Chapter 5 Flashcards
Bailee for Hire
Is one who has temporary custody of the personal property of another for a purpose other than sale and who is compensated as a condition of such custody
Ordinary Care
The legal duty imposed upon bailees which requires them to take the same care of the goods of others as would be taken by a prudent and diligent owner of such goods
Common Carrier
Includes airlines, railroads, trucking companies and others that furnish transportation to any member of the public seeking their services
Standard (Ordinary)
This bill of lading reflects the amount for which the common carrier will be held legally liable under the tariff
Value Bill of Lading
When the Standard Bill of Lading does not accurately reflect the value of the property being transported, the owner can negotiate a new bill of lading with the carrier. The owner will pay an additional transportation rate or fee when the carrier’s liability is increased in this way.
Contract Carrier
One that carries, for pay, the goods from certain customers only as contrasted to a common carrier that carries the goods of the public in general
Private carrier
One who haul their own goods or goods entrusted to them as bailees or lesses and includes shippers who own or lease their vehicles and carry their own goods
Catastrophe Limit
The maximum amount an insurer will pay in only one disaster or occurrence
3 other reasons one might have temporary custody of the personal property of another
for repair or performance of work
for safekeeping or storage
for delivery to others
Bailees can insure their legal and contractual responsibility for damage to customers’ goods in the following ways:
Include the value of customers’ property in the amount of stock insurance provided by their commercial property insurance policy
Purchase a separate policy insuring the legal liability of the bailee for loss
Purchase a specialized bailee’s customers policy
What is Inland Transportation Insurance
Insurance, other than Marine Insurance, against loss of or damage to property while in transit or during delay incidental to transit
Provide three examples of businesses in your community which have a bailee’s exposure
Dry cleaner, storage facility, seamstress
What is the level of care required by law to be exercised by bailees of customers’ property?
The law defines the obligation owed by bailees of customers’ property to be that of ordinary care
The bailee’s exposure can often be insured as part of the coverage provided for stock under most commercial property policies. Identify two other types of bailee’s policies which might be used to insure this exposure
A legal liability policy which insures the legal liability of the bailee for loss
A specialized bailees customers policy insuring direct loss of or damage to customers’ property regardless of fault
Both the owner and the carrier can have a financial interest in property in transit. What two factors should be considered in determining who should purchase insurance coverage on a particular shipment
Establish (i) whether the owner or the carrier would be responsible for loss to the property and (ii) to what extent
What is a common carrier?
Common carriers include airlines, railroads, trucking companies and others that furnish transportation to any member of the public seeking their services
In general terms, what responsibility is owed to owners of property by common carriers?
Common carriers are liable to owners for the safe delivery of goods entrusted to them
State three exceptions to responsibility owed to owners of property by common carriers
Acts of god or natural phenomena not reasonably foreseeable
Acts of public enemies
Acts of public authority
Neglect or default of the shipper
Inherent vice in the goods transported