As a shipper, it is prudent to fully understand both your contractual obligations and your rights when handling a potential rejection. A shipment cannot be deemed rejected if it is either:

  1. Unloaded (except for the purpose of inspection); or
  2. Unilaterally diverted during transit

Under PACA law, both such actions constitute acts of acceptance. For proper cause, your buyer may reject a shipment by providing a prompt and proper notification to the shipper. The PACA defines timeliness in rejecting a shipment as:

Bryan Nickerson

Several Western Growers members recently asked me for a checklist of questions to ask when product arrives at contract destination when there has been a federal inspection secured. In other words, can we provide a guidance document to the sales staff to ask the correct questions and determine, with accuracy, liability under the terms of the sales contract.   

The following is a checklist of questions that I require the answers to before an opinion can be rendered for a WG shipper as to whether or not a commodity complies with contract at destination:

Bryan Nickerson

Shippers often call me to discuss the results of their timely USDA inspection and for help determining if it meets contract specifications. There are two distinct types of defects listed on the inspection that can help you determine that. When reading a USDA inspection certificate, the inspector will list two types of defects: Quality (or permanent) and Condition.

Bryan Nickerson

Fresh produce shippers are used to dealing with unique retailer demands getting their product to market. One such challenge, first introduced by Walmart U.S. in 2017, is the retail giant’s on-time in-full (OTIF) policy. As the name indicates, this logistics compliance program requires product to arrive at Walmart’s distribution centers on time and in full. Shipments that arrive early, late, short, or not otherwise as specified in the Purchase Order, are all subject to fines. 

Bryan Nickerson

When a buyer is entitled to keep product but is unwilling to renegotiate the original sales price with you on a shipment that has “failed to meet contract specifications at contract destination," how do you determine what the adjusted price should be? What if there is no meeting of the minds on an equitable settlement or adjustment? If you are unable to agree on amending the original contract, the next step is calculating provable damages.

Bryan Nickerson

Whether you are establishing a sale or amending a sales contract, here are some helpful reminders to be aware of when using PAS (Price after Sale) sales terms. Afterall, PAS  (also referred to as open price sale or open sale) does not establish a consignment or an agency relationship. With everything already agreed to but price, it is a straight buy-sale relationship. No detailed account of sales is required, and the buyer must pay the fair market value or a price mutually agreed to between the parties.

Bryan Nickerson

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Produce Insights

Stay up to date with best practices for selling and shipping fresh produce with our insider blog. Produce Insights offers expert guidance on all things related to PACA, product arrival issues, product guarantees, collections on slow pay, disputed contracts and so much more.

Members have relied on information from Western Growers when they’re in a pinch – trusting in our team's vast experience working with the produce industry, the DRC, CDFA, USDA and PACA to save them millions of dollars over the years.

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