RECENT BOL UPDATES AND THEIR IMPACT ON THE RELATIONSHIP SHIPPER/CARRIER

On July 14, 2016, the National Motor Freight Traffic Association (NMFTA) issued Supplement 2 to NMF 100-AP, which became effective August 13,2016. The biggest impact the addition of Supplement 2 are the modifications to the Uniform Bill of Lading (UBOL), specifically the terms and conditions. These changes will greatly impact proof of liability as well as the ability to recover loss and damage claims.

The industry is not taking this change lightly, and the proposal received significant push back and was challenged on July 29, 2016 by both the TLC – Transportation & Logistics Council (PNG Logistics Co. is a member of TLC ) as well as the National Shippers Strategic Transportation Council, Inc (NASSTRAC).

The petition was denied by the Surface Transportation Board on August 12, 2016, but the controversy in general poses the question of why this is so important to the industry, and how it may potentially be detrimental. The main source of contention by both the TLC and NASSTRAC is that the change in language switches the burden of proof regarding carrier negligence. In the new version, the burden to prove carrier negligence is on the shipper, whereas in the old version, the carrier needed to prove that they were not guilty of negligence.

This simple switch in terminology creates a dramatic change in centuries of law and its interpretation in similar scenarios. The shippers are most upset by the fact that none of their input was considered prior to making this fundamental industry change, and the end result will likely invite carriers to avoid liability and lead to conflicting court decisions. Shippers claim those changes undermine decades of legal precedent and will make it harder for shippers, especially small businesses, to collect loss and damage claims from motor carriers, a claim the NMFTA, which represents carriers, denies.

When the shipper passes his goods along to the carrier, he has no way to know what the carrier does with his goods, so it would be virtually impossible for them to prove that the cause of the loss or damage was the carrier’s ‘negligence’. The NMFTA council is stating that the new language does not change the burden of proof, and that the carriers aren’t trying to evade or avoid anything, merely attempting to clarify. The shipper groups widely disagree, and view these charges as reversing the more than a century old burden of proof that was established under the Carmack Amendment.

Part of shippers’ objections are that these changes were made unilaterally by the NMFTA without any input or comment from shippers (unlike changes to the classification itself, which specifically provides for shipper input.

We will keep you posted with any developments pertaining to this situation and in the meantime if you would like more information please do not hesitate to contact us at sales@pnglc.com or 717-626-1107 x 3 .