Presenting a live 90-minute webinar with interactive Q&A Drafting Motor Carrier Agreements: Anticipating and Addressing Cargo Claims, Carrier Indemnity Obligations and More Navigating MAP-21 Legislation, Carrier Safety Performance and Compliance Requirements, and Other Key Concerns for Motor Carriers THURSDAY, MAY 19, 2016 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Jason Orleans, Partner, Chilton Yambert Porter , Chicago William D. Bierman, Principal, Price Meese Shulman & D’Arminio , Woodcliff Lake, N.J. Jason E. Engkjer, Lommen Abdo , Minneapolis The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
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STRAFFORD WEBINAR Drafting Motor Carrier Agreements: Anticipating and Addressing Cargo Claims, Carrier Indemnity Obligations and More. May 19, 2016
KEY PROVISIONS Presented By: William D. Bierman, Esq. Price, Meese, Shulman & D’Arminio, P.C. 50 Tice Boulevard Woodcliff Lake, NJ 07677 Tel: 201-391-3737 WBierman@PriceMeese.com 6
I. INTRODUCTION Preparation – Preparation – Preparation Before you put pen to paper or keystroke to computer consider following which apply to all Contracts discussed today: 1. Contract goals for either party 2. Value of Contract in terms of dollar and customer relations 7
Preparation – Preparation – Preparation …Continued… 3. Discuss issues with company groups who will carry out Contract: operations a) financial b) claims c) d) sales: Contract is not only legal document it is an operational - financial – claims liability blueprint. 8
Preparation – Preparation – Preparation …Continued… 4. Use detailed checklist previously throughout to avoid missing important items; 5. Beware of copying another Contract as law and issues change and may not apply to your Agreement; 9
6. Use detailed checklist previously throughout to avoid missing important items; 10
Remember A fairly negotiated Contract will address both Shipper and Carrier concerns in advance providing for discussion and compromise to foster an anticipated partnership for the beneficial working relationship between the parties. 11
7. Identify unique issues underlying transaction such as: a) unique commodity b) geographic scope c) specific equipment to name a few. 12
8. Understand charges: a) freight b) accessorial c) fuel surcharge d) detention e) payment terms 13
9. Transportation Documents: a) bill of lading b) tariffs c) rules d) exclusive contract terms 14
10. General Contract Language: Always try to be “the Drafter” of the Contract: a) simple straight forward b) legalize only when necessary c) avoid ambiguities d) avoid internal inconsistencies 15
11. 800 Pound Gorilla Contracts. Throw all reason and rules out the window! 12. Many of these important and preliminary suggestions will apply to all transportation Contracts referred to throughout this discussion. 16
II. FIRST IMPORTANT KEY PROVISION: Will Contract be the entire Agreement between the parties? 49 U.S.C. §14101 (b) Will Contract Waive all rights, duties and obligations under 49 U.S.C. §14101 (b) 17
PROS v. CONS OF WAIVER PROS OF WAIVER: Parties can make any Agreement and Waive all federal legislation except: NOT WAIVE Registration Insurance Safety Fitness 18
PROS v. CONS OF WAIVER CONS OF WAIVER: Be careful what you wish for. IMPORTANT REASON NOT TO WAIVE… 19
REASONS NOT TO WAIVE NOT EXHAUSTIVE 1. No Carmack Liability § 14706 2. National Uniformity and Consistency of Statute 3. Predictability v. State Law 4. Special and Consequential Damage Interpretation 5. Removal to Federal Court 28 U.S.C. § 1337 6. Venue Flexibility 49 U.S.C. §14705(a) 20
REASONS NOT TO WAIVE NOT EXHAUSTIVE 7. Forum of Non-Conveniens – Right to transfer to convenient forum 28 U.S.C. § 1391 8. Burden of Proof for negligence transfer to shipper 9. Presumption of good order and case law 10. Consignee duty to accept shipment unless practically worthless and to mitigate damages 11. Preemption trumps state law causes of action 21
REASONS NOT TO WAIVE NOT EXHAUSTIVE 12. Written claims requirements: a) regulations on claims – 370.3 (c) b) minimum claims requirements – 370.3 (b) c) response to claims – 370.5 and 370.7 ( c ) d) claims v. offset 22
REASONS NOT TO WAIVE NOT EXHAUSTIVE 13. Bill of lading and standard provisions waived 14. Loss of released rate, notice and inadvertence clause and opportunity to declare higher rate; 15. Back side terms and conditions of bill of lading omitted 23
REASONS NOT TO WAIVE NOT EXHAUSTIVE Reasonable Dispatch Five Classic Defenses Act of God Act of Public Enemy Authority of Law Inherent Vice Act or Omission of Shipper 24
REASONS NOT TO WAIVE NOT EXHAUSTIVE 16. 9-month claim filing 17. 2-years to file suit – 49 U.S.C. 14706 (e)(1) 18. carrier liens for freight charges 19. conversion to warehouseman status upon wrongful rejection 20. salvage and on hand provision 25
REASONS NOT TO WAIVE NOT EXHAUSTIVE 21. no extraordinary value 22. hazmat protocol 23. payment of freight charges/ liability of consignor and consignee 24. shipper load and count provisions and presumption on shortage and damage claim waived 26
III. BALANCE OF CONTRACT PROVISIONS Once Determine Waiver or Not Waiver Balance of Contract still contains important terms. Obviously with Waiver Drafter must consider all terms. Outside Interstate Commerce Act to Complete Transaction. A provision becomes KEY if not covered properly. 27
SPECIAL ITEMS WAIVER OF SUBROGATION ADDITIONAL INSURED INDEMNITY VALUATION COMMERCIAL CONTRACT v. TRANSPORTATION AGREEMENT 28
TERMS TERMS TO ADDRESS TERMINATION SCOPE OF AGREEMENT RATE CHARGES AND PAYMENT FREIGHT DOCUMENTS INSURANCE REFUSED SHIPMENT AND WAREHOUSE LIABILITY 29
TERMS TERMS TO ADDRESS CARGO LIABILITY SEALED SHIPMENTS SALVAGE INDEMNIFICATION HAZMAT FORCE MAJEURE 30
GENERAL BUT IMPORTANT PROVISIONS GOVERNING LAW VENUE ARBITRATION INCORPORATION BY REFERENCE TARIFFS, CLASSIFICATIONS, RULES 31
Conclusion… A well drafted Contract can anticipate and plan for problems before they happen. On the other hand a poorly drafted Contract can create problems that may not have existed before. To copy a real estate mantra – location – location – location. In Contracts it is Preparation – Preparation – Preparation. Don’t do things because they are easy. Prepare to represent your clients by knowing, using and negotiating the key provisions of your Contract. 32
…Conclusion Preparation – Preparation – Preparation Price, Meese, Shulman & D’Arminio, P.C. By: William D. Bierman, Esq. 33
STRAFFORD CONTINUING EDUCATION MAY 19, 2016 THE BR THE BROK OKER/C ER/CAR ARRIE RIER R CO CONTRA NTRACT CT CHILTON YAMBERT PORTER LLP CHICAGO, IL Presented by: Jason Orleans jorleans@cyp-law.com
INTR INTRODUC ODUCTION: TION: BROKER – MOVING FREIGHT FOR SHIPPER – MAY HAVE SHIPPER’S INTEREST AT HEART, BUT CANNOT EXIST WITHOUT USE OF EFFECTIVE MOTOR CARRIERS CARRIER – WANTS THE FREIGHT – MAY HAVE LESS BARGAINING POWER SOUND CONTRACT HELPS AN EQUAL PLAYING FIELD 35
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