February 2007 | Commentary | Risks and Rewards

Shifted Contents, Shared Responsibility

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Q: My warehouse often receives containers holding cargo that has shifted or collapsed against itself. Apart from any risk we face for cargo damage while unloading the containers, I feel this also presents a hazard to my workers. What can I do to protect my company and my employees?

A: Unfortunately, containers often house improperly stowed goods and the results can be costly, deadly, or even fatal.

In one recent case, a consolidator received an inbound container that was unloaded for Customs examination. After the inspection, the consolidator reloaded the container and arranged for inland shipment to its final destination.

When workers at the receiver's facility opened the container, the cargo had shifted—cartons were leaning against one of the container's doors. One workman entered the container through a narrow space to see how the cartons were stowed. As he stood in the container, several cartons fell from the stow, crushing his hand and arm against the container door.

Another case featured a shipment of steel tubes packed in an upright position in wooden crates, which were loaded overseas. The container did not have straps in place to prevent the crates from toppling over.

When it arrived at its final destination in the United States, workers used a forklift to remove its contents. At one point in the operation, several crates fell over and landed on a worker standing inside the container, fatally crushing him.

These kinds of accidents happen not only at the destination point, but also during the transportation process.

Several years ago, a number of railroads faced recurring incidents involving steel coils breaking loose during shipping. The coils would shift or pierce through their containers, at times causing derailment.

As a result, the railroads began demanding indemnifications from shippers for damages caused by improperly stowed cargo. While the railroads' concerns were warranted, their actions addressed the direct shippers—frequently steamship lines and logistics operators that were not involved in the stuffing process.

The U.S. Occupational Safety & Health Administration has enacted mandatory standards to ensure that employees receive proper training on industrial equipment. Employers must certify that they have trained their employees; failure to do so subjects the employer to civil penalties.

But these standards lose impact when a container is loaded by unknown entities in a foreign country. Companies may have no involvement in the loading process, but still face the risk of being named in a lawsuit.

Protecting Yourself

So, what can businesses do to mitigate these risks?

The best place to address this problem is at the point of origin. Companies purchasing or selling goods should agree to a policy governing the most appropriate method for stacking and stowing goods for transit. Consolidators should use best practices to stow the goods they handle.

Keeping abreast of and conforming to current industry standards is key. Numerous industry publications contain information about proper methods for securing goods for transit, addressing issues such as choosing the proper container, devising an effective packing plan, engaging in appropriate packing and proper labeling, and issuing correct carriage instructions.

Finally, if you receive a container that presents potentially dangerous conditions, think twice before attempting to unload it. If you choose not to reject the shipment, be sure to notify your shipper, carrier, and insurer about the container's condition.

Request instructions from your insurer, and seek assistance from a qualified cargo surveyor.

Have a liability question or concern? I will try to help. Please send your questions to me via e-mail at: dan.negron@thomasmiller.com.

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