Shipping Lawyer Shipping Lawyer 2 — Questions and Answers
Question 1: Under the Carmack Amendment, what is the standard for carrier liability for freight damage in domestic US rail and motor carriage?
- Strict liability regardless of cause
- Liability unless the carrier proves one of five recognized defenses (Correct answer)
- Liability only if shipper proves negligence
- Liability capped at declared value on the bill of lading
Correct answer: Liability unless the carrier proves one of five recognized defenses
The Carmack Amendment creates a rebuttable presumption of carrier liability, which the carrier can overcome by proving one of five common-law defenses such as act of God or inherent vice.
Question 2: Which international convention governs the rights and liabilities of parties to a contract for the carriage of goods by sea where the port of loading or discharge is in the United States?
- The Hague Rules
- The Hamburg Rules
- COGSA (Carriage of Goods by Sea Act) (Correct answer)
- The Rotterdam Rules
Correct answer: COGSA (Carriage of Goods by Sea Act)
COGSA, modeled on the Hague Rules, applies by force of law to foreign trade shipments to or from US ports and limits carrier liability to $500 per package.
Question 3: What does 'general average' require of cargo owners whose goods were undamaged during a maritime emergency?
- They may recover damages from the carrier
- They must contribute to the losses incurred for the common benefit (Correct answer)
- They forfeit their right to claim under marine insurance
- They must renegotiate freight rates with the vessel owner
Correct answer: They must contribute to the losses incurred for the common benefit
General average is a maritime law principle requiring all parties with a financial interest in a voyage to share proportionately in losses deliberately incurred to save the ship and cargo.
Question 4: A shipper discovers its goods were damaged and wishes to sue the carrier. Under COGSA, what is the time limit for bringing suit?
- 6 months from delivery
- 1 year from delivery or scheduled delivery (Correct answer)
- 2 years from the date of the bill of lading
- 3 years from discovery of damage
Correct answer: 1 year from delivery or scheduled delivery
COGSA Section 3(6) provides a one-year statute of limitations running from the date of delivery or the date the goods should have been delivered.
Question 5: Which US federal agency has primary jurisdiction over the economic regulation of common carriers by water in domestic offshore trades?
- Federal Maritime Commission (FMC) (Correct answer)
- US Coast Guard (USCG)
- Maritime Administration (MARAD)
- Surface Transportation Board (STB)
Correct answer: Federal Maritime Commission (FMC)
The FMC regulates ocean transportation intermediaries, common carriers, and terminal operators engaged in the US foreign and certain domestic offshore trades.
Question 6: What is a 'freight forwarder' as defined under US shipping law?
- A carrier that operates its own vessels
- An intermediary that arranges transportation on behalf of shippers without assuming carrier liability (Correct answer)
- A customs official who processes import documentation
- A port terminal operator who physically handles cargo
Correct answer: An intermediary that arranges transportation on behalf of shippers without assuming carrier liability
An ocean freight forwarder is an OTI licensed by the FMC that arranges cargo space and documentation but generally does not issue its own bills of lading as principal.
Question 7: Under the Jones Act (Merchant Marine Act of 1920), which requirement applies to cargo transported between two US ports?
- Cargo must be insured by a US underwriter
- Cargo must be carried on a US-built, US-flagged, US-owned, and US-crewed vessel (Correct answer)
- Cargo must clear US Customs even for domestic voyages
- Cargo manifests must be filed with the FMC 48 hours in advance
Correct answer: Cargo must be carried on a US-built, US-flagged, US-owned, and US-crewed vessel
The Jones Act cabotage requirement mandates that coastwise trade between US ports be conducted exclusively on vessels that are US-built, US-flagged, US-owned, and crewed by US citizens or permanent residents.
Shipping Lawyer Shipping Lawyer 2
Under the Carmack Amendment, what is the standard for carrier liability for freight damage in domestic US rail and motor carriage?