Temperature and Claims

Most traders in produce and agricultural goods know the importance of temperature during transit, especially if the product is delivered F.O.B.  It the cold chain is broken, a receiver may be liable for the price of the load, depending on the degree by which the chain was broken, the moment  and the duration of the break.  For this reason, shippers frequently include one or more recorders in a load to provide a record of cold chain maintenance during transit.

What is less known is the consequence of a “lost” temperature recorder.  The shipper places a recorder in the load and “oops” the recorder is not discovered upon unloading and the load arrives with problems.  The courts and the USDA have seen this “problem” before.  Generally there is a legal presumption that a recorder has been “lost” or better stated discarded because the temperature record would have shown a cold chain break which would have been unfavorable to the receiver.  The law presumes that the receiver destroyed the evidence that would have shown a cold chain break which would cause the receiver to be responsible for the loss on a FOB load.  (This is only a presumption and the law allows for the possibility of the receiver providing another explanation for the missing recorder.)

We recommend that our shipper not only include a temperature recorder in the load, assuming that the load value is sufficient to justify the cost.  In addition, we suggest that our shipper also include a diagram with the shipping documents to show the exact location of all recorders placed on the load, so as to reduce the chances that the recorder would be “overlooked”.  If this is the shipper’s standard practice, the chances of a receiver claiming that the recorder was lost or could not be found are reduced and the chances of a successful claim against the shipper are reduced.

CASES OF NOTE

With Holy Week, there were not too many cases of note filed relating to agricultural shipments in the US.

Hop Sing Produces, Inc. v. MJM Trading, Inc., et. al, United States District Court, Eastern District of New York   In this case Hop Sing seeks to recover $33,000 from MJH and its principals under the PACA trust.

Maspeth Trading, Inc., v. X & L Supermarket, Inc, et al.  United States District Court, Eastern District of New York.  X & L Supermarket is the defendant in one more PACA case, in addition to the one we noted in cases of note in our last blog post.  In this case, X & L is being sued under PACA for $42,000.