2026 CLAIMS LIABILITY BUSINESS RULES (5 DEC 25) FINAL.pdf

Defense Personal Property Program (DP3)

Claims and Liability Business Rules (CLBR)

Managed by:

Defense Personal Property Management Office (DPMO) United States Transportation Command

508 Scott Drive Scott AFB, IL 62225

Effective Date: 15 May 2026

As of: 5 December 2025

DP3 CLBR 2026

5 Dec 2025

Left Blank Intentionally

Table of Contents

Contents

LIST OF CHANGES

Introduction

1.1. Liability

1.2. FRV Liability Requirements

1.3 Actual Value (Depreciated) Liability

1.4. Exclusions from Liability

1.5. Duty to Mitigate Loss .................................................................................. Error! Bookmark not defined.

1.6. Time Limitations on TSP Liability for Loss and Damage Claims

1.7. Liability for Goods in Storage

1.8. High Value Items and High-Risk Inventories

1.9. Transfer of Custody of Shipments

2.0 Claims

2.1 Claims Filing

2.2 Exceptions to Filing in DPS

2.3. Substantiation of Claims

2.3.1. Introduction

2.3.2. Burden of Proof

2.3.3. Notice of Loss and Damage

2.3.4. Inspection by the Transportation Service Provider

2.4. Settlement of Loss and Damage Claims

2.5 Partial Settlements

2.6. Quick Claim Settlement

2.7. Salvage

2.8. Claims for $25 or Less

2.9. Dispute Resolution

2.10. Catastrophic Loss Payments

2.11. Essential Items

2.12. Claims Processing in DPS

2.13. Filing Notice of Loss/Damage

2.14. Checking Status of Loss/Damage Claim

2.15. TSP Denied Loss/Damage Claim

2.16. Responding to a TSP Proposed Settlement

2.17. Unearned Transportation

2.18. Shared Liability on International Shipments

3.0. Claims Management

3.1. Claims Management with Multiple TSPs

3.2. Documenting Loss/Damage and Filing Claim

3.3. Shared Liability Settlement Process

3.4. Split Line-Item Settlement Process

3.5. Acceptance of Claim

4.0 Procedures for Missing or Damaged Organizational Clothing and Individual Equipment (OCIE) Appendix A Allowance List-Depreciation Guide

LIST OF CHANGES

Version Description Revision Date

Page #s

2023 • 1.2 FRV Liability o 1.2.4 Updated language to reflect FRV must utilize local replacement cost or include shipping and delivery. Also, replacement must be able to be purchased directly by customer without membership fees.

• 1.4 Exclusions from Liability o 1.4.1.6.2 Updated language to reflect Act of God exclusions will be determined on a per shipment basis by MCO only.

• 1.9 Transfer of Custody of Shipments o 1.9.2.2 Clarify responsibility of mitigation, remediation and liability for potential mold may not be transferred via joint inspection process

• 2.3 Substantiation of Claims o 2.3.1 Updated language to identify at locations where repairs cannot be made to an item the TSP will be liable for FRV.

o 2.3.2 Added clarifying language on documentation and requirements for electronics that are discovered to inoperable after transit.

o 2.3.3 Added clarifying language on when the 180-day period begins when providing Loss and Damage forms.

• 2.7 Salvage o 2.7.1 Updated language for reduction of offer in exchange for salvage rights.

01 Dec 2022 Pg 9

Pg 10

Pg 18

Pg 20

Pg 21

Pg 26

Change

• 1.2.4 and 1.3.4 o Added assembly fees to clarify that assembly is still the responsibility of the TSP.

• 1.5.2. Mold o Updated language throughout 1.5.2 and multiple sub-paragraphs. The updates include changes to notification timelines, interactions with U.S.

Government personnel, scheduling a remediation firm, and pre-existing medical condition considerations during determination of mold remediation and personal property disposal.

23 Mar 23

Pg 9

Pg 10-12

Chang e 2

• Changed use of punitive action to administrative action

13 Sep 23 Pg 21

2024 • Introduction

Added verbiage for programs these rules apply to.

• 1.5.1.1 and 1.5.1.2 Added definitions for Mitigation and Remediation.

• 1.5.2.1 Updated language to require written estimate by item and not by box within 10 GBD. If this cannot be provided in 10 GBD, then requirement for weekly updates.

• 1.5.2.5

Updated language to remove the use of mitigation in this paragraph.

• 1.5.2.6.2

Clarified language on when TSP can commence remediation and that the TSP will not receive reimbursement of remediation fees and a reduction of max liability.

• 2.3.1

Added in language that was overlooked for 2023 Business Rules regarding non-availability of repair firms in an area and requirement for TSP to provide FRV in those instances.

• 2.18.2

Added language that requires submission of proper documentation when damage is caused at the fault of the U.S. Government, while in U.S. Government’s possession.

• 3.3.7

Added language that in the event a TSP denies liability for a shared liability shipment, the TSP is required to provide documented evidence the damage occurred solely while in the custody of the U.S.

Government.

29 Dec 23 Pg 7

Pg 11

Pg 12

Pg 14

Pg 15

Pg 33

Pg 35

2026 • Introduction

Added definition of term “customer.”

Changed "If the customer files a claim with the TSP via DPS within nine months of delivery" to "...within 12 months of delivery." Change made throughout document.

Updated format for clarification.

• 1.1 Liability

Complete updated rewrite of Paragraph.

• 1.2 FRV Liability

Added “Requirements”

• 1.2.3

Added language to the end of the paragraph for “replacement Items.”

• 1.3.2

Changed language in paragraph “Liability is limited” and “with a maximum cap of”

• 1.3.3

Added replacement cost language to the end of the paragraph

• 1.4.1

Complete updated rewrite of Paragraph

• 1.4.1.6.2

Complete updated rewrite of Paragraph

• 1.5.2

Rewrite of the TSP container contamination indicators process

• 1.5.4.1

Updated listing for the payment in lieu of remediation

• 1.5.4.3

Sentence rewrite for adequate laundry

• 1.5.4.3.3

Language change to “in coordination”

• 1.5.4.4

Language change to “be delivered”

• 1.5.4.1

Updated listing for the payment in lieu of remediation

• 1.5.4.3

Sentence rewrite for adequate laundry

• 1.5.4.3.3

Language change to “in coordination”

• 1.5.4.4

Language change to “be delivered”

Introduction

The Defense Personal Property Program (DP3), Claims and Liability Business Rules (CLBR) apply to all shipments processed under:

(1) Household Goods (HHG) Tender of Service (ToS)

(2) Direct Procurement Method (DPM) ToS shipments using DPM or Local Service Order contracts

(3) Non-Temporary Storage (NTS) ToS storage actions.

This document uses the term “customer” to refer to DoW and US Coast Guard (USCG) members and civilian employees whose personal property is being moved.

The Claims Management methodology is such that the customer may directly settle a claim with a Transportation Service Provider (TSP) through DPS. If the customer files a claim with the TSP through DPS within 12 months of delivery, the TSP is responsible for Full Replacement Value (FRV) for all damaged, missing and/or destroyed items.

1.1. Liability

1.1.1. Public Law 108-136, the National Defense Authorization Act for Fiscal Year 2004, section 634 (as amended), codified at 10 U.S.C. § 2636a, requires the Secretary of War to include a clause that requires the carrier under the contract to pay the full replacement value (FRV) for loss or damage to the baggage or household effects transported under contracts for members of the Armed Forces and civilian employees of the DoW. 10 U.S.C. § 2636a(b), requires that “[i]n the case of a loss or damage of baggage or household effects transported under a contract with a carrier that includes a full replacement value clause, the amount equal to the full replacement value for the baggage or household effects shall be deducted from the amount owed by the United States to the carrier under the contract upon a failure of the carrier to settle a claim for such loss or total damage within a reasonable time.

Stated differently, 10 U.S.C. § 2636a(b) permits the U.S. Government to offset outstanding FRV-based claims against payments due to TSPs when TSPs fail to settle claims within prescribed timeframes as specified in Section 2.0. All TSPs must include the cost of FRV coverage in the rates filed in DPS. Additionally, under 10 U.S.C. 2636a(c), the limitations on amounts of claims that may be settled under § 3721(b) of the Military Personnel and Civilian Employees Claims Act (aka Personnel Claims Act (PCA), (31 U.S.C. § 3721) do not apply to a carrier's contractual obligation to pay full replacement value.

1.1.2. The delivering TSP is liable to the customer, to the customer’s agent, or to the Military service that contracted for the shipment, for loss or damage that occurs to the customer’s personal property while it is in the custody of the TSP. Subject to specific clauses related to 10 U.S.C. § 2636a and the rules below, liability on all shipments for actual loss or injury to the property will be determined in accordance with the Carmack Amendment to the Interstate Commerce Act, (49 U.S.C. § 14706) unless a specific provision herein establishes a different rule or procedure.

1.1.3. If the claim is filed directly with the TSP within 12 months of delivery, then the TSP is liable for FRV as defined in paragraph 1.2.

1.1.4. For shipments scheduled for pickup on or after 15 May 2022, the TSP’s maximum liability will be the greater of:

1.1.4.1. No less than $10,000.00 per shipment or

1.1.1.1. $6.00 times either the net weight of the HHG shipment or the gross weight of the UB shipment, in pounds, not to exceed $75,000.00. The DPMO will review maximum liability for inflation on an annual basis using the consumer price index (CPI) and make adjustment at $5,000.00 increments.

1.1.2. If the claim is filed directly with the TSP more than 12 months after delivery, then the TSP is liable for depreciated value, up to a maximum of $1.25 times the net weight of the shipment in pounds.

1.1.3. Payments by the TSP to a customer for inconvenience claims will not be deducted from the TSP’s maximum liability for loss or damage, but are a separate liability (Refer to DTR, Part IV, Appendix A-B).

1.2. FRV Liability Requirements

1.2.1. When the customer files a claim against the TSP, within 12 months of delivery, the TSP is liable for the repair or FRV cost of a damaged item, whichever is less, and for the FRV cost of lost or destroyed items, unless one or more of the exclusions listed in Section 1.3, below, applies. For these claims, the TSP’s liability is as follows: For items that are damaged but not destroyed, the TSP will, at the customer’s option, either repair the items to the extent necessary to restore them to their original working condition when received by the TSP or pay the customer for the cost of such repairs.

The TSP is obligated to replace or pay FRV for items that are damaged beyond repair and/or cannot be repaired to original working condition or usefulness.

1.2.1.1. For most items that are destroyed (i.e., the repair cost exceeds replacement cost) or lost, the customer will, at their option, either accept a replacement of the lost or destroyed item with a new item if offered by the TSP or select payment at the undepreciated fair market replacement cost of a new item.

New items should, to the greatest extent possible, be from the same manufacturer and should be the same make and model as the item that was lost or destroyed. If the TSP cannot find a new item that is the same as the item that was lost or destroyed, it may replace the item with one of comparable qualities and features. However, for lost or destroyed items that are parts of sets, such as a silver service, furniture, crystal glasses or china, the TSP may replace the lost item with a like item that matches the rest of the set. If the TSP is unable to match the item to the set, then the TSP is obligated to replace the entire set with a set of comparable qualities and features. Likewise, some items, such as collectable figures (e.g., Hummel and Lladro), collectable plates, collectable dolls, baseball cards, antiques, comic books, coin and stamp collections, and objects of art, cannot be properly replaced with new items because their value is based, in part, on the fact that they are no longer made and are no longer available for purchase as new items. For this type of item, the TSP may replace the lost or destroyed item with the same or comparable item or pay the replacement cost of the item. The list of items in this provision is not exclusive. The appropriate Military Claims Office (MCO) may designate items for consideration under this provision. The TSP shall consult with the MCO for a determination on items that may be considered under this provision.

1.2.1.2. When FRV applies to a shipment that includes one or more motor vehicles (automobiles, motorcycles, mopeds, or motor scooters), the TSP’s maximum liability for the vehicles shall be the value stated in the current issue of the N.A.D.A.’s Official Used Car Guide (the “Guide”) for such vehicle(s), adjusted for mileage and other factors considered in the Guide. However, if either the customer or the TSP obtained a pre-damage appraisal of the vehicle from a qualified appraiser, settlement will be based on the appraised value rather than the book value.

1.2.1.3. For boats, personal watercraft, ultra-light aircraft, pianos, organs, firearms, objects of art, all-terrain vehicles, and snowmobiles, the TSP may replace the item with a comparable used item or pay the fair market value replacement cost. These items have an established and widespread secondary market and are not typically considered standard household items. As such, the list of items in this provision is not exclusive. MCO’s may designate similar items for consideration under this provision. TSPs shall consult with MCO’s for a determination on items that may be considered under this provision.

1.2.1.4. The customer may reject a payment, repair, or item offered by the TSP to settle a claim. If a customer files a claim, against the TSP within 12 months of delivery, but fails to settle the claim directly with the TSPs involved in the shipment, the customer may transfer the claim to the MCO as provided in Section 2.1.2., the MCO may pay the customer pursuant to statutory and regulatory guidance and will seek to recover the FRV from the TSP. In cases where all or part of the claim has been transferred to the MCO, the TSP shall not have the option to repair or replace items in kind but must pay the MCO the repair cost or full replacement cost of a new item, whichever is less. If the TSP can show that they offered the customer a replacement item of comparable or better quality than the item lost, the TSP’s liability for that item will be limited to their replacement cost at the time offered (including tax or drayage). During the negotiation process, TSP must respond within seven calendar days of customer’s rebuttal submission date with either a counteroffer, denial, acceptance, or a reasonable timeframe that allows the TSP to obtain services from a repair firm. The TSP simply acknowledging the customer’s rebuttal within seven calendar days does not meet the requirement of a response.

1.2.2. Normally, all claims must be filed in DPS. Claims filed with a MCO under the provisions of Section 2.2, below, will be forwarded to the TSP within 12 months of delivery and within 30 days of receipt by the MCO if the claimant wants to settle the claim for FRV. If the TSP receives such a claim that has been forwarded by the MCO within 12 months of delivery, the TSP will be liable for settlement under FRV guidelines. If the TSP receives such a claim from the MCO more than 12 months after delivery, but it is postmarked or electronically transmitted within 12 months of the delivery date, then the TSP will treat the claim as if it had been filed directly with the TSP within 12 months and the TSP will be liable for settlement under FRV guidelines.

1.2.3. Replacement cost, whether depreciated or undepreciated, must be calculated based on destination replacement cost and must include shipping charges, assembly fees, and sales tax. However, TSPs are not required to pay sales tax exceeding $10 per claim without documented proof of actual payment by the customer. TSPs must use replacement cost in the local area where the customer resides or inform the customer that replacement costs include shipping and delivery charges. When TSPs do not directly purchase and ship replacement items to customers, the replacement items must be available for direct customer purchase without membership fees or special access requirements.

1.3 Actual Value (Depreciated) Liability

1.3.1. If the customer files a claim directly with the TSP or MCO more than 12 months after delivery but within two years after delivery, the TSP is liable for the depreciated value of the items only up to a maximum of $1.25 times the net weight of the shipment in pounds. Liability will be as follows:

1.3.1.1. For items that are damaged but not destroyed, the customer will, at their option, either select repair of the items to the extent necessary to restore them to their condition when received by the TSP, or select payment for the cost of such repairs, up to the depreciated value of the items.

1.3.1.2. For items that are destroyed (i.e., the repair cost exceeds the depreciated value) or lost, the TSP will pay the depreciated value for the item. However, if the customer is willing to accept a replacement item instead of cash payment, the TSP may settle all or part of a claim by delivering a replacement item(s) of like kind, quality, and condition to the customer.

1.3.2. When the customer files a claim directly with an MCO and chooses not to file with the TSP for settlement, the military will adjudicate the claim pursuant to statutory and regulatory guidance. The MCO may then assert a recovery claim against the TSP. The TSP, on this type of a recovery claim, will be liable to the MCO for the depreciated replacement cost or repair cost, whichever is less. If the customer files a claim directly with an MCO, the TSP liability is limited to the depreciated replacement cost, with a maximum cap of $1.25 times the net weight of the shipment, in pounds

1.3.3. Claims settled for the depreciated replacement cost of an item, the MCO and TSP will use the Joint Military Industry Depreciation Guide for those items that are listed in the guide. The MCO and TSP will use the current replacement cost of the item as the base to apply the depreciation factor to arrive at the current actual value of the item. If an item cannot be replaced, or no suitable replacement is obtainable, the proper measure of damages for items that depreciate shall be the original cost, adjusted upward to reflect the increase in the consumer price index (CPI) since the date of purchase, and then adjusted downward to reflect the depreciation rate in the Joint Military Industry Depreciation Guide.

Replacement cost calculations must be based on replacement cost at destination and include shipping charges, assembly fees, and sales tax. TSPs are not required to pay shipping charges or sales tax exceeding $10.00 per claim without documented proof of actual payment by the customer.

1.3.4. Replacement cost is based on the replacement cost at destination and includes shipping charges, assembly fees and sales tax. However, the TSP is not required to pay shipping charges and/or sales tax in excess of $10.00 on a claim until it receives proof that the charges and taxes were actually paid.

1.4. Exclusions from Liability

1.4.1. TSPs are liable for all property damage, loss, or destruction occurring during transportation or Non-Temporary Storage (NTS), except when loss or damage results from the following excluded causes:

1.4.1.1. From an act or omission of the customer.

1.4.1.2. From defect or inherent vice of the article.

1.4.1.3. Occurrence beyond the reasonable control of the TSP and without its fault or negligence such as, acts of God or the public enemy, acts of the U.S. Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, unusually severe weather, and delays of common carriers.

1.4.1.3.1. Normal weather conditions such as heat, rain, snow, cold and humidity are not considered Acts of God

1.4.1.3.2. MCOs determine Act of God exclusions on a per-shipment basis. The TSP shall notify the Transportation Officer (TO) and MCO in writing as soon as it is reasonably possible after the commencement any force majeure event, setting forth the full particulars in connection therewith, and shall promptly give written notice to the TO of the cessation of such occurrence as well as provide evidence of post event mitigation to prevent further damage or injury to the property..

1.4.1.4. From pre-existing infestations by mollusks, arachnids, crustaceans, parasites, or other types of pests; and for fumigation or decontamination when not the fault of the TSP; or

1.4.1.5. From loss or damage that occurs prior to release to a TSP while the goods are in the possession of another TSP under an unrelated shipment of the goods. When a shipment is released from another TSP’s control, the TSP that receives the goods for storage shall not be liable for an item claimed as missing which should have been listed as a separate item on the inventory, but which was not listed on the inventory that was prepared by the original TSP. However, the delivery TSP will be liable for items packed in cartons, if the carton is listed on the inventory, unless the delivery TSP can produce evidence to shift liability back to a prior handler and the item claimed bears a reasonable relationship to the contents of the carton listed on the inventory.

1.4.2. The TSP shall not be liable for intangible property, securities, nor for the sentimental value of an item nor shall the TSP be liable for pre-existing damage.

1.4.3. The exclusions listed above will not apply if the TSP’s own negligence significantly contributed to the loss. However, if the TSP, after giving written or electronic notice to the appropriate U.S. Government transportation office, or electronic or written notice to the customer, of a potential risk of loss or damage to the shipment from the above causes, is instructed by the U.S.

Government or the customer electronically or in writing to proceed with such transportation and/or delivery, notwithstanding such risk, the TSP shall not be liable for the loss attributed to the risk

1.5. Duty to Mitigate Loss

1.5.1. If loss or damage occurs to a shipment from one of the excluded causes listed in Exclusions from Liability, the TSP may still be liable for additional damage that results from its failure to take reasonable steps to mitigate the extent of the loss. For example, if a shipment is damaged by water, the TSP, as soon as practical, should attempt to clean and dry the items, rather than allow further damage (e.g., rust, warping, or mildew), to develop from prolonged exposure to dampness. Nothing in this section authorizes the TSP to move forward with remediation of molded items. Remediation of molded items is addressed in 1.5.2 et seq. and requires authorization from the QA before it may be commenced. In some cases, the responsible PPSO/PPPO may authorize payment for mitigation work, subject to later determination of whether the U.S. Government or the TSP will be liable for the cost.

The responsible TSP will submit a written After-Action Report within 10 working days to USTRANSCOM for all mold shipments to include the GBL number, the customer’s name, the root cause of the mold and efforts the TSP is taking to resolve. Once all mitigation efforts are complete, the TSP responsible will submit a written report of all known facts and events in chronological order. This section addresses mitigation efforts only (i.e., separation of items, wiping down and drying off of wet items). Nothing in this section authorizes moving forward with remediation of molded items

1.5.1.1. MITIGATION is carried out quickly by the one in custody of the items to prevent further damage and involves removing items from water, separating wet from dry items, using fans and drying things off. TSP arranges immediately. Costs to mitigate are costs of doing business, and the TSP bears the cost of mitigation.

1.5.1.2. REMEDIATION is professional cleaning and requires prior approval by the QA before it may be carried out. 1) When the QA and TSP agree that there is evidence of possible mold contamination, the QA will then authorize the TSP to get an itemized estimate of the cost for remediation. That estimate will state what is salvageable/unsalvageable and the cost to remediate (professionally clean). Once an estimate is received, the QA will determine whether remediation shall be carried out; 2) When the QA and TSP agree that there is no evidence of possible mold contamination, the shipment will be marked for delivery out to the customer; 3) If the QA and TSP disagree over whether there is evidence of possible mold contamination, the QA will authorize testing of the shipment. Should testing confirm the existence of mold, the QA will then authorize the TSP to get an itemized estimate of the cost for remediation. That estimate will state what is salvageable and unsalvageable and the cost to professionally remediate. Once an estimate is received, the QA will determine whether remediation shall be carried out. The MCO will also determine liability.

1.5.2. Mold, Fire, and Smoke Damage. Shipments that develop mold or which suffer fire or smoke damage in transit present special problems. All Rules regarding mold mitigation and remediation herein (1.5 through and including 1.5.2.6.2) shall apply to mold, fire, and smoke damage. The QA must be notified. The QA will determine whether to authorize remediation of mold, fire, and smoke damaged items and will determine whether remediation has been successful and who is liable.

TSPs must notify the responsible PPSO/PPPO within two U.S. Government Business Days (GBD) upon discovering container contamination indicators (water saturation, visible mold growth,), using both:

1) immediate telephone notification.

2) written notification via email with delivery and read receipt confirmation.

1.5.3. The TSP will continue shipping operations to a location as determined by the TSP and responsible PPSO/PPPO; but will not deliver to a customer’s residence prior to inspection. The responsible PPSO/PPPO will make arrangements for a QA Inspector to be present at the selected location within two business days to be present when the seals are broken, and the containers inspected for mold. If the PPSO/PPPO is unable to provide a QA inspector, contact USTRANSCOM at transcom.scott.tcj9.mbx.pp-perf@mail.mil. If there is no evidence of mold, the containers will be resealed, notations made on the inventory by the QA inspector and/or the TSP, and shipment will continue in-transit to destination. When mold is discovered, the TSP will notify the customer, the servicing QA, and the inspecting PPSO/PPPO, and update the destination PPSO/PPPO with findings within 48 hours of discovery.

1.5.4. If the TSP and the QA inspector agree that there is evidence of mold, no testing is required. The TSP shall immediately separate the molded items from the rest of the shipment and arrange for an itemized estimate for remediation, with a breakdown of salvageable and unsalvageable items

1.5.5. If the TSP and QA disagree as to the presence of mold, the PPSO/PPPO shall authorize the TSP to immediately separate the suspected items from the rest of the shipment and to obtain tape testing of the suspected items by a qualified mold testing business. If the testing shows mold types and/or levels above what would normally be expected in that area of the country, the TSP shall arrange for an itemized estimate for remediation of those affected items, with a breakdown of salvageable and unsalvageable items. The TSP in possession at the time the mold is discovered is responsible for mitigation. Mitigation costs will be assessed under Paragraph 1.5.2.5. of this section.

1.5.5.1. Payment in lieu of remediation. Prior to undertaking any remediation work, the TSP shall contact and schedule the services of a qualified mold remediation firm within three GBDs from direction of a U.S. Government official, to obtain an itemized written estimate, unless otherwise directed by the QA. The mold remediation firm shall make a preliminary assessment of the mold damage and provide a written estimate that is itemized by individual item (not by the box) within ten GBDs.

When remediation firms cannot provide estimates within ten GBD, TSPs must provide weekly written status updates to MCOs and responsible PPSOs/PPPOs including:

1) reason for delay

2) expected completion date mailto:transcom.scott.tcj9.mbx.pp-perf@mail.mil mailto:transcom.scott.tcj9.mbx.pp-perf@mail.mil

3) alternative firm options evaluated

4) recommended next steps

The TSP will provide a copy of the estimate to all parties (e.g., destination JPPSO/ PPSO/PPPO, QA, and customer). The TSP, mold remediation firm, responsible PPSO/PPPO, and customer shall determine whether circumstances warrant disposal of the contaminated items without attempting remediation. In making this decision, the QA will consider whether a customer has a documented, pre-existing medical condition which would be worsened by the presence of mold in the home. If the QA determines that remediation is appropriate, there may be circumstances where customers will still refuse delivery. For example, a customer may choose to dispose of the property rather than accept the shipment because of a family member’s “documented” medical condition. In this circumstance, in order for the refusal of shipment to be valid, the cited medical condition must have been documented prior to shipment, with appropriate evidence provided to the MCO. When the QA determines that remediation is appropriate and reasonable under the circumstances, the TSP will only be liable for the lesser of the remediation cost or full replacement cost. QA determination of disposition is final.

Note: This language is under review and updates will be provided at a later date.

1.5.5.2. Delivery of Uncontaminated Items. As soon as it is practical, after it’s determined that remediation is an option, the TSP will determine, after consulting with the mold remediation firm, whether there is an uncontaminated portion of the shipment that can be separated, without cross contamination, from the mold contaminated items and separate those items accordingly. If there are uncontaminated items, the TSP will make a new inventory of either the contaminated items or the uncontaminated items, whichever is smaller. The TSP will cross reference the new inventory with the corresponding reference from the origin inventory. The TSP will deliver any uncontaminated items in accordance with the transit agreement and provide a copy of the origin inventory and the new inventory to the customer.

1.5.5.3. Items Suitable for Cleaning or Remediation. Whether mold contaminated items are suitable for cleaning or remediation depends upon several factors including, but not limited to, the extent of the contamination on a particular item, the nature of the material contaminated, limiting future contamination, and the cost of remediation in relation to the value of the item. If items are still wet, measures should be taken to dry all items suitable for cleaning or remediation. Heavily contaminated porous items (e.g., carpets, rugs, mattresses, cloth or clothing, some wood and wood products, some ceramic items, and soft plastic) may not be suitable for cleaning or remediation.

Less heavily contaminated porous items (e.g., clothes and textiles) may be adequately laundered;

however, contamination from mold may require adding bleaching agents to remove mold stains and sanitize clothing. Adding bleaching agents might fade some fabrics and damage other fabrics and be unacceptable to the customer. Mold-contaminated items made of leather, suede, or a similar material may not be suitable for laundering or bleaching. Other professional cleaning or dry cleaning may be an option. Other non-porous household items (e.g., dishes, pots, glass items, or other metal or hard plastic items) can usually be cleaned or remediated. Advice from remediation professionals on whether to clean or discard an item may be beneficial. The TSP shall ensure the remediation company obtained by them is provided the mold remediation steps in accordance with the Claims and Lability Business Rules. The TSP will arrange for the contaminated items to be divided into items that are suitable for cleaning or other remediation and those items that are not suitable for cleaning or remediation. The TSP will provide pictures and an inventory of each category, salvageable & non- salvageable to the customer, PPSO, and MCO if requested. The customer and the QA inspector should be notified with date/time prior to the process.

1.5.5.3.1. If all contaminated items are suitable for cleaning or remediation, the TSP will notify the customer that the remainder of the shipment will be delivered when it has been cleaned or otherwise remediated. The delivery will not be considered a separate shipment.

1.5.4.3.2 If none of the contaminated items are suitable for cleaning or remediation for medical reasons, the TSP will notify the customer that none of the remainder of the shipment is suitable for cleaning or remediation. The TSP will offer the customer an opportunity to inspect the shipment and remove items of sentimental or special value in coordination with the responsible PPSO/PPPO. Before removal of any items, the TSP may require the customer to release them from personal injury liability for exposure to mold.

Sentimental items retrieved from a mold shipment will be limited to those few items of extreme sentimental value that cannot be replaced, such as photo albums, special flags and awards, jewelry, or other heirloom type items.

1.5.4.3.3 If some of the contaminated items are suitable for cleaning or remediation and some items are not suitable, then the TSP will notify the customer of that circumstance. The TSP will arrange for the cleaning or other remediation of that portion of the contaminated shipment suitable for cleaning or remediation. The TSP will arrange for delivery of the cleaned or remediated items in coordination with the customer and responsible PPSO/PPPO. The delivery will not be considered a separate shipment.

1.5.4.3.4 The TSP will offer the customer an opportunity to inspect the part of the shipment that is unsuitable for cleaning or remediation. The customer may remove items of special value from the un-remediated portion of the contaminated items, in coordination with the responsible PPSO/PPPO. Before removal of any items, the TSP may require the customer to release them from personal injury liability for exposure to mold. If a TSP is found liable for the loss and has not reached their maximum liability, 25% of the replacement value of any item that is removed from the un-remediated portion of the contaminated items will be deducted from the TSP’s liability. If the TSP’s maximum liability is exceeded and the items removed do not decrease the TSP’s maximum liability, there will be no percentage of value taken off the item. The TSP is responsible for appropriately disposing of the un-remediated portion of the contaminated items.

1.5.5.4. Delivery of remediated items. Items that have been remediated will normally be delivered to the customer as soon as practical after remediation is complete. Before delivery, TSP’s must notify the customer and destination PPSO/PPPO that the items have been remediated, are ready for delivery, and provide a reasonable opportunity to inspect the remediated items before delivery transportation begins.

The notice shall also include the location for inspection, the hours for inspection, and that the opportunity to inspect will expire after three business days or when delivery transportation begins, whichever is longer.

1.5.5.4.1. Customer inspects remediated items: If accepted all remediated items, the goods will be delivered as soon as practical. If it is not accepted the remediation on any item during the inspection, that item will be separated from the accepted items. If the TSP agrees with the customer that those items are unacceptable, the TSP shall deliver the accepted items and, if appropriate, process claims on the unacceptable items for compensation at Full Replacement Value. If the TSP disagrees with the customer on any item, the TSP will contact the destination PPSO/PPPO and advise them of the conflict. In the event of a conflict, no delivery of any remediated item, accepted or not, will be made until ordered by the destination PPSO/PPPO. The PPSO/PPPO will contact the servicing MCO. The MCO contact information can be found at: https://www.militaryonesource.mil/moving-housing/moving/moving-resources. (Locate Moving customer Support Section on web page, then https://www.militaryonesource.mil/moving-housing/moving/moving-resources https://www.militaryonesource.mil/moving-housing/moving/moving-resources expand Service Branch Moving Assistance section, then click on the appropriate service link.

Claim/MCO information is located under PCS customer Service Information section).

1.5.4.4.2 customer does not inspect remediated items: Some customer may decline to inspect or decline to respond to the notification to inspect remediated items and refuse to accept delivery of those items. If customer advise the TSP before delivery transportation begins that they will not accept the delivery, the TSP will not attempt delivery until ordered by the destination PPSO/PPPO. If customer refuse delivery of remediated items after delivery of those items begins, the TSP will transport those items to a DoW approved storage facility at the TSP’s discretion. In either case, the TSP will notify the destination PPSO/PPPO of the situation and await further direction. The destination PPSO/PPPO will contact the QA and will determine the acceptability of the remediated items in question. Each QA will designate a single centralized authority for these determinations. The QA will notify the customer and TSP of the acceptability determination.

1.5.4.4.3.1. Remediation Unacceptable: When the QA determines that remediation efforts on items are unacceptable, the TSP shall dispose of the unacceptable items.

1.5.4.4.3.2. Remediation Acceptable: The QA will notify the customer when remediation efforts on items are determined to be acceptable and advise that further refusals to accept delivery of the acceptable items may result in a denial of any claim for loss or damage to those items. If the customer elects to accept delivery, the QA will notify the destination PPSO/PPPO, and they will direct the TSP to complete delivery of the acceptable items. If the customer still refuses delivery, the QA will electronically notify the destination PPSO/PPPO and TSP that the customer still refuses delivery and the destination PPSO/PPPO will direct the TSP to dispose of the items.

1.5.5.5. Accessorial Services payments for mold contamination: Accessorial services for mold remediation will normally be at the expense of the TSP, however, accessorial service payments may be authorized under limited circumstances when the QA determines the TSP is not liable for the damage.

MCOs will determine liability. Other factors that may warrant accessorial service payments include, but are not necessarily limited to, the number and size of contaminated shipments, the extent of contamination, the availability of remediation services in the location, and the actions of the customer.

Types of accessorial services that may be involved with mold remediation include but are not necessarily limited to Storage in Transit (SIT), preparation of new inventories, repacking, container costs, mold remediation firm services, estimate fees, drayage, TSP remediation costs, mold assessment testing, refused delivery charges, and disposal.

1.5.5.5.1. Destination PPSO/PPPO will approve accessorial service payments to TSPs for the cost of U.S. Government ordered testing or inspection or other charges occasioned by such orders when no outward indication of mold is present on the shipping container(s) and no mold is found in the container(s).

1.5.5.5.2. Code J, Code T and Code 5 mold contaminated shipments. Destination PPSO/PPPO will approve accessorial service payments to TSPs for mold remediation in all Code 5, Code J and Code T mold contaminated shipments regardless of liability, and on shipments where the TSP has been relieved of liability, up to the TSP’s maximum liability for that shipment. If the TSP is determined to be liable for the damages in a Code 5, Code J and Code T shipment, the U.S. Government will recover the payment either through voluntary refund from the TSP, offset, or through the claims process.

1.5.5.5.3. SIT before and during remediation on all other shipments. This service is normally at the expense of the TSP except for Code J, Code T, Code 5, or after a determination that the TSP is not liable.

1.5.5.6. Disposal after payment in lieu of remediation. Destination PPSO/PPPOs will approve accessorial service payments for TSP’s disposing of mold contaminated items when the TSP has made a payment to the customer in lieu of remediation and the TSP has exceeded their maximum liability on the shipment.

1.5.5.6.1. Disposal after refused delivery. Destination PPSO/PPPOs will approve accessorial service payments to TSP’s for refused delivery charges after remediation and the cost of disposal, when the customer refuses delivery if both of the following have occurred:

1) The QA has determined that the refused delivery was unreasonable under the circumstances, and

2) The TSP has exceeded their maximum liability on the shipment.

1.5.5.6.2. Accessorial services for mold remediation will not be paid nor used to reduce the TSP’s maximum liability if the TSP fails to obtain prior approval from the QA to commence remediation services. Reimbursement of accessorial services or reduction of a TSP’s maximum liability requires not only approval from the QA to commence remediation services but also a determination by the QA that the TSP is not liable for the mold. A TSP is not entitled to reimbursement of accessorial services and a reduction of their maximum liability. QA approval should be determined within ten GBDs of submission of a written, properly itemized estimate by the TSP.

1.6. Time Limitations on TSP Liability for Loss and Damage Claims

1.6.1. If the customer submits the claim to the TSP within 12 months of delivery, the TSP, subject to the exclusions stated in Section 1.3, above, will be liable for the full, undepreciated replacement value on all lost or destroyed items, as specified in Section 1.1, above. customers may transfer all or part of their claim to an MCO 30 days after filing the claim with the delivering TSP, provided that:

1.6.1.1. The claim has sufficient information upon which the TSP can reasonably adjudicate it. A claim is sufficient if it identifies the customer; contains facts sufficient to identify the shipment or shipments involved; asserts a demand for a specific or determinable amount; and specifies the items lost or damaged; and

1.6.1.2. The customer has considered and responded to any offer of settlement made by the TSP, and

1.6.1.3. The claim has not been fully satisfied or settled.

1.6.2. A claim may be transferred to an MCO before 30 days, and the TSP will remain liable for FRV if the following occur:

1.6.2.1. The customer receives notice that the TSP has made a final offer on a portion of the claim, denied a portion of the claim, or denied the claim in full. The claimant may transfer those portions of the claim denied or for which they received a final offer and are not in agreement.

1.6.2.2. The customer receives official notice from DPMO or the MCO that the TSP is in bankruptcy.

1.6.2.3. The customer receives official notice from DPMO, the MCO or a PPSO that the TSP has been in a Non-Use status or the TSP’s approval has been revoked, disqualified, or contract terminated by DPMO.

1.6.2.4. The TSP fails to comply with the catastrophic loss provisions in Section 2.10, below, as verified by the MCO.

1.6.2.5. The TSP fails to comply with essential items provisions in Section 2.11, below, as verified by the MCO.

1.6.3. Claims filed within 12 months of receipt of loss/damage but transferred to an MCO are still eligible for FRV.

1.6.4. The TSP will not be liable for loss or damage unless the customer either files a claim directly against the TSP within two years of the final delivery of the shipment that included the lost or damaged items, or files a timely claim against the United States and submits it to a MCO under the

PCA.

1.6.5. For the purposes of either the 12-month time limit for filing against the TSP or the two-year limit for filing against the TSP or the United States, if a claim accrues during war or an armed conflict in which an armed force of the United States is involved, or has accrued within two years before war or an armed conflict begins, and for cause shown, the claim must be presented within two years after the cause no longer exists or after the war or armed conflict ends, whichever is earlier. An armed conflict begins and ends as stated in a concurrent resolution of Congress or a decision of the President. An extension granted by this provision may be longer at the discretion of the TSP. If the TSP anticipates denying an extension, they must contact the MCO for a decision on whether the 12 month or two-year limit should be extended under this provision. Timeliness will be determined by the MCO based on the Military Service’s claims regulations and instructions. If the customer files a claim with an MCO, the TSP will not be liable to the U.S. Government on a recovery claim if the U.S.

Government does not dispatch a written demand to the TSP within four years of delivery. This four-year period will be extended by any period granted as per Section 1.5.4.1 above. If the U.S.

Government does dispatch a written demand to the TSP within four years of delivery, the U.S.

Government will have the normal six years specified in 28 U.S.C. § 2415, to resolve the claim or take administrative remedies.

1.6.6. If a customer files a claim directly with the TSP and then receives written or electronic notice from the TSP that all or part of the claim has been denied, then the customer may either file suit at personal expense against the TSP within two years of receipt of the notice or may transfer the claim to the appropriate MCO. If a recovery claim is not filed by an MCO against the TSP within four years of delivery, including extended periods as per Section 1.5.4 above, or the customer’s suit is not instituted within two years of receipt of the written notice, then the TSP shall not be liable for any part of the claim that was denied in the notice.

1.7. Liability for Goods in Storage

1.7.1. The TSP’s responsibility for a shipment and its liability under the bill of lading or service order for a shipment in NTS or SIT shall terminate, and the warehouse shall become the final destination of the shipment, on midnight of the day specified in the notice which the storage TSP receives through DPS from the PPSO advising that the U.S. Government nature of the shipment will terminate. The notice of termination is not retroactive. This notice of termination can be rescinded not later than one business day prior to the effective date of the termination.

1.7.2. The U.S. Government will pay the TSP for all NTS or SIT costs, up to and including the day of termination. Once termination, in accordance with Section 1.6.1, above, has occurred, the U.S.

Government may not revive the TSP’s liability under the original bill of lading or service order, or reinstate the original bill of lading or service order. If after termination, the U.S. Government wishes to continue the U.S. Government's payment for continued storage, the U.S. Government must enter into a new contract with the warehouse and/or issue a purchase order or new bill of lading for delivery and additional services needed after the termination notice.

1.7.3. In the event that NTS or SIT converts to the customer’s expense, the TSP is required to provide a copy of the Joint Inspection Form, (i.e., rider to the inventory or exception sheet) if a joint inspection occurred and it is requested by the MCO.

1.7.4. Goods booked into storage before 1 March 2008. Contracts for NTS of goods negotiated after 1 March 2008 must include liability provision for full replacement value (FRV). Goods stored under NTS contracts negotiated before 1 March 2008 may contain liability provision limiting TSP liability to depreciated value for losses or damage. Renegotiation of depreciated value contracts after 1 March 2008 must provide for FRV liability. Any such renegotiated contract will cause the NTS TSP to be liable for FRV for any damage suffered by the goods while in storage with that NTS TSP. If the NTS TSP can demonstrate clear and convincing evidence that the damage occurred prior to the renegotiation of the rates to FRV rates, then the NTS TSP will only be liable for the damage in accordance with the contract or TOS in effect immediately prior to the renegotiation of the rates.

1.8. High Value Items and High-Risk Inventories

1.8.1. High value/high risk items are rare, very high-end, highly pilferable, and/or expensive collectible items and may include, but is not limited to, currency, coins, jewelry, silverware and silver service sets, crystal, figurines, furs, objects of art, computer software programs, manuscripts, comic books, baseball cards, stamps, and other collectable items or rare documents, a collection of compact disks (CDs) and digital video disks (DVDs) will not be considered high value/high risk items. However, individual CDs or DVDs with a value in excess of $50.00 will be considered a high value item.

1.8.2. Collections should be noted at pack out and preparation of the origin inventory. Simply listing twenty-two (22) pairs Nike sneakers or “Jordans” is not sufficient to establish that such items constitute a collection.