U.S. Court of Appeals for the Ninth Circuit on Sept. 8 reversed injunctions granted by a federal district court against four separate motor carriers related to compliance with the federal truth-in-leasing regulations. The appeals court concluded that the plaintiffs lacked standing because (1) the regulatory violations for which they sought injunctive relief caused them no injury, and (2) the Interstate Commerce Commission Termination Act “would have an impermissible retroactive effect if it conferred standing to bring claims for damages on the basis of contracts executed before the ICCTA’s effective date.”
The Ninth Circuit ruled that a group of employees with monocular vision denied driving positions by UPS qualified as disabled under California’s Fair Employment and Housing Act. The decision does not necessarily mean, however, that UPS will be forced to grant these employees driving jobs. In the same opinion, the appeals court ruled that UPS had demonstrated that another group of drivers covered by FEHA would “endanger the health or safety of others to a greater extent than if an individual without a disability performed the job.”
National Private Truck Council and J.J. Keller & Associates recently presented a free webcast on how trucking operations can protect themselves from the risks associated with negligent hiring decisions. A free download of the presentation is available at this site.
The owner and two foremen of Nationwide Moving Systems, Woodinville, Va., were ordered by a federal court in Tacoma, Wash., to pay a total of $670,000 in restitution for their parts in a scheme to defraud Nationwide customers by providing low-ball moving estimates and then holding goods hostage until customers paid inflated prices.
Q We are a broker that hired a carrier to provide service for a contract shipper. The carrier had a multi-fatality wreck, and now a claim is being made by the family of the deceased against our shipper. The shipper has turned the claim over to us under a contract provision we signed agreeing to indemnify it against all claims “arising out of” the contract. We have a commercial general liability policy, and the motor carrier we hired has the required $1 million in third-party liability coverage. Are we in trouble?
A Most truck accident suits against shippers and brokers are dismissed or settled for the motor carrier’s policy limits because of the difficulty in proving shipper or broker liability. Hopefully, you are not in trouble, but your question poses several issues.
In the absence of their own negligence, shippers have remote exposure to lawsuits of this type, yet they favor broadly worded indemnity in contracts because they frequently are viewed as deep pockets and are named in lawsuits simply because their freight was on the truck. Shippers face the same suit risk and cost of defense regardless of whether the carrier involved in the wreck was retained by it or through you. There are enough runaway jury verdicts and bad case law out there to counsel the need for future prudence in this area of contract indemnification.
