Statute of Limitations on Freight Charges: 18 Months

A carrier has 18 months to bring an action to collect unpaid freight charges. Under 49 U.S.C. 14705, that period runs from the accrual of the claim, and claims accrue on delivery or tender of delivery of the shipment. The same statute gives you, the shipper, 18 months to sue for an overcharge, or three years if you file it as a complaint with the Board or the Secretary instead of in court.

So the statute of limitations on freight charges is symmetrical at the headline level and asymmetrical in the details. The details are where the money is.

Take them one clock at a time: the collection clock, the overcharge clock, how they interact with the 180-day billing and contest windows, and why loss and damage claims run on a completely separate schedule that people routinely confuse with this one.

The four periods in 14705

The section sets several different limitation periods depending on what is being sued over and who is suing. Getting the right one is most of the work.

Two structural notes on the table.

Accrual is a defined moment, not a judgment call. The statute ties accrual to delivery or tender of delivery of the shipment. Not the invoice date. Not the payment date. Not the date somebody in accounting noticed the problem. When a carrier tells you the clock started when it sent the final demand, that is not what the statute says.

The three-year Board or Secretary route is a real alternative, not a footnote. A shipper who is past 18 months on an overcharge is not automatically out of options, because the statute contemplates a longer period for a complaint filed with the agency rather than an action in court. Whether that route makes practical sense for your dollar amount is a question for counsel, not for a blog post, but knowing the option exists changes how you triage an old file.

Extensions, and why they matter more to shippers

14705 also provides for extensions of the limitation period. The section allows a 6-month extension on written disallowance of a claim, plus 90 days where the carrier begins a collection action. Those are compressed descriptions of provisions with real conditions attached, so read the subsection against your own facts before you rely on either one.

The practical shape is this: filing a claim and getting it formally disallowed in writing does not instantly end your rights, and a carrier that sues to collect can extend the window in which counterclaims live. Both of those tend to favor the party who kept written records and dated correspondence, which is most of what determines who wins a limitations argument in the first place.

Do not treat an extension as a plan. Treat it as a backstop. If your process depends on an extension to preserve a claim, the process is the problem.

The 18-month clock is not the deadline you will actually hit

Here is the part worth internalizing, because it changes how you run a freight AP desk.

The 18-month period is a limitations period on suing. Long before it matters, two 180-day windows in 49 U.S.C. 13710 have already run: the carrier must bill charges additional to those it originally billed within 180 days of your receipt of the original bill to preserve its collection rights, and you must contest a bill within 180 days of receipt to preserve your right to challenge it.

Stack them and the sequence looks like this for a typical truckload delivered on day zero:

• Day 0. Delivery. The 18-month accrual clock starts.
• Roughly day 7. The carrier presents its freight bill. Under 49 CFR 377.205, a carrier must present its bill within 7 days of receiving the shipment on prepaid moves or 7 days from delivery on collect moves, and the bill must state the credit time limit, the late-payment penalty, any service or collection charge, and discount terms.
• Roughly day 22 to day 37. Payment is due. Under 49 CFR 377.203, the standard credit period is 15 days beginning the day after presentation of the freight bill, extendable by published tariff to no more than 30 calendar days.
• Around day 127. The carrier’s window to issue a revised freight bill carrying late-payment or collection charges closes. 377.203 permits those charges only if the carrier issues a revised freight bill within 90 days after the authorized credit period expires.
• Around day 187. Both 180-day windows in 13710 have closed, measured from your receipt of the original bill.
• Day 547. The 18-month limitations period ends.

The gap between day 187 and day 547 is the point. For most of the life of a freight charge, the parties’ rights are already fixed by the earlier windows, and the limitations period is only about whether a preserved right can still be enforced in court. A shipper who thinks “we have 18 months to sort this out” has usually already lost the contest window. The full set of these clocks, with the rule behind each one, is laid out in every freight billing deadline that can cost you money.

Loss and damage runs on a different schedule entirely

This is the single most common mix-up in freight compliance, and it costs claims.

Money disputes about what a shipment cost run under 14705. Disputes about freight that arrived short, late or broken run under Carmack, at 49 U.S.C. 14706. Section 14706(e)(1) bars a carrier from imposing a claim-filing period shorter than 9 months, or a period for bringing suit shorter than 2 years, with the 2 years running from the carrier’s written notice of disallowance.

Note the structure carefully, because it is not the same kind of rule. 14705 sets limitation periods. 14706(e) sets floors on what a carrier may impose by contract or tariff. A carrier’s bill of lading can say 9 months and 2 years. It cannot say 6 months and 1 year. Your actual deadline is whatever your governing document says, and that document is where you look first.

The two systems also have separate administrative clocks. Under 49 CFR 370.5, a carrier must acknowledge a claim in writing within 30 days of receipt unless it has already paid or declined it in writing, and must record the receipt date and assign a claim file number. Under 49 CFR 370.9, it must pay, decline, or make a firm written compromise offer within 120 days, with a written status report at 120 days and every 60 days after that. On the billing side, the equivalent duty is 49 CFR 378.8: the processing carrier must pay, decline or settle a written overcharge claim within 60 days of receipt absent a written agreement to extend, and under 378.9 a carrier that discovers a duplicate payment owes the refund within 30 days.

If a file has both problems, and plenty do, run them as two files. The evidence overlaps, the deadlines do not, and merging them is how a claim ends up filed against the wrong clock.

What “unpaid freight charges” includes, and who owes them

A collection action is not limited to a shipper who never paid. Three situations account for most of the ones that reach an actual demand letter.

Short-pays that were never resolved. You disputed a line, paid the rest, and the carrier never accepted the deduction. The unpaid balance ages quietly for a year and then appears in a collections file. This is why a short-pay is only safe when it is documented as a dispute, in writing, at the time, with the carrier’s response tracked.

Balance-due rebills. A supplemental invoice never paid. Whether it was ever collectible depends on the 180-day rule covered in balance-due invoices under 49 U.S.C. 13710, and that question is separate from whether the limitations period has run.

Charges billed to the wrong party. Consignee and agent-consignee billing produces the most confused collection files. Under 49 U.S.C. 13706, an agent-consignee that gives the carrier written notice of its agency status before delivery is liable only for the rates billed at delivery, with the beneficial owner liable for additional rates, and a consignee that misidentifies the beneficial owner stays liable. If you receive freight as an agent, that written notice before delivery is the whole protection. Give it every time, in writing, and keep the record.

Brokers and 3PLs sit in a harder position, because a carrier’s unpaid-charges claim and a shipper’s payment can both be live at once. Nothing in the limitations analysis changes that; it just means the file has to be clean on both sides.

Answering a stale collection demand

When a demand arrives on a load that delivered well over 18 months ago, resist the urge to argue the freight. Arguing the merits invites a debate about the merits. Lead with the date.

What to establish before you reply:

1. The delivery date, from the POD, not from your TMS status field. The signed delivery receipt is the document that fixes accrual.
2. The original invoice and its receipt date, so you can also see whether the amount now demanded is an additional charge that was already outside the 13710 window when it was billed.
3. Every prior communication on the load, dated. A written disallowance in the file may have extended a period, and you want to know that before the other side tells you.
4. What your contract says. Your transportation agreement or the rules tariff it incorporates may set its own dispute and notice terms. Contractual terms are where most freight disputes are actually decided, and a statute is the backstop, not the starting point.

Then reply in three sentences: the shipment delivered on a stated date, the demand was made more than 18 months after that date, and on that basis you decline it and consider the matter closed, subject to any documentation showing a different accrual date. Attach the POD.

One caution on tone. A carrier’s collections desk chasing an 18-month-old receivable is usually working a stale ledger, not running a scheme. Most billing disputes are process artifacts on both sides. A short, dated, documented decline gets these closed. A combative one gets them escalated.

What this means for your records policy

Every deadline in this post is enforceable only if you can produce a dated document. That has a direct consequence for retention: the outer clock on a routine domestic freight charge is 18 months from delivery, the agency route for an overcharge complaint reaches 3 years, and government shipments run 3 years in both directions. Keeping the shipment file for less time than the longest clock that can reach it means losing arguments you would otherwise win, which is why what freight billing records to keep and for how long is a compliance question rather than a storage question.

The documents that carry the weight are unglamorous: the signed POD with a delivery date, the original invoice with a captured receipt date, remittance advice, and dated dispute correspondence. Those four settle the overwhelming majority of limitations arguments.

The checklist

1. Find the delivery date on the signed POD. That is when the claim accrued.
2. Count to 18 months for a court action on freight charges or overcharges, in either direction.
3. Check whether the earlier windows already decided the question: the 180-day billing and contest windows under 13710, and the credit and revised-billing periods under 49 CFR 377.
4. Separate loss and damage from money disputes and run them as two files under two clocks.
5. Read your contract and the incorporated rules tariff before relying on a statutory period.
6. Document short-pays as written disputes at the time, so an aged receivable has a written history.
7. If you receive as an agent-consignee, give the carrier written notice of that status before delivery, every time.
8. Retain shipment files past the longest clock that can reach them, which for routine domestic freight means well beyond 18 months.

You will probably never sue anyone. Knowing the outer boundary still tells you which old invoices are live, which are closed, and which files you cannot afford to have thrown away.

Sources

• 49 U.S.C. 14705, limitation periods for freight charges, overcharges and damages (Cornell LII)
• 49 U.S.C. 14706, Carmack liability and minimum claim and suit periods (Cornell LII)
• 49 U.S.C. 13710, additional charges and the 180-day contest window (Cornell LII)
• 49 U.S.C. 13706, liability of consignees and agent-consignees (Cornell LII)
• 49 CFR 377.203, credit periods and revised freight bills (Cornell LII)
• 49 CFR 377.205, presentation of the freight bill and required terms (Cornell LII)
• 49 CFR 370.5, acknowledgment of a loss and damage claim (Cornell LII)
• 49 CFR 370.9, disposition of a claim within 120 days (Cornell LII)
• 49 CFR 378.8, sixty-day resolution of written overcharge claims (Cornell LII)