Tagged: Liability in CFR deals
23 April, 2018 at 08:49 #94942
A company I know ships containers regularly and customers prepay against document copies by TT so shipper receives payment shortly after vessel sails and buyers have orignal documents before shipments arrive. This is standard in my industry. All CNF (CFR) deals. Recently five containers (a whole booking) were lost at see. For sake of simplicity just assume they fell off the ship or got abducted by alians.The expoter is not planning to return the payment siting that “In CFR deals, liability falls on the BUYER/IMPORTER as soon as the containers are loaded on to the vessel”. The buyer/importer says that in past lost cargo experiences the shippers have always refunded them the entire invoice which they had paid.
QUESTION: In a CFR/CNF/C&F deal, is the shipper liable to ensure that the containers/product are physically delivered to the buyer’s port or only responsible to get the container on the vessel? Does liability fall to the importer after the vessel sails because they are to be the insurers in CFR deals? Is the shipper legally bound to refund payment? I can’t find the “legal” answer on line.
Note: After the above shipper refused to refund payment, the buyer asked for 50% which was also refused. Is it possible that other shippers refunded the payments out of goodness, in order to keep the customer or is that the law or commonly accepted practice? I am being asked to make a judgement on this issue and need present the solid legal position.
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