Bonded Customs Warehouse Has Lost Our Shipment

[Rebecca H 1]

Hi,

 

Wondering if anyone can offer advise before we go into what will I am sure, become a battle for compensation.

 

My business partner & I went to Indonesia in February to design and buy goods for our shop and online business. As it was our first trip doing this we took a couple of weeks to set up our contacts etc. We shipped the goods back in 6 crates. The goods arrived and were cleared through customer by a broker called Global Fallow.

 

We organised pick up of the goods, it was very stringent and had to give the registration number and drivers details of the vehicle collecting as the goods were being held in a bonded warehouse owned by Hemisphere.

 

When the driver arrived he was told they hadn't been released through customer. After a few phone calls this was sorted and he went again only to be told that they couldn't fond the pallets.

 

This was 2 weeks ago. Apparently our goods were stored under a mezzanine floor and weren't fully visible to the CCTV. They have apparently contacted all haulage companies who came through. {over what time span I don't know, not sure if t was just the day or from when the goods arrived] and they have all said that they didn't have any extra pallets.

 

They have done a warehouse sweep and can't find them either. This is not a small shipment, so I am finding it hard to understand how 6 pallets can disappear.

 

Noe comes the fun bit. We called FSB who advised us to claim for loss of profit. We would have marked up x 5 and this would have covered the cost of our trip, the shipping etc. I know that they won't want to pay this so I am asking if anyone on here has any experience of this type of case. I am reading all sorts of things on google about consequential damages etc but it would be great if we could know how to word our letter to them so that we can speed things up.

 

We timed it so that the goods would be on our shop floor for our very busy season, we are in Cornwall and this is our best selling time and now we have missed that and even if we get the money quickly the goods will not arrive in time to maximise the selling opportunities.

 

Naturally we are very upset and cannot understand how this could have happened in what is meant to be a secure warehouse.

 

Any help or advise will be much appreciated,

 

Best

 

Rebecca

[SuperVillain 400]

What was the value of the goods lost?

[Rebecca H 1]

the goods cost us £5000.

[Rebecca H 1]

we've been advised to put a claim in for what we would have sold the goods for. This will cover our expenses for sourcing the goods etc. We've been told that the bill of lading is the contract we will have to refer to, but I am sure that this won't cover us!!

[honeybee13 4,570]

we've been advised to put a claim in for what we would have sold the goods for. This will cover our expenses for sourcing the goods etc. We've been told that the bill of lading is the contract we will have to refer to, but I am sure that this won't cover us!!

 

Hello there.

 

Who advised you to do that please?

 

HB

[SuperVillain 400]

In my opinion you could potentially claim for loss of the goods (i.e. the cost you bought them for) and the loss of profit from selling the goods (i.e. the mark up).

 

Therefore I would suggest you seek legal advice. If you bought the goods for £5k, a x5 mark up would be £25k loss of profit if my maths is right. Together with interest, this is a claim in excess of £30k.

 

It's been a while since I've done any commercial law although from memory, the bill of lading is proof of shipping, and the incoterms detailed on the bill are the terms on which the goods are shipped - this is particularly important as the incoterms determine who bears the risk and when this transfers from buyer to seller, e.g. if its FOB (Free on Board) your seller in indonesia bears the risk until the goods are on the ship after which you assume the risk - only applies to boats. Contrast with say DAP (Delivered at Place) where risk transfers at a place named in the contract.

 

However, the suggestion is that the goods arrived safely at the warehouse and then lost from there - as such I don't think the bill of lading is the only appropriate contract and your T&Cs/Contract with Hemisphere or Global Fallow should be considered.

 

This isn't a straightforward issue, so you need to seek specialist legal advice in my view.

 

Although if you're still intent on making enquiries yourself, look into whether the goods were insured by Global Fallow/Hemisphere (assuming you didn't insure them yourself).

[steampowered 3,176]

Hi there

 

The first thing is to establish who was liable when the goods went missing. Is there any proof they arrived at the warehouse? Did you have a direct contract with the warehouse or did you only deal with them through the broker?

 

Once you've identified who might be liable, it is perfectly possible to claim for loss of profit, if the loss of profit would have been predictable to a reasonable person.

 

However, most companies will exclude any liability for loss of profit in their T&Cs. Were you provided with a set of T&Cs when entering into a contract (e.g. in an email) and if so is there a 'limitation of liability' clause in there please?

[Rebecca H 1]

Hello everyone,

 

So an update. The goods haven't showed up. I have spoken to the person who deals with insurance claims for Globelink Fallow, the shipping agents. Apparently we have to make a claim against them and then they claim against the warehouse. She told me that we will be bound by the bill of lading as that is our contract. This will not even cover the cost of the goods but willl pay us $2 per kilo of shipped weight which was 423 kg. I was also told that it's pointless trying to sue for negligence against the warehouse as it will be too costly and too hard to find an expert in this type of law. The only T & C's are on the bill of Lading.

 

We have been naive, I accept that. I assumed that insurance would be included with our shipping cost. The only paperwork we received was when the agent sent us the documents just before the ship docked via DHL. We then had to send the bill of lading to Globelink Fallow.

 

I only spoke to the shipping again initially but then called the warehouse to see what they were doing about tit. They told me it shouldn't happen and that it was human error. This is 6 crates of goods on 3 pallets. They said that they have contacted all the haulage companies that come to the warehouse and none of them had any extra pallets and that they had doe a sweep of the warehouse again, but nothing. I find this incredible but I am at a loss.

 

~I could understand if they had gone missing in Indonesia or if a container had fallen off the ship, but the last thing I expected was that they disappear in a UK warehouse.

 

We are members of the Federation of Small Business who advised us initially to put a claim in for the gross profit of the goods, but we haven't go that far yet.

 

I am at a loss as to what to do next, fight it or just accept the $846!! It just seems very unfair. Any further advice would be very much appreciated.

 

Rebecca

[steampowered 3,176]

Hi,

 

What do the T&Cs on the bill of lading say? Do they actually say you can only claim $2 per kilo?

 

Were you shown the T&Cs before you instructed the shipping agent?

 

I was also told that it's pointless trying to sue for negligence against the warehouse as it will be too costly and too hard to find an expert in this type of law.

This is simply nonsense. Basic negligence claims are straightforward. Any solicitor in the country should be able to manage a basic negligence claim - basic negligence is among the first topics covered at law school, it is not a specialist area. Although as you engaged the shipping agent I would have thought it would be more straightforward to claim against the shipping agent in the first instance.

[Rebecca H 1]

We were not shown T *& C's. We only saw the Bill of Lading when the goods arrived.

 

I feel we have a strong case for negligence?

[Rebecca H 1]

Yes, they state $2 per kilo but I am buying a magnifying glass tomorrow as the type is so small I can barely read it

[Rebecca H 1]

Hopefully someone might be able to offer some further advice. After waiting for weeks this is the response we have received. Any help, advice would be much appreciated as we are having trouble understanding how they can treat this so lighly, it really is unbelievable

"I write to advise that RSA are the Goods in Transit liability insurers for Hemisphere Freight Services and we are therefore dealing with this claim on their behalf.

 

I understand that Cream Cornwall contracted with Globelink Fallow to arrange the transport of the above consignment from your suppliers in Indonesia to your premises in Southampton.

 

Following arrival of your consignment in the UK, it was taken to the premises of Hemisphere Freight Services (HFS)who were contracted by Globelink Fallow to devan (unload) the contents of the container – which included consignments for other customers. Globelink Fallow contracted separately with the road carriers to collect the relevant consignments from the premises of HFS in order to deliver them to the final customer; once the transport vehicle arrived at the premises of HFS, they loaded the relevant consignment onto the vehicle for despatch to the consignee.

 

It seems there was an error relating to your consignment whereby it was loaded onto the wrong delivery vehicle and despite attempts by our insured to trace the whereabouts of your consignment, they have been unable to locate it.

 

Whilst it is unfortunate that your goods cannot be traced, we must point out that such errors do occur from time to time in the movement of freight and in such circumstances, any liability that attaches to any of the parties involved will be determined by their trading terms and conditions.

 

As Cream Cornwall contracted direct with Globelink Fallow any liability attaching to your Freight Forwarder will be based on the terms of their Bill of Lading – a copy is attached for your information.

 

However, as the involvement of Hemisphere Freight Services was as a subcontractor for Globelink Fallow, our insured’s contractual terms will apply as this was the contract agreed between these two parties.

 

Hemisphere Freight Services operate under BIFA terms and conditions which limits any liability attaching to them by reference to the weight of the lost/damaged goods. The limitation is 2 SDR’s per kilo; the current SDR rate is 1.062780. Based on the weight of 423 KGs for the 6 crates, the maximum liability attaching to our insured is therefore £899.11.

 

I understand there is a shortfall between the limitation fund available to our insured and the value of your goods and it is for this reason that it is recommended that customers take out cargo insurance on their goods, in order to protect their interests.

 

Globelink Fallow have advised us that you have intimated that you may seek legal advice on this matter; this decision is clearly at your own discretion. However, we would point out that in circumstances where any liability attaching to Globelink Fallow or Hemisphere Freight is determined by their terms and conditions, it is likely that you will still only receive a reward based on the limitation fund under BIFA terms – which are recognised by the UK Courts. As such, you should be aware that you may incur additional costs that you are unable to recover. .

 

I therefore trust the above clarifies the contractual position of our insured. In the event that you have any queries relating to the points raised above, I would be happy to discuss them with you; whilst I am away from the office today, I will be returning tomorrow so please feel free to contact me on the number below."