What To Do When You Receive Damaged Goods

Damage or loss to freight occasionally occurs to your import. In order to minimize the inconvenience and cost to you, we have outlined the following information to assist in filing a claim with the carrier and to let you know what to expect.

Canadian Law partially dictates the claims procedure, as well as what documents are required. Your efforts to follow these guidelines will greatly speed up the entire process.

If your product is short shipped you need to notify your Customs Broker of the shortage, as well as filing a claim with the carrier, so that when the replacement product crosses the border it does not get assessed with duty and/or tax a second time.

If the product is damaged, you can still claim the GST paid to Canada Border Services Agency (CBSA) back on your next input tax credit. If there is duty on the product, call your Customs Broker for assistance in reporting the damage to Customs. In the case of perishable products, there is a 3 day time limit for the filing with CBSA.

Upon receipt of all products, an inspection of the outer packaging should be made prior to signing for the goods. If there is any damage to the packaging, this should be clearly noted on the bill of lading you are signing. Be sure to take a copy of this notation. If it appears that there is substantial damage to the product, instruct the driver to call his office prior to having the goods unloaded. It may be in your best interests to refuse the shipment until it can be examined and documented properly. In all cases, taking pictures of damaged packaging and goods is a valuable practice.

Claim Filing Procedures And General Claim Information

  1. All claims or notices of intent to claim must be filed in writing. They should be mailed, faxed or e-mailed to the carrier to the attention of their claims department.
  2. Claims must be filed promptly and are subject to legal time limits from the date of delivery. A claim filed for damage or partial shortage must be filed within 60 days, while a claim for the entire loss of a shipment must be filed within 9 months.
  3. Claims must be supported by the following documents: - A written statement of loss or damage indicating pieces and values - A copy of the original bill of lading or probill where the goods were signed for short or damaged - A copy of the original supplier's invoice as proof of the value of the shipment and/or a copy of the supplier's invoice for repairs or replacement parts if applicable
  4. Salvage must be kept by the claimant until the carrier's liability has been established.
  5. Damages or shortages must be explicitly noted on the carrier's receipt copy of the bill of lading or probill at time of delivery. Failure to do so makes it very difficult to find liability with the carrier.
  6. When damage is concealed, notice must be given within 24 hours of receipt of shipment. When concealed damage is realized, stop unpacking and notify the carrier immediately to request an inspection. It is very important to discontinue unpacking as well as retaining all packaging for inspection. When an inspection report is completed, it does not substitute the written claim, nor does it indicate carrier liability.
  7. Shipments are to be checked according to the carrier's probill, not the shipper's packing slips. Carriers are not liable for goods said to be in any unopened or damaged container. If a bill of lading is signed for as "Shipper's load and count" or "X skids said to contain X cartons", this means that the shipper has agreed that the carrier did not have an opportunity to count the number of packages and is thus not liable for shortages. If you want the carrier to sign for the number of cartons, it is the shipper's responsibility to ensure this occurs; you must communicate these instructions to your shipper and make the carrier aware as well.
  8. Under law, the liability of a carrier for a shipment may be severely limited. If the shipper indicates a declared value on the bill of lading, the liability may be raised but there will also be an additional charge for the increased valuation. To protect yourself, we recommend that you purchase separate insurance.
  9. Claimed amounts are limited to the value of the goods at the time and place of shipment; losses due to idle production time or reduction of profit are not allowable to be included in the claimed amount.
  10. Carriers have no liability for goods shipped at "Owner's risk".
  11. Carriers have no liability for goods not properly packaged or crated. These types of claims should be filed with your supplier.
Freight Manager Quote
Share this post
About Author
Annette Rowan
B.Com, LL.B, CCS, CTCS

Annette Rowan is the Trade Advisory Consultant with Pacific Customs Brokers Ltd, with over 10 years in the international customs trade industry. Combined with a Bachelor of Commerce degree (International Finance) from the University of Alberta, and a Bachelor of Laws degree (International Trade) from the University of Victoria, Annette works on behalf of importers to research and interpret complicated customs laws, rules, and regulations. She also currently holds a Certified Trade Compliance Specialist designation through the Canadian Society of Customs Brokers. When Annette is not working or researching, she enjoys spending time with her husband, 2 kids, and Brutus - the dog. She also manages a small forest of jungle cacti and is a gardening enthusiast.

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.