Golden Land Trans. Insurance

Long Beach drayage company sues German container shipper over detention fees

Chaos at California’s ports continues amid unprecedented container volume as a Long Beachbased drayage company is suing international shipping and transportation container company Hapag-Lloyd. Orange Avenue Express alleges the German company forced them to store empty reefer containers without payment.

In its complaint with the Federal Maritime Commission, Orange Avenue also alleges that Hapag-Lloyd compiled over $250,000 in detention charges in a direct violation of U.S. shipping regulations. It may be the first time a trucking company has filed a suit against a shipping company for overcharges and late fees.

Last April, as the ports at Los Angeles and Long Beach became backlogged with shipping containers, storage space for the empty containers was hard to find so Hapag-Lloyd made drayage companies send an email each day inquiring about space availability.

But, when Orange Avenue attempted to make an appointment to return an empty container to the shipping company all appointments had been previously filled, contrary to what Hapag-Lloyd had earlier stated.

“When Hapag was notified that no appointments were available, Hapag would reply that it had no control over the terminal appointment system,” according to the lawsuit. “Further, after repeated requests, Hapag failed to provide an overall solution to the daily refusal to accept empty reefer container returns or lack of appointments.”

Orange Avenue did take advantage of as many “dual” gate appointments as possible. These appointments allowed them to drop off an empty when picking up a full container.

“However, because of the continuous lack of Hapag’s empty return locations, empty refer containers began accumulating at the OAE yard,” the trucking company said. “Since the full containers were originally pulled as overweight containers on specialized tri-axle chassis, many empties remained on the specialized OAE-owned chassis for lengthy periods of time.”

At one point, Orange Avenue was close to shutting down because of a lack of those free chassis.

“Instead of adequately allowing for opportunities to return empty reefer containers, Hapag involuntarily forced OAE to act as a storage facility for Hapag empty containers without compensation,” the complaint said. In addition, Hapag-Lloyd charged “unreasonable, arbitrary and capricious” detention fees. According to the suit, “Hapag would still charge daily detention at $400 per day, per container even if the empty, in reality, could not be returned through the actions of Hapag or its designated terminals.”