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Freight broker not paying? What a Canadian carrier can do

Start with a written demand and clean paperwork. In Canada, a carrier can sometimes also go beyond the broker, including to the shipper or consignee (the receiver).

By Serhii Suhal, founder of CapeFrame
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Checked November 5, 2026. General information, not tax or legal advice.

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  1. Check that your paperwork is complete. Many "non-payments" are really a missing POD or a mismatch. Confirm that the broker has the invoice, the signed rate confirmation and the signed POD.
  2. Check what the terms say. The rate confirmation and your broker agreement set the due date and any conditions.
  3. Ask for a payment date in writing. Email the broker's accounts payable team, not just your dispatcher contact. Keep the replies.
  4. Send a formal demand. State the load number, the amount, the original due date and a final date to pay. Attach the documents.
  5. Stop hauling for them on credit. Don't let the debt grow while you wait.

Gather your evidence

Keep these together for each unpaid load:

  • signed rate confirmation
  • bill of lading and signed proof of delivery
  • invoice and proof that you sent it
  • every email and message about payment
  • the broker's legal name, not just its trade name, and its contact details

Who else may owe you

Your contract is usually with the broker, but Canadian law gives carriers some other options. An article by the law firm McCague Borlack describes three of them.

The consignee named on the bill of lading. The federal Bills of Lading Act covers a consignee named in a bill of lading. That consignee takes on the liabilities of the contract, as if it were a party to it. Ontario's Mercantile Law Amendment Act has nearly identical wording. So a carrier may be able to go after a named consignee, even without a direct contract.

A shipper or consignee that paid the broker. In Canadian Pacific Ships v Industries Lyon Corduroys, a consignee paid a load broker. The broker went bankrupt without passing the money on, and the Federal Court ordered the consignee to pay the carrier. To avoid paying twice, a party that pays a middleman has to show one of these:

  • the carrier authorized the middleman to receive the money
  • the carrier presented it as authorized
  • the carrier's conduct led the party to believe it was authorized
  • normal practice in the trade means both sides would expect payment through the middleman

Courts in Ontario, Alberta and British Columbia have used the same reasoning.

Money held in trust. Section 191.0.1(3) of Ontario's Highway Traffic Act covers a person who arranges carriage. Money they receive from the consignor (shipper) or consignee for the operator must stay in a trust account until it's paid. Legal writers say day-to-day enforcement is weak. But the trust duty has been used in court, including against the officers and directors of a load broker. It helps less once a broker is insolvent, which means it can't pay its debts.

Where to bring a claim

For a smaller debt, the usual route is small claims court in your province. Limits and procedures vary by province, so check yours. For larger amounts, or when a broker is insolvent, talk to a transportation lawyer early. Deadlines matter, and so does who gets paid first.

A broker registered in the US must have a US$75,000 surety bond or trust fund under FMCSA rules. You can look at claiming on it. All claimants share the amount, so don't wait.

Protect yourself on the next load

  • Check the broker before the first load. Look for its legal name, how long it's been in business, and credit references from a credit service or your factor.
  • Keep the rate confirmation specific. It should state the amount, currency, terms and the company's legal name.
  • Set a credit limit for each broker, especially a new one.
  • Invoice the day you get the POD, so the terms start right away.
  • Consider factoring for risky accounts. With non-recourse factoring, the factor takes on certain credit risks. Read what's covered, because disputes usually aren't.

This guide is general information, not legal advice. For a real claim, talk to a lawyer in your province.

Sources

This guide doesn't replace the law or professional advice, and rules change. Check the sources above before you rely on it.

Questions

Can I collect from the shipper if the broker didn't pay me?

Possibly. Canadian courts have made a shipper or consignee that paid a broker pay the carrier again. The exception is when it can show that the carrier authorized the broker to collect, or it has a similar defence. It depends on the facts and the documents, so ask a lawyer.

Do load brokers have to hold my money in trust?

In Ontario, yes. Section 191.0.1(3) of the Highway Traffic Act covers a person who arranges carriage. Money they receive from the consignor (shipper) or consignee (receiver) for the operator must be held in a trust account. Legal writers say Ontario is the only province with this rule.

Can I claim on a broker's bond?

A broker registered in the US must have a US$75,000 surety bond or trust fund under FMCSA rules. All claimants share it, and it may not cover your whole debt. We didn't find a similar requirement for brokers in Canada.

Should I contact the shipper directly?

Read your broker agreement first, because many have clauses against contacting the shipper. Get advice before you do it.

Stop retyping rate cons.

Forward a rate confirmation and get the invoice draft, with the tax suggested from the route. You approve every amount.

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How to invoice a broker

What goes on the invoice, which documents to send, and the mismatches that delay payment.

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What is a rate confirmation

What a rate con looks like, how it differs from a bill of lading, and what to check before you sign.

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Bill of lading requirements

What Ontario, Quebec, Alberta, BC and Manitoba require, and which province's rules apply.

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