Publications
Claims Review: Issue 9
| Title | Contents | |
|---|---|---|
| Electronic Communication - claims and a survey | Intro to theme of Claims Review | |
| 1 | Mailbox mix-up | Ship broker's claim |
| 2 | System overload | Ship agent's claim |
| 3 | Look before you lunch | Ship agent's claim |
| 4 | Corrupted counters | Ship broker's claim |
| 5 | Drawing a blank | Ship broker's claim |
CLAIMS REVIEW - ISSUE 9
Electronic Communication - claims and a survey
The trade press regularly raises the issue of how your businesses will be affected by electronic communication. To date ITIC has seen little evidence of any overall increase in claims as a result of the use of e-mail systems. New technologies will inevitably throw up new problems but in the majority of cases it is the human element that is at fault. In this respect a badly drafted e-mail in the year 2000 is no different from the misleading telegraph of 1900.
E-mail has radically reduced Members' communication costs and is becoming increasingly used in commerce generally. ITIC will monitor and inform Members of the problems that result from the use of this technology as part of the Club's regular loss prevention services. Some examples of claims that have been received are given on this page. One Member recently reported that their e-mail service provider had ceased the service for a number of hours. The Member's customers had sent messages onto the Internet via their own service companies but, unlike telex or fax systems, were not immediately aware that their messages could not be received by the Member. As a result of incidents like this some companies have limited the types of message that are sent by e-mail. What is not really known is the extent to which e-mail has become a major, if not dominant, system with which Members communicate. This is why the Club would be grateful if you could take the time to complete the survey on the reverse of this Claims Review. The individual returns will, of course, not be published or given to any outside body. As a small token of the Club's appreciation the names of those returning the survey will be entered into a draw for a bottle of champagne!
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Mailbox mix-up
A charterer invited tenders for a long term time charter. The Member, a ship broker, sent his principal's bid via an industry message system to the charterers mailbox in the United States. The bid was, of course, commercially sensitive. The Member, as is normal, used an address code for the charterer but unfortunately the American system interpreted the code as a mailing list. The principal's bid was therefore sent to a number of other owners. The principal did not secure the business and claimed his bid was under-cut as a result of its inadvertent publication.
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System overload
It is important that Members ensure that their systems can cope with the pressures upon them. A liner company introduced a system for worldwide container control. The Member was one of their agents and a single terminal was installed in their office. There was unfortunately a slump in demand for the line's Far East service and during a six month period an unusually large number of leased containers were landed at the agent's home port for redelivery. The two staff members charged with sending messages to the computerised control system were overwhelmed. Entries in relation to about a 1,000 leased containers were not made. The containers therefore remained on hire from their leasing companies and in storage at the principal's expense. The principal claimed substantial damages from the agent as a result.
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Look before you lunch
In order to meet a shipment deadline on a feeder service, cargo had to be booked by twelve noon. The agent, however, went out to lunch without checking his e-mail messages until his return at 2pm. The booking had been received in time but it was too late to make arrangements for the sailing.
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Corrupted counters
A ship broker was negotiating the details of a fixture directly with two principals. The final clause on an offer ended in two separate paragraphs, each of two lines. When the broker forwarded the message the system ignored the blank line between the paragraphs and forwarded it as a single paragraph of four lines. The recipient counter-offered on the basis that the last paragraph should be deleted. This was intended as a reference to the four lines as received. The counter-offer was accepted on the understanding that the "last paragraph" only referred to the last two lines. In another case a ship broker received a message where the sender had accepted an offer with the exception of three clauses upon which they made a counter-offer. When passing this message the system simply left out the middle of the three clauses. Although a large gap was left on the message received, the text simply provided that the party accepted the offer with the exception of two clauses. The counter-proposal was accepted on that basis.
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Drawing a blank
A ship broker in Scandinavia was instructed by his principal to confirm re-delivery of a ship to its owners. He sent the notice of re-delivery to the owner's broker in the Far East by e-mail, and requested confirmation of receipt. The owner's broker received the message, but when he viewed it, it was blank. However the system confirmed receipt to the Scandinavian broker. The owner's broker had no idea what the message concerned. The charterer's broker assumed that the re-delivery notice had been received and accepted. The owners refused to accept re-delivery of the vessel and a substantial claim was made against the Scandinavian broker.
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Permission to reproduce or distribute this document can be obtained from Charlotte Kirk, ITIC, tel: (0)20 7204 2928, email: ITIC@thomasmiller.com