Loss of Cargo & Liability of Freight Forwarders in India | Legal Advice for Freight Forwarders in Delhi NCR | Legal Advice for Cargo Forwarders in Gurugram
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In India, like in many other countries, the liability of freight forwarders in case of cargo loss is governed by legal regulations and international conventions. However, they can face liability for loss of cargo during transit. The liability of freight forwarders is often determined by the terms of their contract with the shipper and relevant laws. While some liability might be limited due to the nature of their intermediary role, forwarders can still be held responsible for negligence or failure to fulfill their obligations. Adequate insurance coverage and clear contractual agreements are essential for both parties to manage potential cargo loss and liability situations effectively.
Role of Freight Forwarders: Freight forwarders are intermediaries that arrange the transportation of goods on behalf of shippers. They handle different parts of the transportation cycle, for example, booking freight space, orchestrating documentation, organizing with transporters, and giving coordinated factors arrangements. The worldwide exchange scene vigorously depends on proficient and secure transportation of products across borders. Cargo forwarders assume a significant part in working with this cycle, going about as delegates among transporters and transporters. Nonetheless, the complicated trap of worldwide transportation implies inborn dangers, including the deficiency of freight during travel. Despite their intermediary role, freight forwarders can be held liable for certain actions or failures.
Liability Framework: In India, the liability of freight forwarders is determined by various laws, contracts, and international conventions. The primary law governing liability is the Indian Contract Act, 1872. Additionally, the Multimodal Transportation of Goods Act, 1993, covers the liability of multimodal transport operators, which includes freight forwarders.
Liability for Loss of Cargo: Liability of Freight Forwarders in India
Freight forwarders are generally not carriers themselves but act as agents for carriers. Freight forwarders are generally not carriers themselves but act as agents facilitating the transportation process. Therefore, their liability for loss of cargo is often limited. Consequently, their liability for the loss of cargo is limited by default. Notwithstanding, they can be held at risk under particular conditions, for example,
• Negligence: If the cargo forwarder neglects to practice sensible consideration in dealing with the freight or giving exact data, they could be expected to take responsibility for any subsequent loss.
• Breach of Contract: If the freight forwarder breaches their contractual obligations, such as failing to follow agreed-upon instructions, they may be liable for any resulting losses.
• Misrepresentation: If the cargo forwarder gives misleading data or distorts the provisions of the agreement, they could be expected to take responsibility for coming about misfortunes.
• Limits of Liability: The liability of freight forwarders is often subject to limitations that are outlined in contracts or governed by international conventions. For instance:
• Convention on the Contract for the International Carriage of Goods by Road (CMR): One such convention is the Convention on the Contract for the International Carriage of Goods by Road (CMR) which outlines liability limits for road transportation. Similarly, the Warsaw Convention and its updated version, the Montreal Convention, govern liability in air transportation.
• Warsaw Convention and Montreal Convention: These conventions regulate liability in air transportation. Such conventions set a monetary cap on the amount of compensation that can be claimed in cases of cargo loss. However, these limits are not always in line with the actual value of the cargo, and disputes may arise regarding their applicability.
Insurance and Risk Mitigation: Legal Remedies for Freight Forwarders in India
To mitigate potential liability, freight forwarders often obtain liability insurance. This insurance coverage helps them financially compensate for losses in case of cargo damage or loss. Shippers are also encouraged to purchase cargo insurance to safeguard their goods during transit.
Dispute Resolution:
Disputes regarding cargo loss and liability are typically resolved through negotiation, mediation, or legal proceedings. Many agreements among transporters and cargo forwarders incorporate discretion provisions, indicating that questions will be settled through intervention instead of conventional suit.
While cargo forwarders in India are delegates in the transportation cycle, they can in any case be expected to take responsibility for specific activities or disappointments that lead to the deficiency of freight. It’s urgent for both cargo forwarders and transporters to plainly figure out their authoritative commitments, limits of obligation, and to guarantee legitimate protection inclusion to relieve possible misfortunes during worldwide transportation exchanges
Authored By; Adv. Anant Sharma & Anushi Choudhary