The Quest
Inside this issue:

Single transaction bonds required for suspected AD/CVD shipments

Appeals court reverses case involving ‘independent contractor’

$5.2 million verdict against a transportation broker and driver in negligent hiring case

C-TPAT and AEO to be mutually recognizable in June 2012

Goods from Argentina to lose GSP benefits

Claims Review:
International Coverage



Claims Corner: International Coverage
The following are actual claims that were covered under Avalon’s Combined Transit Liability (CTL) Program. Our CTL program automatically includes an International Coverage option to provide legal defense if a lawsuit is filed against you outside the United States and Canada, and also appoints attorneys with the expertise to defend these matters internationally.
Damaged Air Shipment
An Indirect Air Carrier (IAC) was hired to ship a piece of equipment from Los Angeles to Shanghai, China. The IAC issued their house air waybill which referenced Terms & Conditions of Service and Limitations of Liability. When the shipment was unpacked by the consignee, severe damage was noted. The consignee brought a lawsuit against the IAC in China for the damages. Avalon appointed a Chinese lawyer and the IAC was only found to be legally liable for 19 Special Drawing Rights (SDRs) per kilogram, or about $28 per kilogram because the IAC utilized appropriate limitations of liability in its house air waybill.

Claim Amount:               $41,100
Settlement:                     $6,088
Legal Fees                      $2,750
Insured’s Deductible:   $5,000  

Improper Temperature Setting
A freight forwarder shipped 550 boxes of frozen fish from New York to Portugal with bill of lading specifying a required temperature of -20°F for the container. The carrier read the shipping instructions incorrectly and set the temperature on the container to +20°F which caused the frozen fish to spoil. The consignee named the NVOCC and the ocean carrier in a lawsuit to recover for the damaged cargo and lost profits. The lawsuit was initiated in Portugal, and Avalon appointed a Portuguese attorney who was successful in getting the Portuguese court to rule that the error was the result of the carrier’s negligence. The NVOCC’s CTL policy covered all legal fees in full because the insured purchased First Dollar Defense, the policy deductible did not apply to attorney fees and only would have applied to the settlement if there was one.

Claim Amount:               $45,202
Settlement:                     $0
Legal Fees                      $7,240.12
Insured’s Deductible:   $0


For more information, please contact your local Avalon office or Andriana Davis at (847) 700-8087 or at adavis@avalonrisk.com. A list of our offices may be found at www.avalonrisk.com.

Avalon Risk Management


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