Core Tip: There are over 300 types of commodity markets in Zhongshan City, Guangdong Province, which have formed numerous trading and logistics circles based on markets. The Second People's Court of Zhongshan City established a research team to analyze the main issues in transportation contract disputes through empirical investigations and other methods, and to propose corresponding countermeasures and suggestions.
I. Basic Information on the Transportation Contract Dispute Case
The Second People's Court of Zhongshan City has handled 134 cases of various transportation contract disputes over the past two years, with 119 cases concluded. Among the case types, 126 cases were related to road cargo transportation contracts, 5 cases to freight forwarding contracts, and 3 cases to air cargo transportation contracts. In terms of litigants, there were 56 cases involving enterprises (non-logistics companies) as the litigant, 37 cases with express (logistics) companies as the litigant, and 41 cases with other litigants.
Section II: Characteristics of Transportation Contract Disputes
Firstly, the causes of disputes are relatively concentrated. The disputes in transportation contracts often arise from cargo damage during transit or due to unpaid freight and other issues. Secondly, the proportion of default judgments is relatively high, accounting for about 35% of the cases concluded. Thirdly, the disputes are frequently caused by the lack of standardization in the transaction process of the parties to the transportation contracts. Some logistics companies have disputes due to irregular contracts, non-standard delivery orders, carrier documents, lack of signatures, or company stamps. Fourthly, new characteristics of disputes are emerging. For instance, disputes arise when shippers believe that logistics companies have failed to fulfill their obligations of notice and explanation for standardized clauses such as limited liability. Additionally, cases of shipper's lawsuits against transportation companies for collecting or advancing payment are on the rise. There are also disputes over whether or not to reinforce goods, and cases arising from unclear agreements on whether the shipped goods are special, leading to fines for the carrier by traffic management authorities, as well as disputes over driver subsidies and handling fees. Moreover, issues related to loss burden from fires or traffic accidents during transit are also emerging.
Section 3: Difficulties in Legal Application
1. Lack of transportation contracts makes it difficult to determine the subject of the lawsuit.
In a case, the defendant shipping department denied issuing the two bills of lading submitted by the plaintiff, claiming no transaction with Mr. Zhang, the plaintiff, regarding the two shipments of lighting goods. The case lacked a signed transportation contract between the parties. Following the plaintiff's application, the court visited the defendant's business location to take statements from the accounting staff. After showing the original two bills of lading submitted by the plaintiff, the shipping department staff explicitly stated that the bills were the defendant's, and the goods listed on them had been delivered to the destination. Upon the judge's request, the accounting staff also presented a canceled bill of lading from the company, which matched the style of the two submitted by the plaintiff, and the phone numbers in the company information section were identical. The court recognized the two bills of lading as evidence from the plaintiff. Additionally, there were issues due to the use of abbreviated names like "Jinri" and "Hua晖" as company names, which were denied by the other party during the lawsuit, making it difficult to quickly ascertain and confirm the legal entity of the trading party.
2. Improper signing procedures lead to difficulty in determining the transaction entity.
Shippers' signatures at the carrier's office are irregular, with issues such as incorrect or missing signatures. In one case, the plaintiff could not prove a causal relationship between the shipper Xu Yuanmin (pseudonym) and "Xu Yeming" listed on the carrier's document (the plaintiff claims it's a typo), leading to the inability to confirm the plaintiff's eligibility as a transaction party, and consequently, the plaintiff's lawsuit was dismissed.
3. Difficulty in Determining Value of Goods Damaged
How to determine the value of goods damaged is a key争议 issue in transportation contract disputes. Although the law has clarified the principle of liability for goods damage, there is considerable controversy over how to determine the compensation amount once damage occurs. While the Contract Law stipulates the principles for determining the compensation amount for goods damage and the methods of handling different situations, there is still much debate in practice regarding how the compensation amount for goods damage should be determined. After research, the following methods generally exist for assessing the actual loss of goods.
Firstly, judgment is made based on the contract agreement. Article 312 of the Contract Law stipulates: The compensation amount for the damage or loss of goods, if there is an agreement between the parties, shall be in accordance with their agreement; if there is no agreement or the agreement is unclear, and the provisions of Article 61 of this Law still cannot determine it, it shall be calculated based on the market price at the place of delivery or the place where the goods should be delivered at the time of delivery. If there are other provisions regarding the calculation method and compensation limit in laws and administrative regulations, they shall be followed accordingly.
Secondly, the determination is made based on the rules of evidence. For instance, in assessing the actual loss of a plaintiff lighting company, the judge examined whether the quantity of goods stated in the custom-made agreement and its attachments matched the number of pieces listed on the shipment documents issued by the freight department, and whether the price aligned with other evidence provided. This helped confirm the value of the loss. In another case, the judge, based on the supply contract, bank withdrawal slips, and receipts for liquidated damages submitted by the plaintiff, concluded that the evidence provided by the plaintiff could substantiate the quantity of goods and sales price delivered to the defendant, thereby determining the value of the plaintiff's goods loss.
Thirdly, it is determined based on the industry conventions of logistics companies. It is quite common for carriers to agree on compensation for cargo damage within a range of 2 to 10 times the freight charges. For example, Article 5 of a freight bill from a certain logistics company stipulates: The consigned goods must be covered under a valuation transportation contract. If damaged or lost, the responsibility falls on our company. For those that have been insured, compensation is 80% of the insurance amount; for those not insured and damaged, compensation is 5 times the freight charges or up to a maximum of 200 yuan per piece, with no liability on our part. Similarly, the fourth item in the precautions below the consignment note issued by a certain freight department in the case states: The consignor must participate in insurance (valuation) transportation. If there is any loss or damage, the insured (insured) goods within the carrier's scope are to be compensated by the carrier, with compensation to be issued no later than 45 days. For goods not insured (valued), if lost or missing, the carrier will compensate up to 2 to 3 times the freight charges for the batch of goods. However, there is a significant dispute between the parties regarding the applicability of the above provisions in litigation cases. Generally, a specific judgment needs to be made based on the specific circumstances of the case and the evidence submitted by the parties.
Fourthly, the value judgment for damaged goods is based on the assessment of the loss. The judgment is made according to the value determined in the assessment report issued by the assessment institution. For instance, a "Price Assessment Conclusion for Vehicle and Property Loss in Traffic Accidents" issued by the Price Certification Center of a certain county's price bureau assessed the loss value of the cargo carried by a heavy-duty ordinary truck with the license plate number HUN D at 70,126 yuan. This is a common practice for courts to determine the value of goods in handling disputes over transportation contracts.
4. Handling of advance payment or collection clauses as stipulated in the transportation contract
The "Pay on Shipment" model is a common business practice in the logistics industry. This involves logistics companies collecting payments from dealers on behalf of manufacturers and then remitting the funds back to the manufacturers. It is further divided into two modes: collection and advance payment, which yield different effects. The industry's standard practice is: if payment is to be made to the shipper only after the carrier has indeed received the consignee's payment, it is termed "collection"; if payment must be made to the shipper regardless of whether the carrier has received the consignee's payment, it is termed "advance payment." Typically, the shipment document specifies the payment amount and agrees on whether it is a "collection" or "advance payment," along with a designated collection/advance payment period of 10 to 30 days, which is the reserved time for the carrier to deliver the goods, make payments, and confirm with the consignee, as well as to pursue payment. The biggest advantage of this model is the saving of capital; media reports indicate that a logistics company with an area of about 1,000 square meters can advance up to 50 to 80 million yuan annually. However, due to unclear agreements between the parties and the business community's emphasis on speed and convenience at the expense of contract clause review, legal disputes are more likely to arise. The research team believes that carriers should handle shippers' goods properly without causing any loss, but also need to consider specific cases and not take a one-size-fits-all approach. For instance, in a particular case, the act of the carrier promising to advance payment can be considered as a supplementary obligation under the transportation contract, and the carrier must exercise due diligence when the receiving party raises a quality objection. The carrier cannot deliver goods without receiving payment unless there is a clear instruction from the shipper, otherwise, it should bear the corresponding legal consequences.
Suggested Solutions for Transport Contract Disputes
Relevant departments, enterprises, and individuals should work together to further regulate the transaction environment and rules related to transportation contracts, in order to minimize and avoid disputes, mainly including:
1. Standardize Transportation Contract Text
Unified and standardized transportation contract texts are formulated by competent authorities or industry associations to regulate market behavior in the logistics sector. By establishing and promoting industry standards for logistics through trade associations, the handover process of goods can be standardized, template bills of lading developed, and certification standards for logistics companies and personnel created, thereby reducing disputes between logistics companies and consignors, and promoting the rapid and sound development of the logistics industry.
2. Enhance industry regulation
The industry is being strengthened by the Commerce Administration and other departments. The Commerce Administration is resolutely cracking down on and eliminating unlicensed operations in the logistics and transportation market, intensifying efforts to investigate various unfair competitive practices, combating illegal business activities, and striving to create a fair, just, healthy, and orderly market environment. Special inspections for honesty in logistics services are being organized to combat false advertising and illegal promotional activities in the logistics industry, and to urge operators to engage in honest business practices. Contract supervision is being strengthened, examining whether the standardized contracts of operators adhere to principles of fairness and justice and whether there are any "tyrant clauses" that infringe upon consumer rights. It is recommended that banks enhance supervision over the issuance of dishonored checks by logistics companies, curbing the misuse of checks as currency from the source, and preventing disputes arising from the collection and advance payment of goods.
3. Focus on transaction details and enhance technical proficiency
Firstly, clarify the transaction entities. It is recommended that the parties to the transportation contract sign the contract comprehensively and diligently, paying close attention to the review of the signatory's and the transaction entity's qualifications and agency authority during the signing process to ensure the authenticity of the transaction parties. Secondly, refine the contract content. The contract should include detailed provisions on the specific conditions, value, origin and destination points, names and addresses of the consignors and consignees, quality requirements for transportation, whether there are hazardous or special goods, loading and unloading methods, compensation standards, jurisdiction clauses, obligations for advance payment and collection, and penalty clauses. Minimize the use of abbreviations for units or individuals, and focus on collecting various forms of evidence, including audio and video recordings, to minimize the likelihood of disputes. Thirdly, enhance logistics informatization. Utilize the role of the logistics industry association to encourage and guide logistics companies to widely adopt barcodes (BC), radio frequency identification (RFID), electronic data interchange (EDI), global positioning system (GPS), and intelligent transportation systems (VICS) to comprehensively improve the level of logistics informatization.
4. Serve as a Model and Lead the Way
Regulatory authorities staff provide on-site services for freight logistics companies to sign and fulfill contracts, promoting the use of model contract texts. Establish a credit rating system based on local logistics company scale, corporate culture, social reputation, and other indicators, conducting an annual credit rating for all logistics companies and establishing a reward and punishment exit mechanism. Guide small and medium-sized logistics companies in mergers and restructurings, support certain large-scale logistics companies with a solid foundation in forming corporate groups, serve to expand and strengthen logistics companies, and achieve economies of scale. Increase publicity efforts.
To educate consumers on the legal aspects of transportation contracts, alert them to various risks they may encounter while using logistics services, and enhance their risk awareness. Increase mediation efforts, and in situations where certain objective facts are difficult to ascertain and there is significant dispute between the parties, judges should remind the litigants to make a reasonable assessment of the risks and costs of litigation, show mutual understanding and leniency, and reach a settlement agreement to resolve the dispute.