USC-9_PWS_Att_8_DLA_PV_(Clean_Version).pdf

DRAFT

Universal Service Contract -9 Exhibit 3, Performance Work Statement, Attachment 8

SHIPMENTS OF DLA PRIME VENDOR CARGO

1. Special Provisions for Defense Logistics Agency (DLA) Prime Vendor Program

1.1 Contractual Intent. Generally, the terms, conditions and prices of this contract shall apply equally to the transportation of both Government owned and non-Government owned cargo. For example, the standard of liability of a USC Contractor for loss/damage to cargo is the same in both situations. Also, compensation due the USC Contractor for detention of carrier containers, for port storage, for reefer maintenance, and other matters is the same in both situations. For Operational Rations (OPRATs) or Government Furnished Material (GFM), title transfers to the Government once cargo is shipped. However, experience has demonstrated to the Government that certain matters are properly handled directly between a Prime Vendor and a USC Contractor (the real parties in interest) where non-Government cargo in involved. These matters include:

a) Claims procedures and claims dispute resolution procedures related to Prime Vendor cargo and Prime Vendor claims against a USC Contractor for loss/damage to Prime Vendor cargo;

b) USC Contractor claims against a Prime Vendor for loss/damage to USC Contractor equipment;

c) USC Contractor claims against a Prime Vendor for detention of USC Contractor equipment;

d) USC Contractor claims against a Prime Vendor for port storage charges (e.g. while cargo delayed through fault of Prime Vendor or request of Prime Vendor);

e) USC Contractor claims against a Prime Vendor for trucker wait time (e.g. while cargo delayed through fault of Prime Vendor or request of Prime Vendor);

f) USC Contractor claims against a Prime Vendor for reefer maintenance (e.g. while reefer in custody of Prime Vendor, or cargo delayed through fault of Prime Vendor or request of Prime Vendor); and,

g) Claims between the Prime Vendor and USC Contractor for services not ordered by the Government

This stands to reason because the Prime Vendor owns the cargo and because only the Prime Vendor and a USC Contractor have specific, factual knowledge and evidence related to such matters and the delivery location, DLA’s Prime Vendor contracts involving the cargo movements outside of the Continental United States (OCONUS) require the Prime Vendor to sign an agreement (which the USC Contractor may accept and seek to supplement) establishing a minimum level of claims processing and dispute resolution procedures. This contract requires the carrier to accept a minimum level agreement to be eligible for the carriage of Prime Vendor cargo OCONUS. The contractual intent is for the Prime Vendor and the USC Contractor to address/resolve such matters directly with each other. The Government customer can be harmed when procedures for resolving such matters between the Prime Vendor and a USC Contractor are not established and problems are not resolved directly between the Prime Vendor and the USC Contractor. However, the USC Contractor may submit claims for issues arising out of the control of both the Prime Vendor and the USC Contractor.

1.1.1 The following are the responsibility of the USC Contractor and any costs associated with their failure to provide these services, in accordance with this PWS, shall be borne by the USC Contractor:

a. Spotting equipment at the date and time agreed upon by the Vendor and the Carrier

b. Picking-up cargo at the date and time agreed upon by the Vendor and the Carrier

c. Allowing 2 business days to schedule delivery appointments.

d. Providing an accurate Bill of Lading (B/L)

e. Notifying the Government within 24 hours of discovering a seal on any unit of cargo has been broken and/or replaced.

f. Ensuring refrigerated containers maintain a temperature within three degrees Fahrenheit for chilled cargo, or five degrees Fahrenheit for frozen cargo, of the temperature requested in the booking.

The Prime Vendor shall submit any claims related to the above directly to the USC Carrier. The U.S. Government shall not be liable for loss or damage to Prime Vendor cargo. Any discrepancy report or notice of claim for such loss or damage shall be submitted by the DLA Prime Vendor directly to the USC Contractor for resolution, not to DLA or USTRANSCOM. The USC Contractor shall accept such discrepancy report or notice of claim for such loss or damage from the DLA Prime Vendor, as well as any other communications regarding such loss or damage.

1.1.2 The following are the responsibility of the Prime Vendor Contractor and any costs associated with their failure to provide these services, in accordance with the Prime Vendor Contract, shall be borne by the Prime Vendor:

a. Loading containers at the date and time agreed upon by the Vendor and the Carrier

b. Providing accurate and timely Health Certificates and Commercial Invoices and Packing Lists

c. Receiving and unloading of cargo at the date and time agreed upon by the Vendor and the Carrier

The Carrier shall submit any claims related to the above directly to the Prime Vendor. The U.S Government shall not be liable for USC Contractor claims against a Prime Vendor for loss/damage to USC Contractor equipment;

USC Contractor claims against a Prime Vendor for detention of USC Contractor equipment; USC Contractor claims against a Prime Vendor for port storage charges (e.g. while cargo delayed through fault of Prime Vendor or request of Prime Vendor); USC Contractor claims against a Prime Vendor for trucker wait time (e.g. while cargo delayed through fault of Prime Vendor or request of Prime Vendor); USC Contractor claims against a Prime Vendor for reefer maintenance (e.g. while reefer in custody of Prime Vendor, or cargo delayed through fault of Prime Vendor or request of Prime Vendor); and claims between the Prime Vendor and USC Contractor for services not ordered by the Government).

1.1.3 The Government may be responsible for the following and any costs associated with their failure to provide these services:

a. Clearing Customs

b. Providing accurate and timely shipping instructions

The carrier shall submit claims related to the above directly to the Government.

1.1.4 The Contractor and the Prime Vendor should include any common issues not delineated above in their Prime Vendor/USC Carrier Agreements.

1.2 Prime Vendor and USC Contractor Agreements for OCONUS: The USC Contractor is required, after notification of an award of any route for Prime Vendor cargo movement, to enter into a written agreement with the Prime Vendor which should, at a minimum, use the Prime Vendor/USC Carrier Agreement to define procedures to submit and process claims and resolve disputes arising in connection with U.S. Government ordered transportation services for non-Government owned cargo. The Prime Vendor/USC Carrier Agreement is the minimum instrument required to address the matters described in 1.1.1 and 1.1.2. A copy of the agreement and any negotiated supplemental language in respect thereof or changes thereto, shall be furnished to the USC Contracting Officer.

1.3 Supplementation Encouraged. The USC Contractor is encouraged, but not required, to supplement the terms of the sample agreement located in paragraph 2 with each Prime Vendor by providing additional details, more specific procedures, or other terms that will facilitate claims processing and dispute resolution. Supplementary language must be consistent with this Attachment. A copy of any supplemental terms must be provided to the USC Contracting Officer. In negotiating any agreement, the USC Contractor should consider that the Prime Vendor may exercise a right of setoff, if any exists, involving a commercial contract or other remedial action against the USC Contractor. Similarly, the USC Contractor may take remedial action or other actions to protect its interests against the Prime Vendor, including the assertion of a lien, if any exists, on Prime Vendor cargo.

2. Sample Prime Vendor Carrier Agreement

PRIME VENDOR/USC CARRIER AGREEMENT

WHEREAS, components of the Defense Logistics Agency (DLA) have entered into contracts with various suppliers and distributors under a “Prime Vendor” (PV) program to supply various commodities to U.S. Government agencies and under this program the PVs retain title to such commodities until final delivery;

WHEREAS, DLA’s PV contracts permit components of DLA to order transportation services from commercial carriers under a contract with the United States Transportation Command (USTRANSCOM) known as the Universal Services Contract (USC);

WHEREAS, USC carriers transport PV commodities and return them to PVs at a different location prior to delivery of same by the PV to U.S. Government agencies;

WHEREAS, past experience has demonstrated that PVs and carriers may disagree about claims procedures and claims dispute resolution procedures related to PV cargo, including PV claims against a USC Contractor for loss/damage to PV cargo; USC Contractor claims against a PV for loss/damage to USC Contractor equipment; USC Contractor claims against a PV for detention of USC Contractor equipment; USC Contractor claims against a PV for port storage charges (e.g. while cargo delayed through fault of PV or request of PV); USC Contractor claims against a PV for trucker wait time (e.g. while cargo delayed through fault of PV or request of PV); USC Contractor claims against a PV for reefer maintenance (e.g. while reefer in custody of PV, or cargo delayed through fault of PV or request of PV); and claims between the PV and USC Contractor for services not ordered by the Government;

WHEREAS, ____________________________________________(hereinafter referred to as The PV) has been awarded contract number _______________________________ by ________________________________________________ for the supply of PV cargo;

WHEREAS, one or more carriers under the USC may serve the geographical area covered by said contract and transport PV commodities intended for performance of said contract;

NOW, THEREFORE, in consideration of the mutual promises herein and for the purpose of facilitating minimum standards for the processing of claims and the resolution of disputes between The PV and applicable USC carriers, The PV and any USC carrier accepting the terms of this Agreement (hereinafter referred to as Accepting USC Carrier) agree as follows:

1. The PV and Accepting USC carrier agree to adhere to the booking requirements of the transportation services ordered. Cargo ordered for delivery to a PV location shall be accepted by the PV upon delivery by the USC carrier.

If the cargo is suspected to be in an unacceptable condition for delivery, the PV and USC carrier will abide by the destination services requirements for delivery and receipt notifications. If the cargo is determined to be in an unacceptable condition, the PV and USC Carrier agree to resolve these claims after delivery and subsequent destruction of the cargo.

2. The PV will submit directly to the Accepting USC Carrier (not to DLA or USTRANSCOM) for resolution any discrepancy report or notice of claim for loss/damage to PV cargo, for services not ordered by DLA/USTRANSCOM, or for ending container detention charges or other matters. The Accepting USC Carrier shall accept such report/notice and both parties agree to communicate with each other regarding the processing of claims.

The parties may (but are not required to) supplement this minimum level of agreement with additional or more specific terms and conditions consistent with this Agreement and Attachment of the USC contract.

3. The Accepting USC Carrier will submit to the PV (not to DLA or USTRANSCOM) for resolution any notice of claim for equipment loss/damage, container detention, maintenance of refrigerated containers, port storage, services not ordered by DLA/USTRANSCOM, procedures for ending container detention charges, or other matters. The PV shall accept such notice of claims and both parties agree to communicate with each other regarding the processing of claims. The parties may (but are not required to) supplement this minimum level of agreement with additional or more specific terms and conditions consistent with this Agreement and Attachment of the Exhibit 3, PWS in the USC contract.

4. When the claims process does not lead to resolution of the claim, the parties agree to initiate some form of dispute resolution process (which could include direct negotiation, alternative dispute resolution, court action, etc.)

that does not involve the U.S. Government (including DLA/USTRANSCOM.) The parties may (but are not required

to) supplement this minimum level of agreement with additional or more specific terms and conditions consistent with this Agreement and Attachment of the Exhibit 3, PWS in the USC contract.

5. The PV and the Accepting USC Carrier will notify their respective Contracting Officers of any refusal to communicate regarding the processing of a claim and of any failure to attempt to resolve a dispute.

6. The PV and the Accepting USC Carrier acknowledge that the terms of their contracts with the U.S. Government (DLA and USTRANSCOM respectively) generally preclude liability of the Government for the following: PV claims against a USC Contractor for loss/damage to PV cargo; USC Contractor claims against a PV for loss/damage to USC Contractor equipment; USC Contractor claims against a PV for detention of USC Contractor equipment;

USC Contractor claims against a PV for port storage charges (e.g. while cargo delayed through fault of PV or request of PV); USC Contractor claims against a PV for trucker wait time (e.g. while cargo delayed through fault of PV or request of PV); USC Contractor claims against a PV for reefer maintenance (e.g. while reefer in custody of PV, or cargo delayed through fault of PV or request of PV); and claims between the PV and USC Contractor for services not ordered by the Government.

7. The parties acknowledge that the terms of the USC contract are applicable to this Agreement and incorporate by reference into this Agreement the USC contract in force at the time PV cargo is booked. For example, the standard of liability of an Accepting USC Carrier for loss/damage to PV cargo is the same as the standard of liability of a USC carrier for loss/damage to government-owned cargo under USC. Similarly, the compensation due an Accepting USC Carrier for damage to its equipment, detention of its containers, port storage of its equipment, and maintenance of its refrigerated containers is the same as the compensation due to a USC Carrier for such matters under USC.

Attachment 8 to the USC contract describes specific provisions of the USC contract that are modified to acknowledge that the transportation described herein involves PV cargo, not government-owned cargo; that USC carriers deliver cargo back to the PV, not to the Government; and that the real parties in interest for PV cargo movements are generally the PV and the USC carrier, not the Government.

XXXXXXXX XXXXXXXXX, INC.

“The Prime Vendor ____________________________________ Date:

By:

Title:

The undersigned, an authorized representative of YYYYYYYYYYYYYY YYYYYYYYY, INC., hereby accepts and agrees to the terms and provisions above of this Agreement.

YYYYYYYYYYYYYYYYYY YYYYYYYY, INC.

“Accepting USC Carrier”

_____________________________________ Date:

By:

Title:

SUPPLEMENTAL TERMS AND CONDITIONS

(If the parties agree to supplement this minimum level of agreement with additional or more specific terms and conditions consistent with this Agreement and Attachment of the PWS in the USC contract, the parties may record their supplemental agreement below OR may record it elsewhere.)