In this installment of PARCEL Counsel, we will take a “sneak preview” of two of the presentations at this year’s PARCEL Forum. For the first time in many years, I will not be attending the Forum; however, my colleague, Andrew Danas, a Washington DC attorney, will be presenting in my stead. His presentation will be, “Avoid These Top Four Legal Issues,” and he will also be participating in the “Navigating International Parcel Shipping” panel.
As transportation attorneys, we are frequently asked to identify the major legal issues that pose risks to parcel shippers when shipping domestically and internationally. The short answer is that these risks fall into four categories:
· Not knowing your contract parties.
· Not knowing the terms of the contracts affecting your transactions.
· Not knowing the rules and regulations that govern your shipment.
· Not having a compliance program that will minimize or avoid these risks.
Not Knowing Your Contract Parties. Too often, shippers do not fully evaluate either their customers or their transportation providers. There are multiple risks in not having sufficient background information.
For example, is your contract counterparty authorized to do business and credit worthy? Is it on any domestic or international government sanctions lists? Does the engaged transportation provider have proper licenses and operating authorities?
Is it actually a carrier or is it in fact a non-carrier intermediary? If an intermediary, do you know the identity of the actual carrier? What assurance do you have that if you pay the intermediary, the intermediary will pay the carrier?
Not Knowing Your Contract Terms. It is very common for parties to engage in commercial transactions over a long period of time without paying attention to “boilerplate” contract terms, only to discover to their surprise at the time a dispute arises the binding legal terms of the relationship. Have you actually received and reviewed the terms and conditions of all contracts? Are there any terms that are incorporated by reference contained in a carrier’s tariff or on a website? If you signed a credit agreement or another document, did that document incorporate terms and conditions by reference… and give the issuing party the right to change those terms at any time?
Not Knowing the Rules and Regulations Governing Your Shipment. There are many rules and regulations creating legal obligations for shippers. Do you know these obligations when tendering goods in domestic or international surface, air, or ocean transport? Do you know a shipper’s obligations under the federal HAZMAT regulations and under US import and export laws, including US sanctions laws? What about US anti-terrorist laws?
Not Having a Legal Compliance Program. By now, it should be clear that taking pro-active steps to adopt procedures to address these risks is a key component to minimizing them in shipping goods whether internationally or domestically. Having a basic legal compliance program, with a checklist of dos and don’ts in various transactions, is the first step that any shipper of parcel goods can take in mitigating legal risk.
To sum up, while these topics will be addressed at PARCEL Forum, for readers not attending the Forum, it should be noted that these topics have been discussed in previous PARCEL Counsel columns and we will continue to do so in the future. All for now!
Brent Wm. Primus, J.D., is the CEO of Primus Law Office, P.A. and the Senior Editor of transportlawtexts, inc. Previous columns, including those of William J. Augello, may be found in the “Content Library” on the PARCEL website. Your questions are welcome at firstname.lastname@example.org.
This article originally appeared in the September/October, 2021 issue of PARCEL.