What is the Carmack Amendment?
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What is the Carmack Amendment?

| Oct 8, 2020 | Firm News

Liability is a major concern in the transportation industry because of the involvement of multiple entities in each situation. For example, in a situation where a company is shipping goods, you have the company that owns the goods, the company transporting the goods, the driver and the company accepting the goods.

At various points in the process, there is a potential for something to go wrong, which means any of the entities could hold liability for the shipment. To make things clearer, the government enacted the Carmack Amendment.

The amendment

According to HNI, the Carmack Amendment came about in 1935. The idea was to create uniformity in the rules about interstate shipments. It helped to assign liability, duties and rights for shippers and carriers in the event of a loss of cargo.

Liability

The amendment states that the carrier is liable for any damage to the goods that occurs during transport. There is no requirement to prove negligence, but the carrier can prove it is not negligent. This will usually come from exceptions mentioned in the amendment.

Exceptions

The exceptions that allow a carrier to avoid responsibility for cargo damage include any damage that happens as a result of war, terrorism, military actions or government orders. It also includes damage from natural disasters or other issues due to nature.

A carrier also is not liable if something the shipper did cause the damage, such as loading the cargo incorrectly. In addition, if the goods were naturally subject to damage or issues, then the carrier is not liable. For example, food will spoil within a certain amount of time, so barring any actions on the part of the carrier that might lead to spoilage, if it happens, it is a natural expectation for which the carrier holds no responsibility.