Two hundred cartons go out. One hundred and eighty arrive intact, twenty arrive crushed at one corner. Your customer photographs them and short-pays the invoice. You call the carrier, and the carrier says the pallets were stacked badly before his driver ever touched them.
Three companies, one pile of damaged stock, and everybody is confident. What almost nobody does in that first hour is notice that there are two separate questions here, with two different answers and two different sets of parties.
Whose loss is it already, between you and your customer? That is answered by the sale, and it is usually settled before the truck moves.
Can whoever carries that loss make the carrier pay it? That is answered by the carriage, and it turns on who holds the rights, what can be proved, and what dates have passed.
Companies argue the second question and assume the first. It is normally the first one that decides who is out of pocket.
Between seller and buyer, the loss has usually landed before the truck leaves
Thai law does not wait for goods to arrive before deciding who owns them, and ownership is what carries the risk.
Section 458 transfers ownership to the buyer from the moment the contract of sale is entered into. Not on delivery, not on payment. At the contract. Section 459 delays that where the sale is subject to a condition or a time clause, until the condition is met or the time arrives.
Section 460 deals with the ordinary case of goods that are not yet identified when the deal is struck: for unascertained property, ownership does not pass until the goods have been numbered, counted, weighed, measured or selected, or their identity otherwise made certain. The same section holds ownership back where the seller still has to count or weigh something to work out the price.
Then Section 463: where the contract provides that the goods are to be sent from one place to another, delivery takes place at the moment the goods are handed to the carrier. Not when the consignee signs. When the truck takes them.
Put those together for a normal shipment. You pick and pack a specific order, which makes the goods ascertained under Section 460. You hand them to a carrier under a contract that says they go to your customer's site, which is delivery under Section 463. By the time the truck is on the highway the goods are usually the buyer's goods.
Section 370 completes it. Where a reciprocal contract is about transferring a real right in a specific thing, and that thing is lost or damaged by a cause not attributable to the debtor, the loss falls on the creditor. In a sale the seller is the debtor of the obligation to transfer, and the buyer is the creditor. Damage on the road that the seller did not cause is the buyer's loss. Section 464 adds that where goods are sent somewhere other than the place of performance, the buyer bears the transport cost.
None of this is compulsory. All of it is the default that applies when the contract is silent, and contracts are silent far more often than anyone admits. Which produces the sentence worth taking away from this section: your customer deducting the damaged cartons from your invoice is a commercial decision, not automatically a legal entitlement, and if your terms say nothing, the default may well be against them rather than against you.
The reverse is just as true when you are the buyer. If you agreed to collect, or your supplier's terms hand the goods over at their gate, the damage that happened three provinces away is already yours.
| What you sold | Where ownership normally sits mid-journey |
|---|---|
| A specific, identified item agreed in the contract | Buyer, from the contract date |
| Goods picked and packed from stock for this order | Buyer, from when they were selected and made certain |
| Goods still to be weighed to fix the price | Seller, until that is done |
| Anything under a written term saying otherwise | Whatever the term says |
The carrier has three ways out, not two
Once you know whose loss it is, the next question is whether the carrier has to reimburse it.
Section 616 makes the carrier liable for goods entrusted to him that are lost, damaged or delivered late, unless he proves one of three things: force majeure, the nature of the goods themselves, or the fault of the sender or the consignee.
The reversed burden is the part that favours you. You do not have to show the driver did anything wrong. The carrier has to show he was not the cause.
The middle defence is the part most shippers forget, and it is the one aimed straight at the crushed corner in the example above. If the damage came from what the goods are and how they behave, rather than from the journey, the carrier walks. Cartons that cannot support their own stack height, fruit that was already ripening, a machine bolted to a pallet that was never built to hold it: those are arguments about the nature of the goods, and they are the carrier's best answer to a damage claim. The way to beat that argument is not to be right in the meeting. It is to have packed and loaded in a way that makes it obviously wrong.
Section 617 keeps the carrier liable for the fault of other carriers and of anyone he entrusted the goods to, so subcontracting the truck out does not move the exposure. Section 618 makes several carriers jointly liable where more than one moved the goods.
Whether an insurance policy then pays any of this is a different chain again, with its own assured, its own exclusions and its own clocks. That is the subject of what cargo insurance actually covers on a Thai road, and it is worth reading before you rely on the word "insured" in a conversation.
The right to sue moves to the consignee, and the terms move with it
Here is where well-run companies claim against the wrong party or claim as the wrong party.
Section 627: once the goods have arrived at the place designated for delivery and the consignee has demanded delivery, the sender's rights arising from the contract of carriage pass to the consignee.
Read that against the ordinary arrangement. You booked the truck. You signed with the carrier. You paid the freight. Your customer took delivery. Your customer is now the one holding the rights under your carriage contract, and you are the one holding a short-paid invoice. If you then sue the carrier in your own name, expect to spend the first part of the case arguing about whether you are the right plaintiff at all.
The rights do not travel alone. They arrive with whatever terms were attached to them. Section 625 makes an exemption or limitation of the carrier's liability given on a receipt or consignment note void unless the sender expressly accepted it, and in judgment 1282/2524 the Supreme Court applied that both ways: a limitation added to a consignment note that the sender had never expressly accepted could not be used against the consignee either, nor against the insurer that had stepped into the consignee's position. The mirror image follows. A limit the sender did expressly accept is inherited by the consignee along with everything else.
So two things need deciding before the goods move, not after they arrive broken:
- Who claims. If the risk sits with your buyer but the contract sits with you, say in writing which of you pursues the carrier and how the other is made whole
- What was accepted. Anything the carrier hands over at the gate that limits liability binds nobody unless it was expressly accepted, and whatever was expressly accepted binds the receiving end too
What you can actually recover is narrower than what it cost you
Section 222 sets the measure. You can claim compensation for all damage that usually arises from the non-performance. You can also claim damage arising from special circumstances, but only if the party concerned foresaw those circumstances or ought to have foreseen them.
That line runs straight through a typical damage claim:
| The loss | Usually recoverable |
|---|---|
| Replacement or repair value of the damaged goods | Yes, as ordinary damage |
| Freight paid on the ruined portion | Yes, as ordinary damage |
| Your customer's penalty for a stopped production line | Only if the carrier could foresee it |
| A lost contract or a cancelled order downstream | Only if the carrier could foresee it |
Foreseeability is not luck. It is something you create, in writing, at booking time, by saying what is on the truck and what depends on it arriving intact. A booking that says "40 pallets, Rayong to Bang Na" makes almost nothing foreseeable. A booking that says what the goods are, what they are worth and that they feed a line running that afternoon makes rather a lot of it foreseeable.
Two more limits sit alongside it. Section 621 caps compensation for late delivery at what a total loss would have been worth. Section 620 removes the carrier's liability entirely for money, notes, bills, bonds, shares, jewels and other valuables unless he was told their nature or value when the goods were handed over, and caps it at the declared value if he was.
Do not withhold the freight
The instinct when a load arrives damaged is to stop paying for it. It is the wrong move, three times over.
Section 623 ends the carrier's liability when the consignee has accepted the goods without reservation and paid the freight and accessories. Withholding freight does not preserve your claim. Writing the damage on the receipt is what preserves your claim. The same section keeps hidden damage alive if the carrier is told within eight days of delivery, and the one-year bar in Section 624 runs from delivery, or from when delivery should have been made, except in cases of fraud.
Section 630 lets the carrier retain the goods until the freight and accessories are paid. Refusing to pay in order to force a settlement is a good way to leave your own stock sitting on somebody else's truck.
Section 628 is the one exception worth knowing, and it is about loss rather than damage: if the goods are lost through force majeure, the carrier has no right to the freight, and any freight already received must be returned in full. The event that removes the carrier's liability under Section 616 also removes his right to be paid for the journey.
The correct sequence is unglamorous. Note the damage on every copy of the receipt. Take delivery. Pay the freight. Claim separately, in writing, against whoever owes it.
If it does not settle
Most of these are settled commercially, because the amounts are small relative to the relationship. When one does not:
A domestic road move is an ordinary civil claim in the ordinary courts. An international carriage dispute goes to the Intellectual Property and International Trade Court, whose founding Act gives it civil cases on international sale, international services, international carriage and the insurance connected to them. That distinction is worth knowing early, because it changes which court, which procedure and which specialist adviser you need.
The filing fee is 2 percent of the amount claimed, capped at 200,000 baht for claims up to 50 million, with 0.1 percent on anything above that. The shape of that fee matters more than the number. A 300,000 baht claim costs 6,000 baht to file. A 20 million baht claim also stops at 200,000. Small claims are the ones where the fee, the lawyer and the year of management attention quietly exceed the loss, which is exactly why carriers settle large claims and argue small ones.
And the clock never stops for negotiation. One year from delivery under Section 624, whatever anybody promised in the meantime.
What to change on Monday
- Read your own sale terms and find the sentence that says when risk passes. If there is no such sentence, the defaults above are your terms, and they may not be the ones you think you have
- Decide, in writing, who claims against the carrier when the buyer holds the goods and the seller holds the carriage contract
- Put the value and the consequence into the booking, not into the argument afterwards. Foreseeability under Section 222 is created before the truck moves
- Pack and load so that "the nature of the goods" is not an available defence. Photograph the load secured, on the truck, before the doors close
- Give the receiving dock one rule that never bends: note the damage on every copy, then take delivery and pay the freight
- Diary eight days for hidden damage and one year from delivery, from the delivery date rather than from the day the argument started
- Ask, before booking, whether anything the carrier will hand your driver at the gate contains a liability limit, and decide whether you are accepting it. It binds your customer too
The same discipline that makes two freight quotes comparable is what makes a damage claim winnable: knowing exactly what was agreed, by whom, and on what terms, before anything goes wrong.
A damage claim is rarely lost on the merits. It is lost because the loss had already moved to somebody else under the sale, or the rights had already moved to somebody else under Section 627, or the receipt was signed clean, or the year ran out while two companies were being reasonable with each other.