# Ethical Question reguarding UPS



## TSW2005 (Jul 28, 2006)

Ok you sell something throught the web. You ship it UPS and has a value of over $100.

You send the recipiant the tracking number and UPS loses the package. The recipiant ask for no special shipping instructions.

A claim is filed for the package. Package replacement cost is $1,000. 
UPS covers $100.

Whos responsible. UPS, the shipper, or the recipiant
Remember the shipper has provided a valid tracking number, UPS has acknowledged the packed was lost on their watch, and the recipiant has not requested any special shipping instructions (IE insurance).

Options:
A. The recipiant has to go after UPS.
B. The recipiant has to go after the shipper.
C. The Shipper has to refund the value of the package that UPS lost

Your thoughts...


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## charles95405 (Feb 1, 2007)

it seems to me that the shipper is at risk for only taking out $100 protection..extra ins is the key and charge the extra as part of 'shipping and handling' unless the buyer specifically requests no insurance. We...the shipper...is responsible for delivery of the goods to the designated point...


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## lindsayanng (Oct 3, 2008)

I would say however decided to value the package at $100 is at fault.. It cant POSSIBLY by ups' fault because there is now no way to show that the ACTUAL value of the package is anything mroe that $1000.. They would have charged you more on the handling fee or insurance (whatever they call it) if the shipper had placed it at the actual cost.. 

So the shipper was trying to get off cheaper by only valuing the package at $100. This is common practive, but they usually dont value it THAT much lower. USUALLY what a shipper does is value it at half in HOPES that UPS does not loose it.. They figure they chances that they will loose it is smaller than the chances that there will be a claim, So they value it lower and if it does get lost, they let UPS pay for half, and the customer pays for half.. if they dont loose it, then the shipper just saved a few on not insuring the entire value..

The shipper is taking a gamble, and it is their duty as a business owner to cover the rest..


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## wormil (Jan 7, 2008)

The seller is responsible for getting the product delivered. In your scenario the seller failed to deliver the product and also failed to adequately insure the product, so the seller is on the hook for both the original item and it's replacement. Underinsuring is not uncommon for companies that ship lots of product because they save more than the product they lose; it's called self insuring.


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## proworlded (Oct 3, 2006)

TSW2005 said:


> Ok you sell something throught the web. You ship it UPS and has a value of over $100.
> 
> You send the recipiant the tracking number and UPS loses the package. The recipiant ask for no special shipping instructions.
> 
> ...


UPS covers up to $100. The shipper must purchase additional insurance for an amount over $100, if they wish. The shipper is responsible for the delivery and is responsible for contacting UPS to make a non-delivery claim. The shipper should always get the additional insurance and can pass the cost on to the recipient if they are being charged for the shipping charges.


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## imeccentric (May 13, 2007)

As much as I detest UPS, I agree with Charles. While I have seen some companies deny responsibility once it leaves their business(I don't do business with that kind of company), I believe the shipper is responsible until it reaches the customer. In fact, I just had an order I placed from a supplier "misdirected" by UPS and the shipper sent out an immediate replacement without me even asking.


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## lindsayanng (Oct 3, 2008)

So are you the shipper or the recipient?? or are you ups?


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## joeshaul (Mar 1, 2008)

Here's my take on it:
This depends on what/who you considered at fault. 

UPS is at fault for losing the package. So the receiver has to wait for either a new item to be shipped, or to be refunded if it's a one of a kind item. In my opinion the receiver isn't really due anything from the sender, as the package was lost in transit. The receiver could track it and see it was lost in transit, and if they lost an order or something, UPS is the one responsible from getting it from Point A to Point B. 

Now, the shipper did not insure the package properly, so they're most likely going to have to eat the cost of UPS losing the package. So they're at fault for the $900 difference and having to replace/refund the item. If I was the shipper, I would be making quite a few phone calls to find out why this happened and to hopefully put pressure on whomever was responsible for the loss of the package, but I probably wouldn't be getting extra reimbursement or find the package if it's actually been a few weeks. 

Depending on where it got lost, it could also take a little bit of conversation with the driver on either the shipping end or receiving end to help find the package. Out in the middle of nowhere we have the same driver 99% of the time and our business communicates with him regularly. I don't place too much faith in calling the customer service lines due to past experiences with their uselessness.


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## grace1456 (Feb 3, 2009)

The shipper is responsible, unless buying insurance was an option on your site & customer opted not to purchase. 

Has UPS put a tracer on the package? They are usually good about finding lost packages. They have lost a handful of our shipments (which they never found) out of several thousand packages. 

Bigger ticket items it is worth adding additional insurance- it is usually only a couple of bucks.


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## proworlded (Oct 3, 2006)

Let's be realisitic...UPS and FedEx ship millions of packages a day, airlines handle thousands of bags and cargo packages a day, truckers move thousands of shipments a day, and guess what....they also lose something, sometimes. Of course, they are at fault for the loss but that is the nature of the business and we are not going to change it. We ship several thousand packages a year by UPS and maybe a handful get lost to the point of never being found. I think that's a pretty good record for UPS. Most lost packages are just misrouted and usually get delivered within a few days. In that case, UPS refunds their charges to us.
For us, the most important thing is to take care of our customer, but it is very, very infrequent when they
do not get their shipment, and on time. Kudos to UPS...and I don't wear a brown uniform!


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## TSW2005 (Jul 28, 2006)

OK, shipper doesnt use UPS, and did not even enter a delared value (so it was not entered in as $100, but thats what UPS puts in as a default?). Was asked to ship ups which was done.
The recipiant did not ask for any special insurance or specific shipping instructions, just send which was done.
So they shipper has a tracking number, the package has left their posession. 
Still think they are responsible? Or UPS?

PS im NOT UPS, LOL


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## greyhorsewoman (Jul 19, 2007)

> unless buying insurance was an option on your site & customer opted not to purchase


I don't think that gets the shipper off the hook. It is the responsibility of the seller to deliver the product to the buyer in the condition of purchase. Failure of the shipper to adequately insure is his risk. He can make insurance cost to buyer voluntary or mandatory, but it is still his call.

And, many of us do pass on insurance, especially on smaller shipments, because replacing the odd one out that gets lost is far cheaper than buying insurance every time. However, any time your package goes over $200, you should REALLY reconsider. Even underinsuring by half would have been a better decision (which is what I normally opt to do, considering that covers most of the material cost).

If it is a one of a kind, irreplaceable item, I'd think full insurance is warranted.


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## grace1456 (Feb 3, 2009)

UPS automatically insures for $100, unless you add additional insurance by declaring value of package. 

Yes, the shipper is still responsible. (sorry)


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## TSW2005 (Jul 28, 2006)

You all failed Law 101 ! lol
Spoke with an attorney friend of ours, and he said legally (and unfortunately for us ) the shipper is off the hook.
If the shipper can produce a valid tracking number and UPS has "charged" them for the shipping, then they legally become repsonsible for that package.
He also said there is case law on this in some states.


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## greyhorsewoman (Jul 19, 2007)

Did you pay for this with a credit card? I'd think I'd file a dispute ... that I never received the product. Let the shipper & UPS fight it out.


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## proworlded (Oct 3, 2006)

TSW2005 said:


> You all failed Law 101 ! lol
> Spoke with an attorney friend of ours, and he said legally (and unfortunately for us ) the shipper is off the hook.
> If the shipper can produce a valid tracking number and UPS has "charged" them for the shipping, then they legally become repsonsible for that package.
> He also said there is case law on this in some states.


He is correct if you ship FOB your location. However, try telling that to your customer...and you'll probably never hear from him again.


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## charles95405 (Feb 1, 2007)

TSW2005... I think your attorney friend should take some refresher courses...He is sort of right in that UPS is responsible for the package BUT if it is lost, UPS is only responsible for payment of the amount of insurance..in this case..no insurance so the minimum value is $100...If the shipper fails to provide UPS with an accurate value of the product...shame on them


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## wormil (Jan 7, 2008)

TSW2005 said:


> You all failed Law 101 ! lol
> Spoke with an attorney friend of ours, and he said legally (and unfortunately for us ) the shipper is off the hook.
> If the shipper can produce a valid tracking number and UPS has "charged" them for the shipping, then they legally become repsonsible for that package.
> He also said there is case law on this in some states.


Honestly I'm a little confused about who is who in this situation.

The seller is responsible for getting the product to the customer. The seller chose to subcontract this duty to a shipping company (shipper) who offered the opportunity to buy insurance for the amount of the product which was declined. The deal with UPS has nothing to do with the obligation to the customer. UPS lost the package and that is between the seller and UPS. UPS is going to look for the package but will only reimburse the seller for $100. The customer is due either a replacement product or a full refund. If your lawyer is telling you different then there is something additional you haven't told us or you should get a second opinion.


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## SkullDude (May 10, 2008)

TSW2005 said:


> You all failed Law 101 ! lol
> Spoke with an attorney friend of ours, and he said legally (and unfortunately for us ) the shipper is off the hook.
> If the shipper can produce a valid tracking number and UPS has "charged" them for the shipping, then they legally become repsonsible for that package.
> He also said there is case law on this in some states.


I would be interested to see that case law, as this is contrary to everything I have ever heard.

When a buyer purchases an item they are purchasing a product even though they are also paying for the shipping fee. The seller is the one advertising their product and the fact that they can deliver the product to their customer. Therefore the seller is responsible for ensuring delivery of the product. 

I think the law that covers this is the Statute of Frauds law. Referring to the fact that a seller cannot agree to ship an item, but then not agree to deliver it.


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## veedub3 (Mar 29, 2007)

You sold the merchandise which did not reach the customer. You need to replace the merchandise and go after UPS for the replacement cost. If you did not take the insurance and UPS policy is to value it at $100 then that is all you will get.

Been through this twice with UPS in Georgia.

Katrina


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## Girlzndollz (Oct 3, 2007)

I'm with Proworlded. FOB = freight on board, that is where it is at.

If you are responsible or not lies solely, technically, in the terms in which you sold the product. This episode will probably help you define those terms, if you haven't already clearly defined them.

Define Freight On Board


I worked in accounting for years. AR, AP, etc. Those terms are extremely important in business, bc there is risk from the shipping dock to destination. As Ed pointed out, shipments get lost.

In our case, shipments were worth thousands. Lost shipments, damaged shipments, they cost money. FOB terms protects the seller, and clearly lets both parties know where the financial responsibility lies. As the shipper, we loved FOB, when there was trouble. As the recipient, we knew what the FOB meant for us. 

Make sure your terms are clear *prior* to the sale. It will avoid any messy situations *after* the sale. If a customer accepts FOB terms prior to purchase, what should you feel guilty or unethical for? If you do replace the merch, that looks good on your part. Watch out for late shipments that show up after you've replaced the merch. That happens, too.

Be careful. Set up clear terms. Use shippers you are comfortable with. Good luck to you.


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## Girlzndollz (Oct 3, 2007)

Okay. I see the posts you are referring to. I assumed Grey might be thinking the OP is the customer. I know there is some confusion as to what position the OP is in: seller or customer.

Since I am also not sure if this something that you and the OP are involved in, again, I don't wish to be involved in a member to member situation. No worries, you may even work *with* the OP at the same company. I just don't know what the relationship is here, after you joined the discussion with new details on the situation.

I think a question has been posed on how to handle a shipping situation, and I thought that was the topic we were discussing. Speaking of topic, I do hope we stick to the topic of the thread: How to handle the ethics of a lost shipment.  

Thanks, if you wish to send a pm or forum feedback via that section, please do so. Have a good night. =)


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## Rodney (Nov 3, 2004)

Let's leave the specifics out of the posts please so as not to "name names" and get in between a transaction between two members. The specifics can be worked out off board via email/PM.

Without specifics, this thread can be very useful for the forum at large when dealing with UPS, large shipments, insurance, etc.

Any person to person communication should be done via PM (private message)


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## SkullDude (May 10, 2008)

OP, I could be wrong, but I did not see anywhere where you said the package was FOB and the the buyer contractually agreed to it. If this was not mentioned to the buyer then it is still the sellers responsibility to ensure safe delivery of the freight.


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## Girlzndollz (Oct 3, 2007)

You will need to find out if terms are not defined, what the "default terms" are. There is FOB (freight on board, you are off the hook at your dock) and then DEST (destination, you are on the hook until signed for at the destination.)


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## lindsayanng (Oct 3, 2008)

This is where having a CLEAR set of terms and conditions laid out on your website, catalog, or verbally explained...

I still straongly feel that the SENDER'S lack in properly insuring the item makes them at fault.. UNLESS the customer expressly declined the insurance, where in then you would have a statement saying "by declining this insurance, you assume all responsibility if the item is lost" 

HOWEVER if you do not give the buyer the option to decline, then the buyer is assuming that the sender is going to send the item in the same condition as advertised. Same condition INCLUDES actually making it there. So if the item never makes it, regardless of who's fault, the sender has to be responsible for covering it.. Like i said, it was their lack in insurance. Who puts anything worth $1000 in the mail with nothing but a box and a label


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## lindsayanng (Oct 3, 2008)

I know that you arent going to name names, but you really should visit the vendor's website and read their terms and conditions.. See if there is anything in there that says that they are responsible for getting the item to you.. OR if you are the sender, then you should be more concerned about keeping the customer and doing damage control... You dont want people putting out bad things about your customer service all over the internet. 

What ever happened to "The customer is always right"


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## Rodney (Nov 3, 2004)

> I know that you arent going to name names, but you really should visit the vendor's website and read their terms and conditions


This was a person to person sale, like a classified or ebay type thing.



> What ever happened to "The customer is always right"


Sounds good in theory, but in practice, it doesn't always prove to be a smart business decision.

Not saying you shouldn't have awesome customer service (everyone should), it's just that sometimes customers can be unreasonable as well. Not that that's the case here at all...just commenting on that last part of your post  I don't think this thread is about that though.


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## lindsayanng (Oct 3, 2008)

I do understand that "The customer is always right" doesnt ALWAYS apply to all customers.. but in this case, i think it does. 

The buyer held up his end of the bargain, he paid for the item in full (Which really is a bad idea in hindsight i'm sure) and the seller didnt ACTUALLY get it to the buyer.. UPS was just a carrier.. 

If you ask me, both people were neglectful.. the buyer should have protected himself against this, and the buyer SHOULD have requested to have it fully insured.. but then it WAS the the sellers responsibility to make sure it got there safe.. 

Just think, if the sell delivered it by hand, and in the process it got stolen out of his car.. The BUYER shouldn't have to still pay for it!! And you cant get the theif to pay you back.. its the buyers fault and he should give back the money to the seller..


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## wormil (Jan 7, 2008)

I'm not sure why you think it is the buyer's responsibility to buy insurance. Insurance is for the benefit of the person shipping the product. Regardless of whether the buyer insists on insurance the seller still has a responsibility to deliver the product.


Yes, I understand sometimes the person shipping the product is also the buyer. I have sold items as-is, where-is; and the buyer hired a freight company to palletize and pick up the item. But unless my understanding of the situation is wrong, this did not happen in the OP's situation.


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## lindsayanng (Oct 3, 2008)

> I'm not sure why you think it is the buyer's responsibility to buy insurance.


you werent talking to me right?? Because i agree with you. it is ALWAYS the shippers responsibilty to cover any issues until it gets into the customer's hands. Then the seller has to take up their issues with the sub contracted carrier, which would be UPS in this case.


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## rndubow (Feb 18, 2007)

We have had this situation crop up a few times in the 18 years I have been in the apparel business and have always covered the cost of the lost package and replaced the goods. The way I solved the situation about 10 years ago was guesstimating how many packages we would ship in a given year, let's assume 20,000 for ease of math. I would then budget a set amount for lost packages, let's say $2,000.00 over the course of that year. I would then add .10 on to the cost of each package shipped to become self insured. If no packages were lost, I am ahead $2,000.00. Our customers don't even realize this is being tacked on, and even if they did, they would understand and appreciate it so there would never be an issue as to responsibility.


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## lindsayanng (Oct 3, 2008)

i think that the major issue here is it is not a COMPANY or a business. It was like a classified ads type of situation.. where you arent really worried about "customer relations" because you arent going into business selling things...

No one expects these things to happen to them.. As the seller, i think they should pay the money and make sure to LEARN your lesson and insure all of your packages that are worth more than $100.

It sucks, and HOPEFULLY you can push UPS to do SOMETHING about it.. but it still resides on the sellers shoulders to properly get the package to the buyer.. And _properly_ includes insurance coverage.


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## Girlzndollz (Oct 3, 2007)

I don't necessarily agree with the automatic response that the seller is financially and physically responsible for a shipment until it is delivered. That is what terms clarify.

In other business situations, most transactions I've seen were FOB shipping point, meaning once the goods left the dock of the seller, they are the responsibility of the buyer. Of course, in the case of lost shipment, it is nice when the shipper assists in finding the lost goods.

If there is going to be a situation here, it probably is best for the folks involved to seek legal advice (free from a friend is okay, as long as that person is an expert in that particular field.) I like to pay for councel, but that hasn't always yielded me the best answers, either. 

There are very clear financial responsibilities when it comes to shipping *depending* on the terms. I think the sticky part here may be, there seem to be "no terms". 

Lesson being, use terms in all situations, and if you use FOB destination, get the insurance as the seller. If you are a buyer and it is FOB origin, get the insurance if you can't afford to lose the money on a lost shipment. No one can guarentee any shipment will reach it's destination.

Here is a link to shipping terms. It's not just opinion, there are actual accounting theories and rules in place. These things end up on a spreadsheet at some point. Companies need to deal with the losses, and keeping losses to a minimum is good biz practice. 
SHIPPING TERMS – SHIPPER/BUYER RESPONSIBILITIES

From that link:


*SHIPPING TERMS – SHIPPER/BUYER RESPONSIBILITIES*​

Most companies ship merchandise under the shipping terms of FOB FACTORY or FOB ORIGIN, which means the same thing. Likewise, FOB DESTINATION or FOB BUYER’S WAREHOUSE is indistinguishable. Specified shipping terms “assign risk” to the buyer and seller in a “Freight Contract.” Freight contracts run between the carrier and either a seller or a buyer. There are two types of Freight Contracts; a SHIPMENT CONTRACT and a DESTINATION CONTRACT. A vast majority of freight is moved by SHIPMENT CONTRACTS. All shipping documents require the use of Freight Terms, which determines if goods are being delivered under a “Shipment Contract” or a “Destination Contract.” 

DESTINATION CONTRACT – The “carrier risk of loss” passes upon tender of delivery at the destination point specified in the Destination Contract. If delivery is specified at a destination point other than the buyer’s place of business or buyer’s warehouse, then it is the duty of the seller to deliver and “hold the goods at the destination specified for a reasonable period of time.” FOB DESTINATION, FOB BUYER’S WAREHOUSE, FOB JOBSITE are examples of shipping terms of a Destination Contract. The “ship to” address is not considered a freight term, just merely where goods are to be tendered for delivery. The “ship to” is only an instruction in the Freight Contract.

FOB FACTORY OR FOB ORIGIN – These shipping terms are characteristic of a “SHIPMENT CONTRACT” and the seller bears the expense and risk of putting the goods in the possession of the carrier. Title transfers to the buyer at the point when the goods leave the shipper’s loading dock but reverts back to the seller if the buyer follows the correct procedures of notifying the seller of “breach” by “rightfully revoking acceptance.” Even if “breach” has occurred, the buyer remains responsible for filing “carrier loss claims.”

BREACH – Given that merchandise is shipped FOB ORIGIN or FOB FACTORY and the buyer has “rightfully revoked acceptance” then the “title” of the goods in the possession of the buyer reverts back to the seller until the seller “cures” the breach. If the buyer accepts “non-conforming merchandise” with notification to the seller prior to the carrier’s departure from the delivery point, then “title” remains with the buyer. Breach includes shortages and damages as noted on the Delivery Receipts or the Bill of Lading. It is the buyer’s obligation to communicate “breach” to the seller in a timely fashion. Upon the buyer’s discovery of “breach” the buyer must also “rightfully revoke acceptance,” which includes the buyer’s responsibility of timely filing a formal freight claim with the carrier and also timely notifying the seller with formal notice of non-conformity


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## lindsayanng (Oct 3, 2008)

oh.. i totally agree, but if there are NO terms set, in my opinion, it IS the seller who is responsible.. 
and the big thing is there are no terms, and it was a person to person issue..


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## sunnydayz (Jun 22, 2007)

I myself require that any package leaving my address that is worth more then $100 requires it to be insured. As a business person it protects myself and my customer and I dont end up with issues such as these. If it were me and my customer did not receive the package, I would replace the package or refund the money, as it would be the right thing to do. Legally I am not sure, but since there was no insurance purchased, I would say it would be the sellers responsibility to make it right. Its really important and well worth the purchase of insurance on anything that has a high value. Left to the customer of course they will choose the cheaper option, its like something hardwired in the brain  That is why I protect myself by making insurance mandatory over a certain amount.


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## proworlded (Oct 3, 2006)

BobbieLee. Excellent reponse and to the point that the most important thing is providing excellent customer service. Hope this ends this well worn thread.


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## Girlzndollz (Oct 3, 2007)

Excellent customer service comes in alot of forms. 

I am not looking at the shipment as being a few shirts, or a case of shirts. Some shipments reach the 10's of thousands of dollars. A company cannot afford to just go replacing, at their cost, a $20K part that was lost in transit. 

If terms are FOB origin, the customer ought to be insuring that part, and they usually do. Also, with a $20K shipment, I can tell you only a very foolish company would not clearly state the terms of shipment. It would be crazy to put oneself in such a position.

As a customer with terms of FOB origin, if the $20K part I ordered was damaged by the carrier, I don't expect a free replacement from the seller. The seller gives me excellent customer service by helping me get my claim paid thru the carrier. 

My point being, good customer service comes in all forms. But automatically jumping to replace a lost shipment isn't necessarily a healthy decision businesswise. 

Like BobbieLee, I have very clear terms, that are accepted upon purchase, so that I don't have these issues either. It is just excellent business practice to cover yourself.

In this case - it seems the cat is already out of the bag... and I do hope the seller and customer work it out, or continue to work together to keep the carrier looking for that shipment, but I still say.... have clear terms, on any and all shipments, even person to person and classifieds. 

Look at the experienced Ebay sellers, you will see very clear terms in their auctions. They know, they learned.


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## wormil (Jan 7, 2008)

Girlzndollz said:


> Look at the experienced Ebay sellers, you will see very clear terms in their auctions. They know, they learned.


 Putting disclaimers in your auction terms stating you are not responsible for lost shipments doesn't relieve you of the responsibility. As far as ebay is concerned, it is the sellers responsibility to get get the product to the customer and insure it if necessary unless you state clearly that the customer will be responsible for shipping. (or that you won't ship at all).


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## wormil (Jan 7, 2008)

lindsayanng said:


> you werent talking to me right?? Because i agree with you. it is ALWAYS the shippers responsibilty to cover any issues until it gets into the customer's hands. Then the seller has to take up their issues with the sub contracted carrier, which would be UPS in this case.


Sorry, I realize now that misread one of your replies. My brain read one word as another. Maybe it's the madcow.


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## sunnydayz (Jun 22, 2007)

Girlzndollz said:


> Excellent customer service comes in alot of forms.
> 
> I am not looking at the shipment as being a few shirts, or a case of shirts. Some shipments reach the 10's of thousands of dollars. A company cannot afford to just go replacing, at their cost, a $20K part that was lost in transit.
> 
> ...


I agree with most of this  But I still think that when you are selling a product, its up to you to give the best service and best protection available to the customer.

If I were shipping a 20K part, you can bet that part would be insured. If the customer was not willing to insure it, It is something I would do on my own just to protect myself and my customer, to make sure we have a long professional relationship. The insurance costs are really very low, considering the peace of mind that they would offer. So I guess what I was getting at, is that I would never end up in the position of having to worry about replacing a 20K dollar part, because I would make sure I was well protected before it ever even got to that point


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## Girlzndollz (Oct 3, 2007)

sunnydayz said:


> I agree with most of this  But I still think that when you are selling a product, its up to you to give the best service and best protection available to the customer.
> 
> If I were shipping a 20K part, you can bet that part would be insured. If the customer was not willing to insure it, It is something I would do on my own just to protect myself and my customer, to make sure we have a long professional relationship. The insurance costs are really very low, considering the peace of mind that they would offer. So I guess what I was getting at, is that I would never end up in the position of having to worry about replacing a 20K dollar part, because I would make sure I was well protected before it ever even got to that point


 
Exactly, and I am backing you up on that. You require insurance for orders over $100, that is excellent biz practice, and if the OP had considered these things, he wouldn't be in this situation.

I am not saying, and have not said, my opinion on what the OP "should" or "should not" do in this situation. I have refrained from that. That is entirely his decision as a seller. 

My comments have completely been about who is technically responsible for the shipment at *what point*.

I have stayed out of the customer service issues at hand... but realize, there is that whole issue involved... but I am not commenting about that. 

I think they are in a pickle, personally, and I do not envy them. That is why I hope they can work together to get the carrier to find the shipment. =)


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## Girlzndollz (Oct 3, 2007)

wormil said:


> Putting disclaimers in your auction terms stating you are not responsible for lost shipments doesn't relieve you of the responsibility. As far as ebay is concerned, it is the sellers responsibility to get get the product to the customer and insure it if necessary unless you state clearly that the customer will be responsible for shipping. (or that you won't ship at all).


And Ebay auctions, alot of times, state that the seller is not responsible for lost shipments. 

I used to do alot of buying on Ebay, as do many folks here, and that is an auction term I have to come to gripes with if I want to purchase from someone who sells with those terms in their auction.

I have included those terms in my auction, and have had a shipment lost by USPS. The customer did not come to me for a free, replacement. The item was the last of stock. I couldn't even ship a new one if I wanted to... but my delivery confirmation showed the item left PA, and was at a post office somewhere in TX, near her city, and that was the last known scan.

I aided the customer as much as possible, working with the USPS to find the shipment, but it never showed up. She never asked for a refund, she knew I shipped it, those were the terms. She did not insure it. I had costs to cover, and she was a good customer, she abided by the terms. I offered to refund any profit, and just cover my costs, she didn't take me up on it. We both stuck by the terms of the auction. No ill feelings, no lost customer, what can I say? 

This is only one case, but USPS doesn't really lose much stuff... so it doesn't really come up much. That also makes people feel comfortable foregoing insurance, but when you get sizable shipments... insure! =)

I have had things go bad on my side as a buyer on Ebay, and I've abided by the terms I bid at, as well. So for Ebay... those terms do mean something to alot of people. 

There are those customers that will chargeback any and everything, but as a buyer and seller on Ebay... shipping terms do count, and alot of seasoned sellers make their terms extremely clear.


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## wormil (Jan 7, 2008)

Girlzndollz said:


> And Ebay auctions, alot of times, state that the seller is not responsible for lost shipments.


Legally these terms hold no water. You are thinking about it in the wrong way... the seller isn't paying you to ship the item, they are paying to have the item delivered. Once you accept that responsibility, terms like you mention above are irrelevant, you are still responsible for having the item delivered or failing that, providing a full refund. Your ebay sale is a contract between you and the buyer. Your contract to have it delivered is between you and shipper. 

The truth is, just because you insert terms into a contract and both parties agree to them, doesn't make the terms legally enforceable. On top of that, if the customer uses Paypal or a credit card, those companies are going to hold you accountable for safe delivery. And some states do as well.


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## Girlzndollz (Oct 3, 2007)

Not sure about all that, Rick. I've worked for mfg companies, procurement companies, on the shipping docks, shipping and receiving pallets, and spent years in accounting, receiving payments for shipments and paying the bills for shipments. 

As the customer, if a shipment was lost or damaged and the terms were FOB origin, it was our problem. We placed the claim, also paid our invoice to the seller, and placed the re-order. 

As sellers, when a shipment went bad leaving our place... Fob origin... we wiped our brow that it was going to fall financially on the shipping company. We'd do our best to get replacement product out asap on a new PO, but that original order/po/packing slip/bol/invoice was complete for the first shipment. We also did everything we could to help facilitate the claim for the customer. After all, the shipper/carrier didn't want to lose our account in most cases... they wanted us and our customer happy. 

A lost shipment always prompted the first question on everyone lips:
"Was it FOB Origin or Dest?" Everyone wanted to know how it would play out, and who was making the claim, us or them? (Who was waiting on the money, in other words)... then there was always the second immediate problem of filling the order that was now not filled. And dealing with the invoice that would now not match up to a received PO, and not be generated for payment. Tick, tick, tick, down the list. 

But not in all that time were the terms on the shipping documents disregarded, whether they were origin or dest. 

I suppose anything, contract or terms, can be disregarded at anytime... which happens regularly, tis true. Just like anyone can sue you for anything, a customer can make a beef. Legally? I don't know, it may come down to the usual, "the deepest pocket wins". 

I never saw it in my experience tho, which is maybe why I have faith in that fact that businesses do function that way when it comes to shipping, bad shipments, and claims.

Each industry could also function differently, which might be why your experience and mine are different.

The sales per year of the size/type of companies I liked to work for, ranged in the $35M - $60M in merchandise, so I saw alot of product go in transit, and worked directly with those deliveries in one way or another, and I am just speaking from my experience in shipping, dealing with the trucking companies, and from the accounting of the transactions. 

I do realize if I buy something on Ebay, and the terms are "the seller is not responsible for the item once it is shipped, therefore they suggest insurance" that if I accept the auction terms by bidding and then if I don't take insurance, and the item gets lost.. I do realize how easy it is to open a Paypal claim --> despite the terms. I do realize that it has also been done to me. Ya do the best ya can to protect yourself, and that is all you can do.

Again, my main comments here went to the question of who is responsible in this case of this lost, non-insured shipment, and still.. I think there is no answer here, as the OP has not chimed back in to say if there were any terms discussed prior to shipping.

I suppose in a case where there are no terms, there may possibly be a legal default as to who is responsible: seller or customer. 

It seems like this shipment was valued at nearly $1k. I am sure that is money neither party wants to lose. So far, I havent' heard any news on the terms of shipping - but if they are FOB origin, I am sorry, but the seller is not responsible for the delivery of that item. The responsibilty lies between the customer and the carrier at that point, whether anyone *wants* to tell the customer that or not... 

Whether that is good customer service or not is another story, but plenty of businesses operate successfully everyday with those terms. 

Look, I think if you look at BobbieLee's policies, the anwer lies in there, no matter if you are shipping fob origin or destination... for large dollar shipments, insurance is worth the bill. 

For one or two tshirts in an order, not so much. Like you said, Rick, it'll cost you more to insure those individual shipments than to replace the few wayward ones. 

I'm not sure what the debate is here. Terms are terms and that is what terms are designed to do, place the ownership/title of good squarely on one party or another at a very specific time during transit, because accidents do happen.

Fob origin in not mean or bad business, it's just another way of doing business.


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## TSW2005 (Jul 28, 2006)

Ok, alot of good info here, and hopefully a few have learned.
To keep on point, it was a private clasified type sale. Not a business that has "shipping terms".
Also if the recipiant requested a certain type shipping, "UPS and the cheapest way", does the resposibility now fall on them because the shipper (who is the person selling the item, not UPS) did as requested?

Thanks for all the info.


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## wormil (Jan 7, 2008)

Girlzndollz said:


> I'm not sure what the debate is here. Terms are terms and that is what terms are designed to do, place the ownership/title of good squarely on one party or another at a very specific time during transit, because accidents do happen.
> 
> Fob origin in not mean or bad business, it's just another way of doing business.


I already covered FOB in an earlier post, I'm not talking about that.

Terms are not terms, that is my point. You can insert any terms you want into a contract but that doesn't make the terms legally binding even if both parties agree. It's not a matter of disregarding the terms, it's that the terms are unenforceable. Hence if you claim you are not responsible for lost packages but assume responsibility for delivery, one cancels the other and you are responsible for delivery despite your claim that you are not responsible for lost packages. See my point? If you accept responsibility for delivery, you can't abdicate that responsibility just because the package is lost.

If you include "seller not responsible for lost items" in your ebay auction and the package is lost. The buyer is not getting over on you when they dispute the charge with paypal or their credit card because those terms were never enforceable in the first place. The fault is with the seller for including contradictory terms in their auction.

FOB & CAP are different because the buyer is taking responsibility for transportation. When I recently sold a piece of large equipment I specified_ as-is, where-is. S_o the buyer had to arrange for a company to come and remove the equipment. My obligation as the seller ended the moment the shipper picked up the piece because I assumed no responsibility for delivery.

Let me give you another example, if you drive a dump truck with a sign on it that says not responsible for broken windshields that doesn't mean you aren't responsible for broken windshields, you are because you assumed that responsibility when you pulled onto the street.

Another example would be putting a sign on your door that you are not responsible for dog bites. If your dog bites someone you are still liable despite the sign because you assumed the responsibility when you bought the house and brought the dog there.


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## wormil (Jan 7, 2008)

TSW2005 said:


> Ok, alot of good info here, and hopefully a few have learned.
> To keep on point, it was a private clasified type sale. Not a business that has "shipping terms".
> Also if the recipiant requested a certain type shipping, "UPS and the cheapest way", does the resposibility now fall on them because the shipper (who is the person selling the item, not UPS) did as requested?
> 
> Thanks for all the info.


You'll want to be clear with your terms, UPS is the shipper. If you agreed to deliver the item (have it sent to them) and hired the shipper then you are responsible for getting the package to them. Failing that you responsible for refunding their money. It would have been perfectly acceptable to charge them for shipping, insurance and handling. There is no legal loophole here that will relieve you of the obligation.


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## Girlzndollz (Oct 3, 2007)

Hey Rick,

Forget about Ebay, nothing with Ebay and business is a good example, that's why it is precarious to sell or buy there. 

Otherwise, TSW is right, this is a person to person sale, and that also negates alot of the general rules of shipping. 

My point still goes to shipping in a bonafide business situation, terms are in fact terms. In business, with carrier issues, I've not seen two business' squabble over who is responsible for making the claim, the terms dictate that. Heck, terms are something customer's work like heck to negotiate with salesmen, none of them want terms FOB origin regardless of who contacts the carrier for transport. 

I think my posts still address something a little different than what others are addressing, including you, Rick. Classic business shipping was the same no matter where I worked. Someone takes the ownership at a certain point, and financial and claims responsibility fall squarely on one or the other's shoulders at a very specific point, dictated by terms.

Can someone sue if they are unhappy about what happened to them, despite what they agreed to? Absolutely, of course, and no one is immune from that, in personal or business life... but that doesn't mean terms don't matter. If they didn't, no one would have any terms... ever.


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## sunnydayz (Jun 22, 2007)

I think the way I look at it is that whether its personal or business, I am protecting myself. Like when Gunslinger bought some ink from me, I took it upon myself to insure it, because I did not want to worry about issues, should they arise of him not recieving my package. For me its a protection thing 

The thing with people is they rarely care about terms once something goes wrong. This is when most times it will become very personal. I myself insure, because I don't want to risk something of value not getting to where its going. It may just be me, but I want to make sure I have done everything in my power, to make sure my customer is protected and recieves either the product, or the value of that product should something happen.

If I were to purchase something of value and did not recieve it, you can bet I would want to be made whole. It would not matter to me what happened between the seller and the shipper. I paid for a product and I would want to recieve it, irregardless of any issues between them.


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## wormil (Jan 7, 2008)

I'm not going to lured in over my head talking about contracts, obviously contracts can have terms but if you have contradictory terms then you cannot enforce them. Ownership is almost always going to transfer at the point of origin _or _the point of delivery, this is what the terms will spell out. You can't have it both ways. You can't agree to own it until point of delivery unless you lose it. Think about how ridiculous that sounds. Plus you can't negate state laws, or the agreements with credit card companies.



Girlzndollz said:


> Otherwise, TSW is right, this is a person to person sale, and that also negates alot of the general rules of shipping.


Based on the information given, in this case the seller agreed to deliver the item and the item was lost. Unless the seller can prove the item was delivered, the buyer did not take possession is not responsible for the lost article.


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## proworlded (Oct 3, 2006)

This thread sounds like you guys are in court arguing about this case. Maybe we can get it on TV.


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## Girlzndollz (Oct 3, 2007)

wormil said:


> Ownership is almost always going to transfer at the point of origin _or _the point of delivery, this is what the terms will spell out. You can't have it both ways.


Exactly, that is all I have been saying. For folks to write clear terms.
_I just tend to use alot of words when I have to back that statement up._


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## Rodney (Nov 3, 2004)

proworlded said:


> This thread sounds like you guys are in court arguing about this case. Maybe we can get it on TV.


Actually, I want to point out that even though there are differing opinions posted in this thread, I think the discussion is very helpful to people who are new to shipping items (maybe even to folks who have been shipping items for a while)

Getting the shipping right is an important part of running a business, and it's nice that we can have a discussion here with different viewpoints without any namecalling or hard feelings.

Hopefully some people have been able to pull some good info out of the discussion. Or in others case, at least be entertained


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## Rusty44 (Apr 28, 2008)

Where I previously worked we bought and sold data center hardware. We would not ship unless it was insured. If the customer did not want insurance it had to go on their account. This left us totally protected incase of damage or loss. I have followed that practice over into my current business for shipments larger than $100 (which is automatically covered) as it would be my responsibility to deal with. 
Sandy


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## Buechee (Dec 22, 2005)

TSW2005 said:


> A. The recipiant has to go after UPS.
> B. The recipiant has to go after the shipper.
> C. The Shipper has to refund the value of the package that UPS lost
> 
> Your thoughts...


I think UPS should pay. They lost it. Plus the customer should be the one to do it. They didn't get the insurance. But I'm more than sure they all will be looking at the shipper as if it fell out his trunk on the way to ups and the track ing number really does not matter. 

Don't know if you guys remember my ups nightmare around thanksgiving. UPS, lol. I'd say more but I don't want Rodney mad at me.


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## shersher (Jul 25, 2007)

I would definitely not have a problem spending more money to have the insurance covered. Then when you don't and it gets lost, you figure it was worth it. Better to be safe than sorry.

So if they did not put more than the 100 insurance, you are out of luck, it not UPS fault


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## wormil (Jan 7, 2008)

I'll be having nightmares about shipping tonight


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## thutch15 (Sep 8, 2008)

It is on the shipper unless it was on the receivers UPS acct number.


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## SimplyTopUK (Jan 10, 2009)

I would say the person who valued it at $100.
??


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