Penn Purchasing Services
University of Pennsylvania
Home About Us Supply Chain News Buying Information Procure-to-Pay Social Responsibility
Buying Information
>> Purchasing Training

Sponsored Projects
>> Policies & Guidelines

Use of Confidential Data
>> Purchasing Basics

Supplier Categories
Purchasing Forms
Buying Tips
Product Recalls
>> Commodity Matrix
>> Cost Savings Opportunities

New Lab Start-up Program
Equipment Maintenance Program
>> Purchasing Contract Suppliers

Supplier Classifications
Penn Marketplace Suppliers
UPS Express Shipping
>> BEN Buys Approved Suppliers

Deactivated Suppliers
Supplier Name Changes
Approved Caterers
EDI Suppliers
Local Community Suppliers
Diversity Suppliers
Restricted Suppliers
>> Supplier Showcase

Supplier Shows & Exhibits
>> Green Purchasing
>> Equipment Leasing

Surplus Property
>> Personal Purchase Program
Home > Buying Information > Receipt of Goods >

What are Damages and Who is Responsible

Who is responsible for damages?

If goods are shipped FOB Destination (standing Penn freight terms), the party at the origin is responsible for damages that occur in transit, title and responsibility for the goods transfer when the goods reach the destination. That means that in a sale of goods situation, the supplier is responsible for submitting the claims for any damages, making repairs, scheduling inspections and returns.

If goods are shipped FOB Origin or Shipping Point, the party at the destination is responsible for damages that occur in transit, title and responsibility for the goods transfer as soon as the goods are ready to ship from the origin dock. That means that in a sale of goods situation, the requisitioner is responsible for submitting the claims for any damages, making repairs, scheduling inspections and returns.

What are damages?

There are two types of damages, visible and concealed. Both must be jointly inspected by the receiver and the carrier and the type of loss or damage identified in the claim as "Visible or Noted Loss or Damage". This is loss or damage that is apparent at the time of delivery and noted on the delivery receipt and freight bill. Carefully check for any visible signs of damage to the carton, containers, or items and record all the damage on the freight documents. Immediately contact Purchasing Services for assistance in working with the supplier or filing a claim. In most cases, the carrier is not responsible for visible damage that is not documented on the delivery paperwork.

Note: To Return Visible or Noted Losses or Damage Goods, refer to section on Return of Goods.

Concealed Loss or Damage

This is loss or damage that is not discoverable during routine inspection for visible damage to the carton. Concealed loss or damage is usually discovered after the freight carrier has received a clear receipt on the freight bill copy and the customer later closely inspects or attempts to use the goods. The National Motor Freight classification describes the parties' legal obligations in this complex problem.

Significant points of these regulations are:

If a concealed loss or damage is discovered after the freight carrier has been given a clear delivery receipt:

  1. The requisitioner must notify the freight carrier within fifteen (15) days of discovery or at the latest, nine months after the delivery of the property.
  2. The requisitioner must keep the goods and any shipping containers and packing materials.
  3. Schedule an inspection by the freight carrier. The freight carrier will inspect the freight within five (5) working days of notification of the concealed loss or damage and will give Penn a copy of the inspection report when filing a claim.

    Note: The carrier may choose to waive the inspection based on the value of the shipment. If the carrier waives the inspection, make a note of the time, date and name of the person waiving the inspection and document this information in the claim records.

  4. The carrier will complete a report on the claim and retain a copy for your records.
  5. If the freight carrier fails to make the inspection, then Penn must inspect and record all relevant facts about the loss or damage. This information should then be included when filing a claim.
  6. The carrier will then complete the following steps when processing a claim:
    • Acknowledge the receipt of the claim in writing within 30 days and assign it a claim number.
    • Pay, refuse payment, or make a firm compromise offer within 120 days after receipt of the claim,

      or

    • If the claim cannot be concluded within the 120 day period, notify recipient then, and at each 60 day period thereafter, while the claim remains pending, of the reason that freight carrier cannot conclude the claim.
  7. Document the relevant facts about the loss or damage for Penn records.

    Note: Refer to the Return of Goods section for information on how to return the goods.

Home About Us Supply Chain News Buying Information Procure-to-Pay Social Responsibility