss of items out of a parcel, or a (partial) loss of a shipment that is certainly caused by theft
  • -Delay : delivery of the shipment later than the agreed or reasonably expected delivery time

Claims from an end-customer to a forwarder, or from a forwarder to an airline or, in more general terms, also from a carrier to a subcontractor, must be filed timely according to the applicable transport conditions, either as a full claim or as a preliminary claim notification.  It is important to always mention the air waybill number and flight / routing when a claim is filed.  And it is important for the forwarder / airline / carrier (or other parties in the chain) to immediately back-up the related shipment and operational information from the IT-systems involved.

The right to claim is laid down in the contractual conditions and applicable law.

Applicable law
-Apart from the contractual conditions, almost all international transportation by air is regulated by international treaties known as the Montreal Convention or the Warsaw Convention (with several amending Protocols).
-National Aviation laws may also apply.  They cannot overrule the international treaties, only extend regulations not specified in the Montreal or Warsaw Convention. 

-For the air transport, or airport-to-airport part, the contracting carrier (= the carrier who’s (master)air waybill is used) as being the prime contractor is responsible towards shipper and consignee for the acts and omissions in the execution of the contract performed by its own employees and/or its agents.   It is basically the task of the forwarder (as the agent for the shipper and/or consignee or end-customer), to file a claim at the airline in case something goes wrong.
For the forwarding, or the door-to-airport or airport-to-door part, the contracting forwarder (= the forwarder or NVOCC who’s (house)air waybill is used) as being the prime contractor is responsible towards shipper and consignee for the acts and omissions in the execution of the contract performed by its own employees and/or its agents or subcontractors.  In case something goes wrong in the whole contracted door-to-door transport, the party who contracted the forwarder (e.g. the shipper or the consignee) should claim a file at the forwarder for this.

-The liability of the carrier is limited ; allowed claims are compensated with a standard amount per kilogram.  This is unless grove negligence, wilful misconduct or fraud on the part of the carrier can be proven, or when the air waybill is missing.

-Because the standard compensation of allowed claims will often be lower than the actual financial loss, the customer can consider additional insurance.  This can be arranged for a specific shipment via the air waybill if the carrier provides this additional service, or by means of a separate (overall or specific) company transport insurance. 

Applicable law vs conditions
-International carriage by air is subject to international law as laid down in the Warsaw Convention (1929) for all countries that have ratified this international treaty. Several amendments were made afterwards, of which the most important ones are:
In 1999 international legislators (read: governments) came together again in Montreal for an entire revision of the convention, in which several industry standards issued by IATA (= airlines!) were incorporated. This time, the result was not a further protocol to the Warsaw Convention, but a new ‘Montreal Convention’. This convention became effective on November 4th, 2003 between the thirty states that had ratified it until that date. Further ratification by individual states remains open for each of those Conventions and Protocols. 
-A very limited number of countries have never ratified any international treaty with regard to air transportation. Carriage to and from such countries is therefore not ruled by international law. In such cases the Conditions of Contract as printed on the reverse of the Air Waybill and the General Conditions of the carrier apply. These conditions also apply to all carriage governed by the Warsaw / Montreal Conventions as far as they do not conflict with the applicable version of the law. 
-In all cases, domestic laws may apply as well, as long as they are not in disagreement with applicable international laws (Warsaw / Montreal Convention). 

See also: Air Cargo law or Aviation law here on Wikipedia or here via Google


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Anonymous said...

Sir we are export company based in Mumai India, we were exporters of fresh produce perishables by air to middle east through out freight forwarder. we stopped shipments due to losses by mismanagement and bad services provided by the said freight forwarder. now the freight forwarder has sent us a lawyers notice for claim of payments. in fact we had asked them for a claim against our 3 shipment lossess amounting to closure of our busnisses.any advice how to handle the situation.

Anonymous said...

freight agent takes premium priority rate for perishable cargo for a client on a first cum first basis by charging Rs. 110 /per kilo leaving aside other customers cargo on hold with out informing them , this game played in hand with the cargo manager of the airline ,my company was the victim for this particular agent and our perishable cargo was kept on hold without any intimation by the freight agent or the airline have all proof on record, and in spite of this loss the freight agent sends a lawyers notice demanding payments of Rs. 250,000 with threats from the said is we the the exporter who should be claiming our losses amounting to Rs. 480,000 for 3 shipments mismanaged by the said FREIGHT AGENT in MUMBAI...

Roland Spijker said...

Hi Anonymous, in this case both the forwarder and the airline seem to have screwed up your perishable shipment. Besides this, they should have protected your cargo to keep it cool. Normally you should claim at your forwarder and the forwarder at the airline (if applicable). Them claiming at you would seem quite strange, I think they are just trying. This is a thing for your lawyer, your contract / house waybill with the forwarder and/or the air waybill conditions are leading in this. Make sure to timely and formally claim at the forwarder as well as the airline in writing. And I hope you have perhaps a cargo insurance. I feel sorry for you and wish you a lot of success... If possible, perhaps together with your lawyer following your claim you could try and seize goods and/or the bank account of the (owner of) the forwarder so you block his business, that sometimes helps if the case is judged good enough. And also claim lost business due to closing of your company.

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edunote said...

Cargo insurance provides protection against all risks of physical loss or damage to freight from any external cause during shipping, whether by land, sea or air.

CargoCover believes that properly insuring freight, in conjunction with good physical risk management, is an important way to manage the financial impact of loss or damage. Our coverage includes options to insure from “warehouse to warehouse,” irrespective of the number of subcontractors involved, and covers common carrier limitations such as: “Acts of God,” terrorism, strikes, riots, and civil commotion risks.

Subject to certain packing exclusions, this freight insurance policy pays regardless of which carrier is ultimately responsible for the loss or damage.

Includes coverage for General Average. Without cargo insurance, this event can have a frustrating economic impact on your customers, as they will be responsible to put up a bond to have their cargo released even if it is not damaged.

This freight insurance policy will cover the goods for the full value declared and will not be subject to the limitation of a carrier’s bill of lading.

If you are handling third party cargo, cargo insurance is a value added service that also helps you manage your cargo liability exposure, since our CargoCover solution does not subrogate against the party who arranged the cover.

Protect your errors and omissions insurance from liability claims, as you are not absorbing the deductible applicable to each claim under your legal liability policy.

Some carrier’s liability is calculated based on the weight of the shipment, and may be limited to a few hundred dollars. With CargoCover, your client is fully protected and you will not have a claim made against your liability insurance.

With full direct damage freight insurance, the burden of proof of liability is waived and claims are handled directly between the insurer and the customer. Insurers then subrogate where possible.

Put simply, cargo insurance provides a cost effective way of covering your customer, as well as yourself for physical loss or damage to goods in transit. It provides added value to your customers and helps differentiate you from your competition.

Anonymous said...

I have send a 43 inch television via sitex cargo from madina saudi arabia to india hyderabad. However it is six months now i did not recieve it. Also there is no clear reply from the cargo company. Kindly let me know where can i make an official complaint..

Roland Spijker said...

Hi Anonymous if you sent your TV via Sitex, then Sitex is responsible - you have a contract with them, and they should reclaim at their suppliers / the airline if needed. If Sitex does not react take your contract and communication to a specialised lawyer asap and see what they can do then... Hope this helps, success brgds R.

Anonymous said...

Hi. That is a good web site and probably a place where I can get help. I placed an order with Chinese supplier who shipped my goods by air using EMS courier. 57 days later the item is still not with me and the tracking info says "Awaiting custom clearance". Usually that delivery service takes 4 days to be delivered. That is not my first time importing these goods and the Customs does not required any documentation from me. I would like to know how long time after the shipment of the goods by air the item is considered lost in transit?
Thank you in advance for your help
Best Regards

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ParcelCompare Discount Codes said...

Thank you for letting us know about the Aircargo complaints and claims. I never knew that there was actually a difference between claim and complaints. I termed both as the same. But you have helped me realize I was so wrong.

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Claiming a compensate after a long delay from airline is a tough task. Thanks to providers like Flight Claim, who are there to help us in such situations.

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