Negotiated Rates Act of 1993
The Negotiated Rates Act of 1993 gave shippers defenses against undercharge claims, in which bankrupt trucking companies sued to collect the difference between negotiated rates and higher filed tariff rates.
What it requires
After the Supreme Court's 1990 Maislin decision upheld the filed rate doctrine, trustees of bankrupt carriers sued thousands of shippers for undercharges. The Act, signed December 3, 1993, made it an unreasonable practice for a carrier no longer transporting property to collect more than a negotiated rate, exempted small businesses and charitable shippers, and let other shippers settle claims at 5 to 20 percent of the amount sought. Most provisions apply only to carriers that have stopped operating.
Why it matters
The Act is a reminder that written rate agreements protect shippers when carriers fail. It ended a wave of claims against shippers and pushed the industry toward signed contracts. For example, an e-commerce brand that ships with a regional LTL carrier on emailed quotes is better protected if it keeps the signed pricing agreement, because a bankruptcy estate reviewing old invoices may challenge charges not backed by documents. Yellow Corporation's 2023 bankruptcy renewed shipper attention to billing records and claims.
Events
Related laws
Sources
- Whitaker v. Power Brake Supply, 11th Cir. 1995 (discussing the NRA) media.ca11.uscourts.gov
Not legal advice.