Don’t be taken for a ride. That’s what happened to me. Year after year, running a water transport company in the States, watching competitors try to skate free after destroying cargo. Watching big carriers hide behind fine print and deny legitimate claims. I’ve learned the hard way: the law is on your side if you know how to use it. Here’s what every shipowner and cargo owner needs to know about fighting back.
The Truth About COGSA Liability
Listen carefully. Shipping companies love one thing more than money—hiding behind old law. The Carriage of Goods by Sea Act, or COGSA, has been around since 1936. It limits carrier liability to $500 per package of cargo that’s lost or destroyed. That’s the law. But here’s where carriers cheat you: they count on you not knowing what they’re actually responsible for.
COGSA applies to all contracts of cargo shipped to or from U.S. ports in foreign trade. That means when your goods get damaged on a vessel in international waters, this law governs the dispute. Carriers use this law like a shield. But the shield only works if they’ve played fair—and most haven’t.
The 17 Defenses: When Carriers Try to Weasel Out
Carriers have 17 enumerated defenses under COGSA. They’ll use every single one to avoid paying you. Here are the main ones they’ll throw at you:
Acts of God (earthquakes, hurricanes, storms), errors in navigation, inherent vice (your goods were poorly packed), and shipper fault are the big ones. They’ll claim your cargo was damaged due to weather, human error aboard the ship, or because you didn’t package it right. And that’s where they lie.
The critical point: the burden of proof is on them, not you. If they deny your claim under one of these defenses, they have to prove it. That’s your leverage.
How They Deny Your Claim (And Why It’s Often Unfair)
I’ve filed cargo claims. I’ve had them rejected. Here’s the honest story—there are legitimate reasons to deny claims, but carriers use the system to cheat honest business owners.
Insufficient documentation is the biggest scam. They’ll say you didn’t provide the right paperwork. Missing photos of damage? Denied. No detailed inventory? Denied. Incomplete bill of lading? Denied. But here’s the thing: they count on you being disorganized or confused about what you need to provide. Most businesses don’t know that you need photographic evidence, damage surveys, shipping invoices, and a detailed description of the loss all together.
Improper packaging is their favorite excuse. They’ll claim your goods were damaged because you packed them poorly, not because they were negligent. But this is tricky—you need professional surveyor reports to counter this claim. Get an independent maritime surveyor involved immediately after damage occurs.
Late filing kills claims dead. Under the Hague-Visby Rules, you typically have one year from delivery to file a cargo damage claim. Miss that deadline by a single day, and your claim becomes null and void. No negotiation. No second chance. I’ve seen companies lose thousands because they filed 366 days after delivery.
Failure to mitigate damages is another nasty one. They’ll argue you didn’t do enough to minimize losses after damage occurred. If your cargo got wet and you didn’t take immediate action to dry it, they’ll use that against you.
Incorrect valuation of your shipment works in their favor. If you underestimated what your goods were worth, they’ll use that lower value against you in settlement. Declare too much, and they might refuse the shipment outright.
The $500 Per-Package Limitation: Know Your Escape Hatch
Carriers love hiding behind the $500 limitation. But there are rules they must follow, or this shield falls apart.
For a carrier to use the $500 limitation, they must give you two things:
- Adequate notice in writing that they’re adopting the $500 limit
- A fair opportunity to declare a higher value for your goods
This is critical. If they didn’t give you the chance to declare excess value on your bill of lading, you might be able to escape the $500 cap entirely. Many carriers slip this past shippers deliberately.
Here’s the power move: Always declare the full value of your cargo on the bill of lading. If your goods are worth $100,000 and weigh 10,000 pounds, don’t just accept their default $500 per package. Declare $100,000. Pay the extra fee for declared value coverage. It costs a few quid extra, but it transforms your recovery options. Without it, you’re capped at $500 per package—that’s highway robbery for high-value cargo.
When to Sue a Shipping Company
You have grounds to sue if:
The carrier breached COGSA duties. Ships must be seaworthy, properly equipped, and properly manned before carrying your cargo. If they send a rust bucket with a skeleton crew, that’s a breach.
They didn’t provide proper notice of liability limits. If they tried to limit your recovery to $500 without giving you written notice and the option to declare higher value, you have a claim.
They acted with recklessness or intent to cause harm. If a carrier intentionally or recklessly caused damage, the $500 limitation doesn’t protect them. This is rare but powerful when you’ve got evidence.
They mishandled the cargo after taking custody. Negligent stowage, improper securing, or failure to maintain the ship—these breach their duty of care.
They violated a contract clause. Beyond COGSA, breach of contract claims can award full damages.
How to Build an Unbeatable Claim
I’ve learned this the hard way. Here’s what works:
Act fast. The moment cargo is damaged, notify the carrier in writing—registered post, certified email, something with proof of delivery. This starts the formal claim process and shows you’re serious.
Get a professional surveyor. Don’t rely on photos alone. Hire an independent maritime surveyor to inspect and document the damage. Their report carries legal weight. It’s not cheap—but it’s worth it when you’re fighting a carrier with lawyers.
Gather everything. Bill of lading (marked with damages if applicable), commercial invoices, packing lists, freight receipts, photos of packaging and damage, communication records with the carrier, and your claim statement. Documentation is your strongest asset. Start this before a claim even happens—keep meticulous records.
File within the deadline. Don’t wait eleven months. File within the first month if possible. Aim for before the one-year deadline. Give yourself buffer time.
Know their 17 defenses cold. When they reject your claim citing Act of God or improper packaging, you need to be ready with evidence that contradicts them. If you claimed insufficient documentation was the issue, provide everything they ask for in your appeal.
File a formal written appeal. If they deny your claim, don’t just accept it. Prepare a detailed appeal letter explaining specifically why their denial is wrong, cite the policy terms and COGSA sections that support your position, and attach all evidence. Mail it certified. Give them 30-60 days to respond before escalating.
When to Call a Lawyer
Get legal help immediately if:
- Your cargo is worth more than $10,000
- The carrier claims one of the 17 COGSA defenses
- They’ve already denied your claim once
- The carrier is foreign-based (jurisdiction becomes complicated)
- You’re considering suing
Maritime law is specialized. A general attorney won’t understand the difference between COGSA and the Harter Act, won’t know how to challenge the seaworthiness of a vessel, and won’t know how to pierce the carrier’s corporate veil if they’re hiding assets. Get a maritime lawyer who handles commercial disputes—not personal injury cases.
The Insurance Claim Trap
Here’s what really gets my blood boiling. Your cargo insurance and carrier liability are two different things. Don’t assume one covers you if the other fails.
If your marine cargo insurance rejects your claim, follow the same playbook: understand the exact reason, review your policy carefully, gather all evidence, file a written appeal within the deadline (usually 30-60 days), and provide a detailed letter explaining why they’re wrong.
But understand this: your insurance claim and your COGSA claim against the carrier are separate. You can pursue both. In fact, many businesses file insurance claims first for immediate recovery, then pursue the carrier for the difference or to protect future claims.
The Bottom Line
Carriers count on you being confused, disorganized, and afraid of legal fights. They hope you’ll accept a lowball settlement or give up when they deny your first claim.
Don’t.
COGSA is old law, but it’s not unfair law. It protects carriers from going bankrupt over every mishap—fair enough. But it doesn’t protect them from negligence, breach of contract, or recklessness. And it doesn’t protect them if they didn’t follow the rules about notice and declared value.
Know your rights. Get your paperwork together before something goes wrong. Declare full value on your bill of lading. If they deny a claim, fight it with evidence and a formal appeal. And if the stakes are high, hire a maritime lawyer.
I’ve been there. I’ve fought carriers who were cheating me. The law works—but only if you understand it and use it properly. Don’t be taken for a ride. Hit them back where it hurts: in a courtroom, with facts, law, and evidence.
That’s how you recover your losses.