The second step in establishing the actual value of a loss is to refer to the documents, that apply to the transportation of the cargo, and to the documents that specify the value of the cargo.
Some of the documents that may be used for this purpose include:
Bill of Lading
The Bill of Lading is the legal shipping contract and, as such, is the “go to document”. Not only will the BOL potentially contain specifics regarding limits on the valuation, it will also contain what should be an accurate description of the cargo that was actually shipped.
All International shipments, and some domestic shipments, will have an associated Commercial Invoice, which will include a statement of the value of the cargo.
While their nature and purpose will vary widely from case to case, there will somewhere be a variety of internal company documents that will describe and cost the production, assembly and preparation for shipping of the cargo.
Similarly, there will likely be purchase orders that tie either to the cost of raw materials and/or labour used in the production of the cargo, or to the cargo itself in the case of cargo that is being transported as a result of having been recently purchased.
The value of the cargo, and hence the value of a loss, is tied to the production cost of the cargo, not to the selling price of the cargo. Thus, the cargo selling price provides a reference point on cost, but it does not indicate the actual cost.
On occasion, it may be possible to support the value of damaged or lost goods using documentation of the value of components of the lost goods, provided that the finished components are themselves also offered for sale on a stand-alone basis.
Every situation is unique, and may well have unique documentation that can support the value of lost or damaged items. It
is important to explore all possible information sources during the valuation process.