Drafting Transportation Contracts: Negotiating Key Terms in Shipper, Carrier, and Broker Agreements

Minimizing Liability Exposure in the Event of Loss, Damage, or Non-Delivery of Goods

Recording of a 90-minute CLE webinar with Q&A


Conducted on Thursday, May 14, 2020

Recorded event now available

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Program Materials

This CLE webinar will guide counsel in drafting transportation agreements governing the shipping of commercial goods from manufacturers to distributors to retailers. The panel will discuss best practices for negotiating contract terms on behalf of carriers, shippers, and brokers and other intermediaries such as freight forwarders and non-vessel operating common carriers, to minimize liability exposure in the event of loss, damage, delay, diversion or non-delivery of goods.

Description

Businesses involved in transporting commercial goods face significant legal risks and liability in the event of loss, damage, delay, diversion or non-delivery of the goods. Counsel advising these carriers, shippers, and intermediaries must understand a wide array of federal, state, and international transportation laws, which vary substantially by mode of transportation, and negotiate transportation contracts that comply with these myriad rules while effectively allocating risk and reducing liability exposure in ways that are accepted in the market.

Indemnification and limitation of liability provisions are key risk-shifting provisions in transportation agreements, as are insurance requirements, which can include specialized insurance provisions to cover reasonably foreseeable losses, coverage of an additional insured, and waiver of subrogation rights. Understanding the relationship between these risk-shifting mechanisms is critical to maximizing coverage and managing risk. Other essential provisions in transportation contracts include service rates, payment terms, performance obligations, damages, best efforts, force majeure, confidentiality, and more.

The expansion of the use of intermediaries adds its own set of complications, because the shipper and carrier are not negotiating with one another. Terms negotiated between the shipper and intermediary may not be passed down to the carrier, and the shipper may not be aware of terms negotiated between the intermediary and the carrier. Some intermediaries are willing to take responsibilities for the actions of the carriers they hire, while many others are not willing to do so.

Listen as our authoritative panel of transportation attorneys explains best practices for drafting transportation contracts pertaining to carriage by ocean, truck and rail. The panel will provide strategies for counsel to carriers, shippers, and intermediaries to avoid common contracting pitfalls when negotiating terms to minimize the risk of loss, damage, or non-delivery of commercial goods.

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Outline

  1. Critical provisions in transportation contracts
    1. Shipping Documents – bills of lading, waybills, receipts
    2. Limitation of Liability
      1. Statutory restraints on carrier liability limitations – COGSA, Hague-Visby and the Carmack Amendment
      2. “Himalaya” clauses extending liability limitations to subcontractors Indemnity
    3. Insurance
      1. Additional insured
      2. Waiver of subrogation
    4. Limitation or extension of carrier’s possessory lien rights
    5. Damages – limitations and exclusions
    6. Rates and payment terms
    7. Minimum volume commitments
    8. Delay provisions and Performance Indicators (KPIs)
    9. Disputes resolution, choice of law and forum
    10. Special arrangements for high-value shipments or for commodities that require special handling
    11. Force majeure
    12. Best efforts
    13. Key regulatory provisions
    14. Claims handling procedures
    15. Carrier safety standards
    16. MAP-21 and the role of the intermediary
  2. Contract negotiation considerations and best practices for carriers, shippers, and intermediaries
  3. Historical evolution and transformation of property brokers to today's complex 3PL and 4PL logistics industry

Benefits

The panel will review these and other priority issues:

  • What federal, state, and international laws and conventions govern transportation contracts?
  • What are the critical provisions that counsel should carefully negotiate when drafting transportation agreements?
  • What are some common contracting pitfalls with transportation contracts and how can they be avoided or overcome?

Faculty

Cavanaugh, J. Michael
J. Michael Cavanaugh

Partner
Holland & Knight

Mr. Cavanaugh co-chairs Holland & Knight's Energy Team. His practice includes representation of clients in...  |  Read More

Mahoney, James
James F Mahoney, PLC

Mr. Mahoney concentrates his practice in the Trucking and Transportation Industry. He is an attorney and expert...  |  Read More

Rice, Jameson
Jameson B. Rice

Partner
Holland & Knight

Mr. Rice focuses his practice primarily on matters pertaining to the transportation industry, with experience in rail,...  |  Read More

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