Legal eagle

Executive Director, Transportation Consumer Protection Council

By Staff -- Logistics Management, 4/1/1999

For a quarter century, the Transportation Consumer Protection Council (TCPC) has represented the interests of shippers and receivers in transportation matters, including freight loss and damage, undercharges, and contracts. To mark TCPC's 25th anniversary, Logistics asked Executive Director and Logistics columnist William J. Augello about his group's history, accomplishments, and future plans.

Q How did TCPC get its start?

A I was retained by a steering committee of 30 shippers in 1974 to form a shippers council to provide representation and education for shippers' interests in freight claims. Response was immediate and enthusiastic because of the crying need for more legal knowledge. In fact, we finished our first year with 200 new members and grew to 500 members the next year.

The group originally was called the Shippers National Freight Claim Council. When the undercharge crisis hit, we changed the name to the Transportation Claims and Prevention Council. When the Interstate Commerce Commission was "sunsetted," we changed to the current name (Transportation Consumer Protection Council) to fill the void caused by the loss of the ICC's protection.

Q What were the organization's primary goals?

A The council's first goal was to provide claims education that only carriers had previously provided. Unfortunately, the need to form the shippers council arose because the information carriers were giving us on their legal obligations in claims wasn't always accurate.

The second objective was to protect shippers' interests in freight claims. We launched a legislative campaign to protect and strengthen the Carmack Amendment--that's the common name for the statute in the Interstate Commerce Commission Act that made carriers liable for the full value of commodities they transported. Over the years, carriers have been attempting to water down that strict liability statute.

Q What are some of TCPC's most important accomplishments?

A I would say they would include protecting the Carmack Amendment against changes, educating the shipping public as to the proper interpretation and application of transportation laws, ... and defending against undercharges.

A concrete example of our success was the formation of joint defense groups so that shippers of all sizes being sued by bankrupt carriers could economically defend themselves against those unconscionable [undercharge] claims. We have defended over 7,000 shippers and continue to do so in some cases. ... It has been a monumental task but one that has been very successful and very gratifying.

Over the course of 25 years, we have produced between 15 and 20 educational publications on transportation problem areas, such as loss-and-damage claims, undercharge claims, contracts, cargo insurance, and our latest, a corporate procedures manual for shippers and receivers.

Q What are TCPC's priorities today?

A The biggest issue today and in the future ... is to restore the requirement for notice of tariff provisions and written consent to a carrier's limitation on liability. ... [Carmack] has a provision that allows shippers and carriers to agree to a lower liability limit in return for a lower rate. The Supreme Court has ruled that if a carrier elects to offer that choice, then the lower rate must be disclosed, that the [differential] must be fair and reasonable, and that carriers must get shippers' written consent on the bill of lading. Everything was fine up to the ICC's demise. ... The Interstate Commerce Commission Termination Act (ICCTA) required carriers to give a copy of tariffs to shippers only on request. ... [Truckers] claim that now gives them the right to limit their liability in their unfiled tariffs without shippers' written consent.

It's been suggested that we use the Internet [for checking carriers' tariff rules], but not every shipper and carrier in the United States is on the Internet. That's the part of the population that needs the [written] notice. If General Motors' managers don't know all the terms and conditions of their carriers, then shame on them. It's the occasional shipper, the mom-and-pop company, that's entitled to the same protections but is often in the dark and at the complete mercy of the carrier.

Another problem is credit rules. Carriers are still putting credit rules in their tariffs that result in a loss of discount if you don't pay within 30 days. As soon as [the carriers] stop getting the traffic or go bankrupt, their auditors go after shippers. This is still going on--it didn't stop when the undercharge situation was resolved. We have a legislative program that we hope will put an end to it.

Q And future plans?

A In the future, we hope to fine-tune transportation laws that have been changed through deregulation. Our mission is to prevent the problems that are caused by badly written legislation and to find solutions to problems that we can't prevent.

Editor's Note: The Transportation Consumer Protection Council will hold its 25th annual Claims Conference in Tucson, Ariz., May 23-26. For more information on the conference program, call (516) 549-8984.