Storage Fees and Legal Liability

Storage fees are one of the most common cost items in logistics, foreign trade, customs clearance, maritime transportation, warehousing, and storage processes. If goods remain in a port, terminal, warehouse, temporary storage area, storage facility, or logistics center for a certain period, storage fees may arise due to this waiting time. In import and export transactions, failure to retrieve goods on time, delays in customs procedures, missing documents, the buyer's refusal to take delivery of goods, or disruptions in transportation organization can rapidly increase storage costs.

Storage fees are often confused with demurrage and detention fees in practice. However, storage is essentially the storage cost incurred due to goods or containers waiting in a storage area. Demurrage and detention, on the other hand, relate more to the use of the container as carrier equipment for an extended period. Therefore, in storage disputes, it is crucial to correctly determine which fee is being charged for which service or waiting period.

Storage fees can reach high amounts, especially in import transactions. As goods wait at customs, a daily storage fee may be charged by the port or warehouse operator. This can result in costs approaching or exceeding the value of the goods. Therefore, it is crucial to carefully consider who is responsible for the storage fees, who is at fault for the delay, the fee schedule, and whether legal recourse is possible.

What is a storage room?

Storage fee is the charge levied for a specific period of time for goods to be kept in a port, warehouse, temporary storage area, terminal, storage facility, or similar location. This fee can be calculated based on the space occupied by the goods in the relevant area, the waiting time, the nature of the goods, the storage conditions, and the service tariff.

Warehousing costs are not unique to maritime transport. Similar costs can arise in road, air, rail, and combined transport processes due to storage or temporary waiting periods. However, in practice, they most frequently occur in ports, warehouses, and customs areas.

Storage fees typically accrue when goods are not collected or customs procedures are not completed within a specified period. Some businesses may grant a grace period. Daily or periodic storage fees begin to apply after this grace period expires.

Who is responsible for the storage fee?

Who is responsible for storage fees is determined according to the specifics of the case. The importer, exporter, buyer, seller, carrier, freight forwarder, customs broker, or warehouse/storage operator may, in some cases, be a party to the dispute regarding responsibility for storage costs.

Generally, the party responsible for receiving the goods or completing customs procedures is considered liable for storage charges. However, if the reason for the delay is different, the storage costs may be recouped from the party that caused the delay.

For example, if the importer fails to submit the necessary documents on time and the goods are therefore held at customs, the importer may be liable for the storage costs. If the seller submits incomplete or incorrect documents, the importer can claim back the storage fees paid. If the customs broker makes a mistake or delays the application, the broker's professional liability may arise. If the freight forwarder transmits the documents late or miscoordinates the process, the forwarder's liability may be questioned.

Therefore, in warehousing disputes, it is not sufficient to look at the invoice alone. The reason for the delay, the contract between the parties, the Incoterms delivery method, customs records, and correspondence should be examined together.

How is storage fee calculated?

Storage fees are generally calculated based on the length of time the goods are stored, the space they occupy, the type of goods, the storage area tariff, and the terms of service. Port, warehouse, or storage facility operators may apply their own fee schedules. In some cases, calculations are made based on pallets, containers, tons, cubic meters, boxes, or days.

In warehousing accounts, the free period is of great importance. The free period is the time during which goods can remain in the relevant area without incurring any warehousing fees. Warehousing begins after this period expires. The start and end dates of the free period must be carefully examined in case of disputes.

The storage invoice must clearly indicate which goods or containers are charged, the date range specified, and the tariff applied. The invoice can be challenged if the calculation is unclear or unverifiable.

The Difference Between Storage, Demurrage, and Detention

Storage, demurrage, and detention are fees that are often confused in practice but have different legal and commercial meanings. Storage is the fee incurred due to goods waiting in a port, warehouse, or storage facility. Demurrage is the fee charged by the carrier because the container exceeds the free time in the port area. Detention arises when a container is not returned within the specified time after it has been removed from the port.

In an import transaction, these three charges may arise simultaneously. For example, demurrage may be charged because the container is waiting at the port, storage fees may be charged because the goods are waiting in the port area or warehouse, and detention fees may be charged because the container is returned late after leaving the port.

Therefore, incoming bills need to be categorized. Paying without determining which charge corresponds to which service or delay can lead to unnecessary or unfair expenses for the company.

Storage resulting from customs procedures

One of the most common reasons for detention charges is delays in customs procedures. In import procedures, goods may be held in the customs area after arriving in Türkiye due to delays in customs declarations, import permits, conformity checks, certificates of origin, HS code checks, valuation inspections, or analysis processes.

The longer the waiting period, the higher the storage fee. The delay may be due to missing documents from the importer. Incorrect documents submitted by the seller, delays in processing by the customs broker, inspections by public administration, or the product not complying with regulations can also lead to storage fees.

In customs-related storage disputes, declarations, invoices, packing lists, certificates of origin, bills of lading, CMR documents, customs correspondence, analysis reports, and emails between the parties are crucial. These documents should clearly demonstrate which party is responsible for the delay.

Storage due to missing or incorrect documents

In international trade, missing or incorrect documents are among the most common causes of warehousing costs. Deficiencies in commercial invoices, certificates of origin, bills of lading, packing lists, certificates of conformity, import permits, or insurance documents can delay the delivery of goods.

If the missing documents are due to the seller, the importer can claim the storage costs from the seller. If the carrier or forwarder delivered the documents late, their liability may be questioned. If the customs broker failed to notice obvious errors in the documents provided or did not submit the application on time, their professional responsibility may be debated.

Therefore, document responsibility should be clearly regulated in foreign trade contracts. The contract should specify which document must be provided, by whom, by what date, and in what format.

Storage due to buyer's failure to take delivery of goods

Failure of the buyer to take delivery of the goods or delays in the delivery process can also result in storage costs. Goods may remain at the port or warehouse if the buyer fails to make payment, initiate import procedures, receive documentation, or arrange storage.

In this case, storage costs incurred by the seller, carrier, or forwarder can be claimed from the buyer. However, for this claim to be strong, the buyer must have been notified in a timely manner, and the delay and increased costs must be communicated in writing.

The seller's obligation to mitigate losses in the event of the buyer's non-delivery should also be considered. Instead of prolonged storage, options such as resale, transfer to another warehouse, return, or legal action may be evaluated.

Freight Forwarder's Warehousing Responsibility

Freight forwarders, as the party organizing the transportation and logistics process, frequently face claims of liability in warehousing disputes. The forwarder's liability is determined by the scope of the service they undertake.

If the forwarder has only organized the transportation, the delay to be held liable for storage costs must be due to their own fault. For example, they may be liable if they delivered the documents late to the customer, failed to inform them of the free time, misdirected the customs process, or made mistakes in organizing the delivery.

However, the forwarder's liability may be limited if the storage cost arises entirely due to the client's lack of documentation, non-payment, or delays in customs procedures. Therefore, forwarder agreements should clearly define who is responsible for storage costs and the limits of the forwarder's liability.

Responsibility of Warehouse and Storage Facility Operation

The party requesting storage fees is most often the warehouse, storage facility, port, or terminal operator. These operators charge a fee for storing the goods for a specific period. However, the fee requested must be in accordance with the contract, the tariff, and the actual service provided.

A warehouse or storage facility operator must be able to document how long the goods remained in storage, which tariff was applied, and which services were provided in order to charge a fee. The storage period, entry and exit records, and invoice items must be clearly documented.

If the storage invoice is unclear, excessively high, or duplicated, it can be challenged. Furthermore, if the delivery of goods is delayed due to the fault of the warehouse operator, it becomes legally questionable whether the storage costs arising from this delay should be borne by the owner of the goods.

Objection to Storage Invoice

When a storage invoice arrives, the basis for the invoice should first be examined. It is necessary to determine the date the goods entered the warehouse or port, the date they left, whether a free period was applied, the tariff used for the calculation, and which service the fee relates to.

If the invoice is incorrect or unfair, a written objection must be made within the stipulated time. The objection should clearly state the invoice items, the reason for the delay, the contract terms, the free period, and relevant records. Since remaining silent about an invoice in commercial relations can be interpreted adversely in some cases, action should be taken promptly against unfair storage invoices.

Even if the storage invoice has been paid, it is possible to make the payment under reservation and subsequently seek recourse from the responsible party. This strategy is particularly preferable in situations where delivery of the goods is urgent.

Collection of Warehousing Receivables

When a warehouse, storage facility, port operator, carrier, or logistics company is unable to collect its storage fees, it may resort to legal action. This may include enforcement proceedings, appeals against objections, debt collection lawsuits, or commercial lawsuits.

The creditor must prove the basis of their storage fee claim with concrete documentation. The contract, price list, warehouse entry and exit records, delivery documents, invoice, current account statement, and correspondence are important.

The debtor may argue that the fee is unfair, that the delay was not their fault, that the free period was calculated incorrectly, that there are duplicate items on the invoice, or that they are not responsible for this expense under the contract.

The Problem of Exorbitant Storage Fees

Storage fees can sometimes reach amounts approaching or exceeding the value of the goods. In such cases, the question of whether the fee is exorbitant may arise. Storage costs can be particularly high in cases of prolonged customs delays, administrative inspections, or undelivered goods.

In assessing price gouging, consideration should be given to contract terms, tariff, free period, market practices, waiting time, cause of delay, and the parties' obligation to mitigate damages.

The party requesting storage must prove that the fee is in accordance with the applicable tariff. The debtor, on the other hand, must demonstrate with evidence that the fee is excessive, unfair, or duplicate. Expert examination may be required in such disputes.

Storage and Detention Rights

In some cases, a warehouse or storage facility operator may refuse to deliver goods without payment of storage fees. This situation gives rise to debates about the right of retention or refusal of delivery in practice. However, the exercise of this right must be evaluated according to the specific legal relationship, contract, and legislation.

Especially when dealing with goods under customs supervision, perishable goods, or goods belonging to third parties, preventing delivery can have serious legal consequences. Therefore, halting delivery to collect storage fees should be carefully considered in each case.

It is important for the parties to include clear provisions in the contract regarding this matter. The contract should specify which rights will be exercised in case of non-payment, how long the goods may be held, and how perishable goods will be handled.

Reimbursement of Storage Costs

The party obligated to pay storage fees may seek recourse from the party causing the delay. For example, an importer may have paid storage fees to be able to retrieve the goods. However, if the delay is due to the seller submitting incomplete documentation, the importer can claim a refund of the storage fees paid from the seller.

Similarly, if a forwarder has paid storage fees on behalf of their client, they can pass this cost on to the client. If storage fees arise due to an error by the customs broker, the injured party can claim compensation from the broker.

The most important aspect of recourse claims is proving that the storage fee was actually paid and that the delay was due to the fault of the other party. Payment receipts, invoices, correspondence, and customs records are crucial in this regard.

Evidence in Storage Disputes

The primary evidence in warehousing disputes includes: warehouse or port entry and exit records, warehousing invoices, price lists, free period information, customs declarations, bills of lading, CMR documents, delivery documents, bonded warehouse records, customs administration correspondence, email correspondence, payment receipts, and notices of default.

These documents must clearly show the date the goods began to be held in storage, when they could be delivered, why they could not be delivered, and which party is delaying the process.

If storage charges have been paid, it is also important to know which invoice the payment relates to and whether there are any reservations. If an unfair or excessive payment is alleged, the objection process must be supported by written documents.

How should storage fees be regulated in the contract?

To mitigate storage risk, foreign trade, transportation, warehousing, and logistics contracts should contain clear provisions. The contract should regulate free time, storage fees, the party responsible for costs, notifications of delays, obligation to provide documents, and recourse clauses.

Import and export contracts must clearly state who is responsible for providing the necessary documents and who is responsible for storage costs in case of delay. Logistics contracts must also specify the extent to which the forwarder or carrier is responsible for storage costs.

Such arrangements strengthen the position of the parties in case of a dispute and prevent unjustified claims for expenses.

Legal Support in Storage Disputes

Warehousing disputes are technical cases with dimensions of logistics law, customs law, contract law, and commercial law. Whether the warehousing invoice is legally valid, from whom the fee should be demanded, whose fault caused the delay, and the possibility of recourse must be carefully considered.

The lawyer examines the storage invoice and supporting documents, objects to the unfair invoice, sends the necessary warnings, and conducts mediation or litigation. From the creditor's perspective, enforcement proceedings, appeals against the objection, or a lawsuit for debt collection can be initiated.

For companies engaged in foreign trade, having contracts legally reviewed before warehousing costs arise is crucial for preventing significant financial burdens.

Conclusion

Storage charges are significant logistics costs incurred due to goods waiting in ports, warehouses, storage facilities, or terminals. Delays in customs procedures, missing documents, non-delivery by the consignee, forwarder coordination errors, or disruptions in the warehousing process can all lead to storage costs.

Who is responsible for storage fees is determined by the contract terms, Incoterms delivery method, customs records, waiting time, free period, and the reason for the delay. Therefore, storage invoices should be carefully examined, and objections should be raised in a timely manner against unfair or excessive claims.

Clearly worded contracts, complete documentation, and seeking support from a lawyer experienced in logistics law in case of disputes are crucial for reducing storage risks during import, export, transportation, and warehousing processes.