Released Value vs Full Carmack Value

Full Carmack value, in one paragraph

14706(a) makes the receiving carrier, the delivering carrier, and the carrier over whose line the goods moved liable for the actual loss or injury to the property. Failure to issue a bill of lading does not affect that liability. Actual loss is the default. It is the invoice, the repair, the replacement, less salvage where salvage belongs, measured by what the claimant actually lost. It is not whatever number makes the load easy to insure, and it is not a habit of paying fifty cents a pound because a previous broker used that habit.

Start every valuation argument there. If nobody can show a valid limitation, the conversation stays on actual loss. The limitation is an exception the carrier has to fit inside the statute. The shipper does not have to prove the exception fails before the default applies. The paper either meets the test or it does not.

What a released rate has to be to stick

14706(c)(1)(A) is the general-freight permission. Subject to the notification rule in subparagraph (B), a carrier may establish rates for property other than household goods under which liability is limited to a value established by written or electronic declaration of the shipper, or by written agreement between the carrier and shipper, if that value would be reasonable under the circumstances surrounding the transportation. Read the conditions instead of a blog synonym. There is a writing. It is the shipper's declaration or an agreement between carrier and shipper. The value has to be one that would be reasonable under the circumstances.

Subparagraph (B) matters when the carrier is not required to file its tariff. On the shipper's request, the carrier provides a written or electronic copy of the rate, classification, rules, and practices the rate is based on, and that copy clearly states the dates of applicability. A limitation hiding in a rule the shipper asked for and never received is a weak story. A limitation the shipper never had a chance to choose, printed only on a document the shipper did not sign, is the fight this section creates. This page will not call the outcome. It will not call the cap void as a slogan either.

Reasonable under the circumstances is a fact. A token value on a shipment both sides knew was worth many times that token is the kind of fact the phrase invites. A value the shipper picked to pay a lower rate, with the choice in front of them, is a different fact. Bring the papers. Do not bring a percentage you heard at a dock.

A choice of rates versus a sentence nobody offered

The statute's older idea, still visible in the words declaration and agreement, is that the shipper had a way to choose. A bill that offers a released rate and a declared higher value, and that shows which one the shipper selected, is the shape of a choice. A single sentence in a tariff nobody attached, with no place to declare a higher value and no request ever answered, is the shape of a sentence nobody offered. Courts argue the edge cases. You do not need the edge case to refuse a bad habit. If you are the carrier, put the choice on the bill and keep the shipper's selection. If you are looking at someone else's bill, look for the selection before you assume the cents-per-pound line won.

Do not tell a shipper the cap is void because you dislike it. Do not tell a carrier the cap is safe because it was typed in bold. Explain the test and stop.

Declared value the shipper actually wrote

If the shipper wrote a value on the bill and the shipment moved under that declaration, use that value as the starting point of the conversation. Do not invent a declared value to help either side. A blank declared-value box is blank. A box filled in by the carrier after the shipper signed is not the shipper's declaration. A value in an email the shipper sent before pickup, if it is truly the written or electronic declaration the section describes, belongs in the file with the bill. A value the salesperson remembers is not a declaration.

If the shipper asked for the rules and the carrier never sent them, keep that request and the silence. Subparagraph (B) is about that copy. It is not about a speech.

How this differs from a broker's liability cap

A broker can try to cap the broker's own liability in the broker's contract with the shipper. That cap does not automatically become the motor carrier's Carmack limitation. The carrier's limitation runs through the bill and the agreement the statute describes. Rate-con liability caps is the page for the broker sentence. Do not merge them. A rate confirmation the carrier signed, which the shipper never saw, is a poor candidate for the "written agreement between the carrier and shipper" in 14706(c). It may still be a contract between carrier and broker about indemnity or about what the broker will pay. Those are different promises. They do not rewrite actual loss by themselves.

A numeric example labeled as math, not as a promise

This is an illustration of the arithmetic, not the outcome of a case and not a finding that the limitation is valid. Suppose the bill says the freight is released at fifty cents a pound, the shipment weighs 20,000 pounds, and the commercial invoice is $80,000. Fifty cents times 20,000 pounds is $10,000. The gap between $10,000 and $80,000 is the reason the test matters. If the limitation meets 14706(c), the conversation starts from the released figure, still subject to whatever salvage and other adjustments the claim requires. If the limitation does not meet 14706(c), the conversation stays on actual loss, and the $10,000 figure is just a sentence that did not control. This illustration does not tell you which of those two is true for any real load. It shows why people fight over the sentence.

Household goods do not use this illustration as their rule. 14706(f) limits household-goods liability to a declared value only through that subsection, and it states a full-value protection obligation unless the shipper waives it in writing. A general-freight cents-per-pound paragraph applied to a household-goods move, without saying the move is household goods and without the waiver, is the wrong paragraph. If you are moving household goods, stop and read subsection (f) before you multiply pounds.

The claims process tells you how to present the number. This page only tells you which number the statute starts from, and what has to be true before a smaller number replaces it.

Keep the shipper's copy and the carrier's copy. A valuation added to the carrier's copy after the fact is not the agreement that moved with the freight. If the two copies disagree, the disagreement is the first fact in the file, ahead of any multiplication.

Frequently Asked Questions