Trying to stay on top of cases involving truck brokers and other logistics operations is a tough daily task. We see submissions with settlement by insurance companies and we see court cases as well.
Our friends at the Central Analysis Bureau are probably the most diligent in keeping transportation insurance underwriters up to speed. While they report on all transportation cases and legal precedents nationwide, I found the following cases involving transportation brokers. So I will highlight the cases and what significance they have going forward.
Your takeaway should be that plaintiff attorneys are far more active in the transportation broker arena and in my view the loss cost is rising. This translates into a greater need for best practices.
Atiapo versus Goree Logistics- The issue here was a precedent changing event. A North Carolina court found a truck broker liable for a carrier’s failure to provide workers compensation coverage for a carrier he hired. The protocol here was that if the truck broker agrees that it will make sure a delivery is properly made by a carrier it hires, then the broker moves from an independent contractor to a general contractor. As a general contractor, the truck broker would be required to maintain workers compensation for the driver of the carrier. What is sad about this case is the Federal Preemption did not apply.
The upshot of this case is clear. Failure to hire carriers that require workers compensation coverage could and does expose the transportation broker to legal liability.
For the actual case summary, see the attached:
Montes versus El Paso- Los Angeles Limousine Service. The issue here was that a California District Court concluded that a plaintiff was entitled to remand their personal injury case against the broker to state court. Specifically the transportation broker could be sued for damages stemming from interstate commerce.
Defense counsel was relying on Federal preemption to shut down this case and it did not happen.
For the actual case summary, see the attached:
Borders versus Behrman- The issue here was that the insurance agent was held liable for lost revenues when the insurance agent told C. H. Robinson, the nation’s largest truck broker, that their insurance coverage had expired- in error. For those of you insurance agent’s involved in trucking companies and insurance filings, this case shows the exposure of what can happen when there is a failure to renew and communicate renewal coverage.
For the actual case summary, see the attached:
