CUSTOMER WITHHOLDING PAYMENT IN LIEU OF CLAIM (SHIPMENT WITHIN CANADA)

ManU

Member
10
Can someone please assist me with legal jargon/legislation that I can send my customer for Canada domestic work. I had a load stolen and now they are withholding payment on all prior loads until the stolen load is paid thru my insurance. The theft only just occurred so it's not like I can write a cheque immediately. The outstanding loads they owe for date back 30-60 days. Any help would be appreciated.
Thank you
 

loaders

Site Supporter
30
Maybe a letter from your insurance company telling them that everything will be taken care of would set their minds at ease. Talk to your broker and see if together, you can calm your customer down. Hitting back at them with rules and legalese might just inflame the situation. We have been through the same scenario, depending on the adjuster , it could take a couple of weeks or more to get the claim finalized.
 

MikeJr

Moderator
Staff member
30
I'd have to agree with Loaders, the problem is that when there is a claim, people sometimes are not logical and rational.

What you are looking for is in the Highway Traffic Act, Section 12.ii. - claim must be accompanied by a PAID freight bill.

Basically, you don't need to look at a claim unless the freight bill is first paid.

Keep well,
Mike
 

TransAction

Well-Known Member
20
It's also not legal in any industry to hold up unrelated bills on services that where completed. I had the same issue recently, I calmly explained this to the owner and received payment for my other shipments the following week. As per the damages bill, it was only about $400, so I'll take the win on the other bills for now.
 

Henry

Active Member
10
We have only two insurance claims. Our attorney told me to withhold payment. Insurance companies often try to get out of paying claims.
In certain cases, the freight isn't always insured.
I have found that insurance companies are very quick at settling claims, unless there is some sort of issue.

I also learned that the insurance company will pay the freight charges, if they accept responsibility for the claim in full.

If the insurance company provides a payment date, your client should not withhold any payment, unless the payment is for freight charges for that delivery. If it is, the insurance company will pay the carrier.
 

Michael Ludwig

Well-Known Member
20
MikeJr and TransAction are correct. A letter from your insurance company won't help, but a letter from your solicitor will.
 

blairboy

New Member
2
What a messy situation. Anything that has to do with insurance always seems to drag on for much longer than needed.
 

Michael Ludwig

Well-Known Member
20
That's not necessarily true. If you are well organized, and meticulous, insurance settlements are fairly quick. Usually if there's a hold up it's either because the insured has not forwarded all of the necessary information to the insurance company in a timely manner, or there is a manpower shortage in the appraiser/adjuster department.
Insurance companies don't normally withhold owed payments ... the simple reason is it is too hard on the bean counters ... they absolutely hate doing accrual accounting.
 

Gord M

Active Member
15
The key to getting a claim through quickly is to give the insurance adjuster everything they need right away, copies of the ownership's, copy of the drivers licence, the bill of lading and CCI if applicable, drivers incident report, all the little things need to be done within 48 hours and the payout is usually within 30 days. It can be six months if the adjuster doesn't have all the info, they have a protocol to follow and the customer has to pay you for the load before the Insurance company will cut a check.
 

loaders

Site Supporter
30
Not necessarily. Say for example, you suffered a freight claim for damaged goods in the amount of $6000Your freight charge to the customer this shipment was $300.00. You and your customer submit all of the info for the $6000claim to your insurer and they agree to pay. At this point you can decide to include the original freight charge or not, thereby making the total claim$6000 opposed to $6300Yes, you are "writing off" the original freight charge of $300 and only billing your customer for shipping the replacement/repaired goods, but you have also reduced the total claim amount which in the long run could affect your insurance premiums. The question then becomes " do I spend a little now, to save a lot latter?" I apologize for the poor punctuation, my computer is giving me fits this morning!!
 
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