Trade and Service Issues Bulletin 03/08

CONTAINER DEMURRAGE CONTRACTS -

ARE THEY VALID AND ENFORCEABLE?

Did you hear the one about ... Freight Forwarder "A" and Freight Forwarder "B"?

Freight Forwarder "A":

1. Had a shipping company Delivery Order to hand over when the local charges were paid for the cargo carried on an Express Bill;
2. Demanded that the person who collected the delivery order on behalf of Freight Forwarder "B", sign a document which was worded as though it was a contract between "A" and "B", agreeing that  "B" would pay "A", the container demurrage rates charged by "A" (which were approximately 6 times the amount of demurrage "A" paid to a shipping line), if the containers referred to on the shipping company's Delivery Order were not returned empty before the shipping company's demurrage period commenced;
3. Invoiced "B" for container demurrage approximately 6 times the shipping company's demurrage charges to "A";
4. Sued "B" when "B" and the ultimate consignees refused to pay the demurrage charges that "A" charged to "B".

We suggest:

Anyone who finds themselves in the same situation or a similar situation to "B", should seek advice before parting with the amount demanded by an "A".

In our opinion, Freight Forwarders, Customs Brokers and others who find themselves in the same situation as "B", should not merely accept the attitude and demands of someone who acts like "A" acted against "B", as we cannot see how "A" has a legal right to operate in this fashion.

Please do not hesitate to contact me with any questions?

With best regards,

John Law

Solicitor and Director; Licensed Customs Broker

The Down Under Trade Group, for Justice, Trade & Customs

"Our Industry Experience, makes the difference"

Phone:	(02) 9873 1447 (International: 61 2 9873 1447)
Fax:	(02) 9873 1264 (International: 61 2 9873 1264)
Mobile:	0414 409 098 (International: 61 414 409 098)
Web:	http://www.dutg.com.au/

Down Under Trade Consultants Pty Ltd
Down Under Legal Services Pty Ltd trading as Down Under Legal and Bennelong Legal
John V. Law & Co - Consultants for Customs House, International Trade & Government Initiatives & Solutions
mediating LATERAL Solutions - Dispute Resolution without Litigation
Brofor & Forbro Services - For Customs Brokers and Freight Forwarders

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