West Coast Harbor Truckers Declare Force Majeure

Over  70 trucking companies have declared “force majeure” in letters sent to the Intermodal Association of North America (IANA) and various steamship lines  because of the severe port congestion and labor disputes on the West Coast, according to American Shipper. They claim they will not be held responsible for paying carrier-imposed charges for  late return of equipment.  Truckers have been unable to return or take possession of marine equipment due to the congestion crisis that has been impacting the Ports of Los Angeles and Long Beach for several months, and as a result have each been charged substantial  demurrage bills.
Fred Johring, president of Golden State Express, said demurrage charges can run $100 to $225 a day, and per diem charges $85 to $175 a day. The Harbor Trucking Association (HTA), which represents drayage companies near the Ports of Los Angeles and Long Beach, said the invoices from shipping lines to truckers throughout the harbor total hundreds of thousands of dollars. Smaller drayage companies could go bankrupt if these charges are not waived, said Weston LaBar, executive director of the HTA, at a press conference Friday at the offices of Port Logistics Group in Compton.

According to the Journal of Commerce, by invoking force majeure – which states that companies can not be held responsible when their service is interrupted due to circumstance beyond their control -“the drayage companies are taking a page out of the ocean carriers’ playbook because shipping lines have force majeure clauses in their UIIAs, or in their addendums to the UIIA.”  The UIIA is the legal document that contains the terms of service, and liabilities, involved in the exchange of equipment such as containers.

 The truckers who have declared force majeure want and expect the shipping lines to waive the demurrage and per diem charges caused by the current port congestion, which is a result of on-going contract talks between the ports and labor unions.  Mike Johnson, operations manager at Port Logistics Group said the truckers are not “petitioning” for relief, they are “declaring” force majeur. 

RCL Agencies will continue to monitor the situation and report further updates once available.