Assessing per diem (detention) charges on days when a terminal is closed has long been deemed unreasonable by the motor carrier and cargo owner communities, and the US Circuit Court of Appeals in DC agrees.
A COVID-era complaint by a motor carrier was brought to the Federal Maritime Commission (FMC) for review and resolution. The complaint centered around the motor carrier receiving per diem charges over Memorial Day weekend when the terminal was closed.
The FMC ruled in favor of the motor carrier, and the ocean carrier appealed the FMC’s decision to the US Circuit Court of Appeals in DC. In July 2024, the court ruled in favor of the ocean carrier stating the FMC failed to provide a “fact bound” case for the unreasonableness of the charges and instructed the FMC to reconsider.
The FMC reviewed and, again, in February 2025, came to the same conclusion the per diem charges were unreasonable and violated the Interpretive Rule on Detention and Demurrage. And, again, the ocean carrier appealed the FMC’s decision to the US Circuit Court of Appeals in DC.
This time, however, the FMC proved the charges were unreasonable and did not “incentivize” the return of the empties as the terminal gates were closed. The Court sided with the FMC.