What Should You Do With A Rejected Cargo Load?
December 30, 2015
Author: Chris Tauger, Sales Executive
Unfortunately loads get rejected. There are many reasons a load could be rejected. Some of these examples are change in temperature, wetness, dampness, or a broken seal. It can be a helpless feeling sitting at the receivers dock with a rejected load, compounded with the feeling that you do not have the time or money to keep this load on your truck. Most truckers do not know where to start or what options they have. The first thing that needs to be done is contact your insurance provider. They can help guide you through the process. Even though the load has been rejected, rarely will it lose its value. Second is to review your broker contract. Typically the shipper will have wording in the contract that will allow them a final say in how the load will be disposed of. This typically requires written consent.
In the event of a time sensitive load such as refrigerated or frozen goods, it is fundamentally important that the buyer obtain a USDA inspection to support its contention that the product does not meet the negotiated contract terms of sale. In some isolated cases, the buyer may still choose to refuse the load even in the face of overwhelming evidence to the contrary. The buyer has a reasonable time after receipt of the product to reject it and this is defined by the PACA. The PACA defines reasonable time of rejection by truck as “… not to exceed eight hours after the buyer is given notice of arrival and the product is made accessible for inspection.” It should be noted that this reasonable time covers regular business hours. Therefore if the product arrives on a non-working day, those hours are not counted into the reasonable time. Once a rejection is made, it has to be determined whether or not it was a rightful or wrongful rejection.
How is it determined whether or not it was a rightful or wrongful rejection? First, the product needs to be dealt with and removed from your truck. The claims adjustor and shipper should help you immediately find a home for the product and have it sold as quickly and as effectively as possible in order to minimize damages. The best practice is to find a warehouse to offload the goods. The claims adjustors will then try to obtain salvage bids from local & national buyers. They will reach out to as many as they can but typically will have at least 3 bids. On non time-sensitive loads, this process can be completed in 4 days. Take ownership of the problem and control of the product to manage the money from the salvage. Getting the insurance company involved as early as possible makes sense to maximize the return to you and reducing the claimed damages.
What happens if the product cannot be resold/salvaged? In the event that the claims adjustor and shipper instruct you to dispose of the product, there are new applications designed to help the truckers find local food banks. Food Cowboy, is a mobile app that connects unwanted food with charities. Truck drivers have a unique perspective on waste, especially those who haul food. They see loads rejected for trivial reasons such as damaged packaging, and they often end up throwing it away. Food is wasted because it is perishable and expensive to move, so when it can’t be sold, it usually ends up in dumpsters. Getting that food to the hungry requires real-time information about where it is, what it is and where it needs to go. The Food Cowboy app gives truckers that information. Food banks pay 10 cents for every pound of food. The food supplier then gets to write off the value of the load on their taxes as a donation. It’s a win-win situation for everyone. 48.1 million Americans lived in food insecure households, including 32.8 million adults and 15.3 million children. Food insecurity exists in every county in America, ranging from a low of 4 percent in Slope County, ND to a high of 33 percent in Humphreys County, MS. Consider this option as you dispose of or salvage your freight.
Knowing which options you have for a rejected load will help you expedite the process and get back on the road quickly. Remember the best thing to do is get your insurance provider and shipper involved right away. When possible, please consider mobile apps like Food Cowboy, who is inviting everyone to take part in keeping the planet and its people healthy.
- Food Cowboy App – www.foodcowboy.com
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