There needs to be timely notification in order to have an effective rejection by your customer, the receiver.  While, you as the shipper, may have an obligation to take back the shipment, keep in mind that if it is later determined the rejection was wrongful, your customer could be held liable for the original contract price and incidental expenses, less any resale proceeds received by you.

So is timely notification an important component in achieving an effective rejection?

Ken Gilliland

The answer is yes and no.  Yes, you retain Trust rights providing that your invoice reflects payment terms as PACA Prompt or Net 10 Days. This protection allowing for printed language on the invoice is extended to licensees of the PACA.  All other non-licensees are required to submit a written statement to preserve Trust rights. 

No, if your invoice provides any terms beyond the 10 days, and you do not have a signed agreement for those extended payment terms.

Ken Gilliland


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