Salvage Value Comes Off the Cargo Claim

Mitigation is a duty, not a favor

Both sides have to act reasonably to limit the loss. The carrier does not get to ignore a resale that would have reduced the damage, and the claimant does not get to ignore value still sitting in the goods, then send the full invoice as if the goods had vanished. Mitigation is not a courtesy you offer when you feel helpful. It is part of how actual loss is measured.

That duty does not mean you race to sell. A hasty sale for almost nothing can be as bad as no sale. The duty is reasonable steps. Notice, a chance for the owner to take the freight back, and a sale only with authority are the reasonable steps. A same-day liquidation is the refused-freight mistake this page assumes you already avoided. If the freight just went on hand, go back to the notice page. Salvage is what you do after that process has had a chance to work.

Do not treat mitigation as a speech in the claim letter. Treat it as documents: the notice, the instruction, the bids, the sale or the destruction certificate.

Salvage value reduces the loss

Actual loss under 14706 is the injury to the property, not an automatic photocopy of the commercial invoice. If the claimant kept the goods and can use or sell them, that remaining value comes off. If a reasonable sale would have brought a price and nobody made the sale, the argument will be about that price too. The invoice shows what the goods were supposed to be worth when they were sound. Salvage shows what they are worth now. The difference is the loss, together with any other proven cost the claim actually supports. This page will not invent those other costs.

Use round numbers only as an illustration, not as a case. An $20,000 invoice and a $6,000 salvage credit is a $14,000 difference before any other adjustment. It is not a ruling. It shows why fighting over the full invoice, while a pallet of usable goods sits in a warehouse, is the wrong argument. Show the credit even when you are the carrier and the claimant is the one who kept the goods. Ask for the resale or the appraisal. If you are the claimant, show the credit yourself. Hiding it is how a valid claim looks inflated.

Get the sale instruction in writing

Do not sell freight you are holding for someone else because a buyer is standing at the dock. Ask the shipper, through the broker if that is the channel you have, for written authority to sell, to return, or to destroy. The writing should say who may sell, whether there is a minimum, and where the money goes. Money from a sale of their goods is not your freight revenue. It is their value, credited to the loss, unless a written agreement says something else about expenses of the sale.

Keep the authority with the bill of sale. A sale you cannot connect to an instruction looks like conversion, which is a worse fact than a damage claim. Photos before the sale show the condition you sold. Photos after, of an empty trailer, show nothing. Take the before photos.

If the instruction is "do not sell, we will pick up," you do not sell. You hold, you protect, and you update the location. Their delay, if it is unreasonable, belongs in the correspondence. It does not silently become permission.

Two bids beat one friend's number

When you are authorized to test the market, get two bids if two buyers will look. One bid from a friend, or from the first person who answers the phone, is a number the other side will not believe. You do not need a directory and this page will not give you one. Use buyers who actually deal in that kind of damaged goods, document what they were shown, and keep their written bids. If only one buyer will bid, keep the proof that you asked a second and got silence. The file should show the effort.

Do not shop the freight by posting it in a public group with the shipper's name, the receiver's rejection, and a price. That is not a bid process. It is a broadcast of someone else's damaged goods. The bids can be short. They have to be real, tied to this bill, and kept.

Expenses of a reasonable sale can be part of the conversation. Do not invent a commission. If a cost is in the bill of sale or the authority, show it. If it is not, do not add it at the end to shrink the credit.

What you may not do with rejected food or hazmat

Food, drugs, and hazardous materials do not go to a cash market because a general salvage sentence exists. Rejected meat, temperature-abused food, recalled product, and anything the shipper told you to destroy stays out of commerce. Follow the shipper's destruction instructions. Keep the destruction certificate, the date, and the location. A certificate you cannot find is a sale you cannot disprove.

Do not donate that freight to make the claim cleaner, and do not dump it in a dumpster to empty the trailer for the next load without an instruction. Donation and dumping of goods that could have been salvaged, when salvage was lawful, can raise the loss. Dumping of goods that were required to be destroyed, without the certificate, creates a different problem and still does not prove the value. The instruction decides which of those sentences applies. Your impatience does not.

Hazardous materials follow the handling rules that applied before anyone said salvage. This page is not a permission slip to retail a damaged placarded shipment. If you do not know whether a resale is lawful, do not resell. Ask the shipper in writing and wait.

How the offset shows up on the claim form

The claim should show three lines at the value section. The invoice or other proof of sound value. The salvage credit, with the bid or the bill of sale attached. The net demand. A form that demands the invoice and mentions salvage only in a footnote will be read as a demand for the invoice. Put the credit on the number.

How to handle freight claims is the rest of the file: the writing that starts the claim, the documents, the response. Do not rebuild it here. If you are the carrier answering a claim that ignored obvious salvage, the answer asks for the credit and shows why. If you are holding the goods, you do not answer by selling them the same day to manufacture a credit. You follow the authority path above, then the net number is real.

A cleaner trailer is not a cleaner claim. A credited value is.

If the claimant already sold the goods before you saw the claim, ask for that bill of sale instead of debating the invoice in the abstract. The credit is the price they obtained if the sale was reasonable, not a second imaginary bid designed to shrink the claim further. If the price looks sham, say why, with facts. Do not answer a real resale with a rumor about what the goods "could have brought."

Frequently Asked Questions