What is a Warehouser’s Liability Form?
A warehouser’s liability form is an official document outlining the responsibilities of a storage facility towards its clients. Warehouse proprietors and operators can be made accountable if the stored goods are destroyed, damaged, or stolen. This form exists alongside warehouser’s liability insurance, which shields owners and operators from the financial implications of legal defense, damage awards, and other expenses linked to a damage claim.
Key Insights
- A warehouser’s liability form stipulates the obligations of a storage facility towards its clients.
- Owners and operators of warehouses may be held responsible if stored items are destroyed, damaged, or stolen.
- Warehouser’s liability insurance protects against the financial burdens associated with legal defenses, damage awards, and related claims.
- Clearly defined responsibilities protect both warehousers and clients, emphasizing the need for clear agreements before storage.
Understanding the Warehouser’s Liability Form
The specifics of warehouser’s liability forms differ across storage facilities. Not all types of property are covered under a standard form, commonly excluding money, precious metals, and stones. When the goods’ owner retrieves their property and signs the warehouse storage receipt and release of liability, the storage operator is no longer responsible for the goods.
Warehouser’s Liability Insurance
Under the U.S. Uniform Commercial Code, warehouse operators assume liability for stored goods in exchange for a fee. These operators must adhere to a legal standard known as ‘reasonable care.’ Failure to do so results in the company’s liability for damages. Consequently, warehouse companies often invest in additional insurance to cover potential compensations for damaged goods. When property damage occurs due to a warehouser’s negligence, the insurance provider may compensate the property owner directly.
The Role of Bailment Laws
The interaction between a warehouser and the goods’ owner is termed a bailment, from the Latin bajulare, which means to bear a burden. In the U.S., bailment laws govern the relationship between a property owner and another party temporarily responsible for that property.
A bailment occurs whenever property is legitimately controlled by a non-owner. Courts in the U.S. recognize bailments even in the absence of a contract. For damage claims, the property owner must prove the bailee’s possession and control intent of the physical good. As bailees, warehousers must safeguard the property under their control, though they aren’t liable for damage from Acts of God, like earthquakes.
Given the responsibilities warehousers bear for goods in their care, it is crucial they establish clear rights and responsibilities with customers using documents like a warehouser’s liability form.
Related Terms: Compensatory Damages, Commercial Code, Property, Bailment, Act of God.
References
- The Hartford. “Warehouse Legal Liability Insurance”.
- Uniform Law Commission. “Uniform Commercial Code”.
- Cornell University, Legal Information Institute. “Bailment”.
- Cornell University. “Principles of Bailment.”
