Overcoming Contractual Challenges in International Freight Logistics

Overcoming Contractual Challenges in International Freight Logistics

Client Profile

At Claims Trans, we recently represented a small, yet resilient Bulgarian haulier company engaged in transporting goods throughout Western Europe. Their experience is emblematic of a broader trend where smaller logistics firms are often at a contractual disadvantage against larger counterparts. Our expertise in such cases was particularly relevant in 2023, handling multiple similar disputes effectively.

The Challenge

Our client entered into an exclusive agreement with a major German logistics company. However, the partnership encountered significant disruptions:

Unilateral Contract Alterations: Without our client’s consent, the German company drastically reduced the payment rates, severely affecting our client’s revenue.

Operational Hurdles: A crucial vehicle breakdown within our client’s fleet impeded their service provision.

Compounding these challenges, our client was compelled to terminate the contract. This action, however, led to punitive measures from the German firm, imposing penalties exceeding 10,000 EUR, with 6800.00 EUR attributed solely to the non-availability of the broken truck.

Our Intervention

Recognizing the injustice, Claims Trans undertook a comprehensive legal analysis. Despite our primary specialization in CMR cargo claims, our legal team is adept at offering stellar protection across various jurisdictions. In this case, we focused on the German Civil Code (BGB):

Article 275 of the BGB: We contended that the imposition of penalties for the inoperable truck was unlawful, as it was impossible for our client to fulfill these specific obligations.

Articles 313 & 314 of the BGB: The unilateral changes in payment terms warranted our client’s right to immediate contract termination, invalidating subsequent penalty claims.

Negotiation Strategy

Confronted with a large German logistics firm’s reluctance and contractual rigidity, our approach was multifaceted:

Persistent Advocacy: Twice-a-week communications to maintain pressure and visibility.

Tactical Escalation: Involving senior management and utilizing whistleblower channels to intensify scrutiny.

Unwavering Legal Stance: Repeatedly asserting our solid legal argumentation against dismissive tactics.

Settlement Adaptability: Demonstrating flexibility in negotiations to secure the best possible outcome for our client.

Impact and Lessons Learned

Our determined efforts culminated in a successful settlement, significantly reducing the penalty by over 70% and securing immediate payment release to our client, turning a potential loss into a gain of over 5000.00 EUR. Notably, even after accounting for our service fees, our client emerged with a net profit, illustrating the tangible value of expert legal intervention in such scenarios.

This case exemplifies a crucial lesson for smaller logistics companies: With specialized legal support, they can confidently challenge larger companies and protect their commercial interests. It underscores the power of informed legal strategy and relentless advocacy in leveling the playing field in international logistics.

Conclusion

This case not only fortified our client’s financial position but also set an important industry precedent. At Claims Trans, we pride ourselves on our unique blend of legal expertise in transport law and comprehensive industry understanding. Our approach goes beyond mere legal advocacy; we strive to protect and champion our clients’ commercial interests, ensuring they navigate the complexities of international logistics contracts with confidence and success regardless of the jurisdiction.

Reclaim Your Profits: The Ultimate Solution for Recovering Unpaid Freights in the Transport Industry

Reclaim Your Profits: The Ultimate Solution for Recovering Unpaid Freights in the Transport Industry

CLAIM DEPOT

T

he last economic cycle led global trade to a significant increase causing the transport industry to experience unprecedented demand, propelling businesses to new heights. However, as the market stabilizes, transport companies now face a pressing challenge – the prevalence of unpaid freights. These unpaid invoices are stifling cash flow and hindering the growth of transport businesses. Fortunately, unpaid freights are a familiar for Clams Trans and in this article, we share some key principles to follow in order to swiftly recover your dues and keep your business on the fast track to success.

The Problem Unraveled🚚

As the transport market adjusts to decreasing global trade, unpaid freights have become a persistent headache for transport companies. These unresolved invoices disrupt cash flow, impede operations, and strain relationships with suppliers and employees. These challenges proved to be unsurmountable even for the big players, visible through Yellow [1] and Surge Transportation [2] ‘s recent bankruptcy filings. With decreasing demand and freight rates dropping [3], every transport company should possess a robust strategy can turn the tables in their favor.

The Manifestation of the Problem✒️

Unpaid freights manifest in various ways, causing significant hurdles for transport companies. Late payments create cash flow bottlenecks, making it challenging to meet expenses and invest in growth. This cycle often leads transport companies to delay their own invoice payments, further exacerbating the issue. The time for a proactive and decisive approach is now.

Experience and Expertise

At Claims Trans, we have walked the path with numerous transport companies, facing and overcoming the problem of unpaid freights. Our expertise extends to handling multiple cargo claims involving freight withholding and unlawful deductions in damage claims. We understand the intricacies of your industry, and this invaluable experience empowers us to deliver results like no other.

The Path to Success🧩

Wondering what sets apart the most successful transport companies when it comes to recovering unpaid freights? Here’s the secret formula that guarantees results:

1. Thoroughly Assess Financial Status: Our cutting-edge tools delve deep into public and private databases to assess the financial standing of potential clients. Armed with this knowledge, you’ll make informed decisions, minimizing risks of non-payment.

2. Issue an Official Voluntary Payment Invitation: Our expertly crafted and polite payment invitations, complete with interest accumulation, leave no room for misunderstanding. Your clients will understand the implications of non-payment without any friction.

3. Engage Legal Experts: Should the need arise, our legal team, well-versed in debt recovery and transport industry intricacies, steps in to navigate any complexities swiftly and efficiently. Regardless of the debtor’s country of origin, our multitude of successful lawsuits in numerous European states allows us to provide legal protection internationally.

4. Consistency is Key: With Claims Trans by your side, you’ll stay consistent in your efforts until the invoice is paid in full. We’ll maintain open lines of communication and handle necessary documentation promptly, reinforcing your commitment to getting what’s rightfully yours.

5. Explore Barter Arrangements: In situations where cash flow is a concern for the client, explore the possibility of accepting cheaper loads or goods in exchange for the outstanding amount. This arrangement can be mutually beneficial and maintain a positive business relationship.

6. Installment Plans: For clients facing financial challenges, offering installment plans can ease the burden of a lump-sum payment. Structuring a reasonable and structured installment plan demonstrates goodwill and the willingness to support your clients during challenging times.

The Conclusion🚀

Unpaid freights no longer have to be a stumbling block for your transport business. With our unparalleled expertise and successful track record, Claims Trans ensures your cash flow stays robust and your business thrives. We understand the challenges you face, having dealt with multiple cargo claims involving freight withholding and unlawful deductions. Let us be your strategic partner in the pursuit of recovering unpaid freights, so you can focus on what you do best – driving your business towards unparalleled success. Take the first step now and contact Claims Trans today to put your business back on the fast track to prosperity.

Bibliography:
[1] Reuters. (2023, July 31). Teamsters says U.S. trucking firm Yellow shuts operations, to file for bankruptcy. CNBC. https://www.cnbc.com/2023/07/31/teamsters-says-us-trucking-firm-yellow-shuts-operations-to-file-for-bankruptcy.html
[2] Hawes, C. (2023, July 26). Surge Transportation blames bankruptcy filing on sales drop after e-commerce boom. FreightWaves. https://www.freightwaves.com/news/bankrupt-surge-transportation-unprepared-for-sales-drop-after-e-commerce-boom
[3] The European Road Freight Rate Benchmark Q1 2023. (2023) https://go.upply.com/en-gb/ti-upply-iru-european-road-freight-rates-benchmark-report-q1-2023