Date: Mar 02, 2016

One of my first blogs written back in May of 2013 was on “Never Request a USDA Inspection.” In most circumstances that rational still holds merit, as it is the responsibility of the buyer to demonstrate a breach of contract, i.e. failing to make good arrival standards, which can only be determined by securing a USDA or Canadian Food Inspection Agency (CFIA). As the shipper, you have no obligation to prove there is a problem with your product, thus the reasoning to require the buyer at contact destination to establish the documentation and basis for any alleged breach. That said, this blog will highlight a few exceptions where it may well be in your best interest, as the shipper, to secure an inspection. These exceptions come into play when there is a representation of a potential carrier claim, and your sales contract is either on a delivered basis, or on an FOB sale, when you have agreed with your customer to take responsibility and step into the shoes of the buyer to move the load and resolve the potential claim with the carrier directly.   

It is under these two types of circumstance that you, as a shipper, want to ensure a USDA or CFIA inspection is secured the same day or the following day with all the original lot available for inspection. In order to have any basis for a potential carrier claim, you must prove damage to the shipment on arrival. Simply having a rejection without proof of a third party inspection such as a USDA or CFIA inspection documenting damage, will almost always  jeopardize your standing to prevail with your claim.

While a carrier may possibly consider a qualified in-house, the best indisputable evidence is a USDA or CFIA inspection. The USDA or CFIA inspection will not only detail condition defects with the product, but also include pulp temperatures and other critical details of what the produce appeared like at the date and time of the inspection.   

Another critical aspect of minimizing the potential loss with the claim is the rapid movement and sale of the rejected load. Unless you are working with a trusted carrier, I strongly recommend that rather than rejecting the shipment to the carrier, your first and best option is for you to arrange for its placement for the account of whom it may concern. In doing so, advise the carrier that you are having the shipment moved to mitigate damages, and that this action does not release the carrier from any possible liability. Rather, your action is in the best interest of all parties to maximize the return from the distressed product. Typically, you have better contacts with wholesalers, which may result in better returns. Further, instruct the receiver to return any proceeds, along with a detailed account of sales in order to properly document your actual loss. In this situation, always be sure to keep the carrier fully informed of your actions once the rejected load has been placed with the receiver. With the carrier fully informed, taking such action and documenting your efforts by email does not invalidate responsibility from either the carrier or the original customer.

For additional information on handling a claim situation, I encourage you to review my previous blog, “Rejections: Manage your Rejected Product, Maximize Your Return and Protect your Rights to Make a Claim for damages”.

Western Growers regular members can utilize my services to review and help you interpret your USDA or CFIA inspections, temperature downloads, as well as discuss possible PACA or truck claims. Please email me at TommyO@wga.com with a copy of the USDA inspection certificate or call me at (949) 885-2269.

WG Staff Contact

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