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Bits & Pieces

Volume 21, Edition 9

Good day CAB Nation!

My goodness, autumn has arrived and I couldn’t be more excited.  I always look forward to fall as it signifies cooling of the temperatures and the start of the vibrant fall colors.  However, this year is special for me as I’m roughly one month into my career at CAB as the Sr. Vice President.  Although my time has been short here, I have enjoyed getting to know my co-workers and many of our subscribers.  I’ve always known CAB was a customer driven company, but that has become even more evident for me in the last month.  Our team continues to develop our products to make them even more vital to our customer processes.

If you have thoughts or suggestions on how to improve our tools and resources, I encourage you to reach out to myself or one of our team members.  We will be happy to work with you.

Our goal with Bits n Pieces is to share with you relevant news and resources that will keep you informed and on top of what’s happening in the transportation risk world.

This month we report:

The week of September 9th was Truck Driver Appreciation Week.  The American Trucking Association celebrated the first truck driver appreciation week back in 1998.  20 years later it has grown in momentum and popularity.  Although this year’s event has past, I’d encourage you and your organization to get involved at the local, state or national level to show appreciation for the men and women that deliver everything from fresh apples to zinc.  The dates for the 2019 National Truck Driver Appreciation Week are September 9-15th.

2018 Pocket Guide to Large Truck and Bus Statistics was released by the FMCSA the first week of September.  The pocket guide is an annual release that details inspections/investigations and general trucking statistics.  The data compiled is from 2017.  Last year, 3.5 million inspections were conducted, an increase of more than 50,000 from the previous year, but a reduction from the recent high of 56,000 in 2013.  Interesting to note, more than 86% of interstate freight carriers had no safety rating.  Roughly 10% had a “satisfactory” rating, 3.5 percent had a “conditional” rating and less than one percent had an “unsatisfactory” rating.  You can access the guide by clicking this link.  2018 Pocket Guide to Large Truck and Bus Statistics

Drivers with properly managed Diabetes no longer prohibited from operating Commercial Motor Vehicles (CMV) interstate.  Prior to this ruling, drivers with Insulin-Treated Diabetes Mellitus (ITDM) were prohibited from operating by the FMCSA unless they were able to obtain a waiver.  Under the new ruling, a Certified Medical Examiner (CME) can grant an individual with ITMD a medical examiners certificate from up to 12 months.  The treating provider that prescribes the insulin must provide the ITDM assessment for to the CME indicating a stable insulin regimen and control of the disease.

Bridgestone and the National Highway Transportation Safety Administration (NHTSA) has recalled roughly truck 2700 tires due to exposed steel cords resulting in rapid air loss that can increase the risk of a crash.  The two entities have established a plan to replace the tires.  For more information go to WWW.safercar.gov and search Campaign Number 18T011000.

HOS Commend Period Extended.  The FMCSA has extended the comment period for its advanced notice of proposed rulemaking for potential changes to the hours-of-service rules.  A number of national transportation and safety organizations including the American Trucking Association and the Commercial Vehicle Safety Alliance requested the extension.  Comments can be submitted via the Federal eRulemaking Portal and listening sessions.  The four areas of the HOS rules the FMCSA is considering changes to are:

-Expanding the current 100 air-mile short-haul exemption from 12 hours on duty to 14 hours on duty, to be consistent with the rules for long-haul truck drivers;

-Extending the current 14-hour on-duty limitation by up to two hours when a truck driver encounters adverse driving conditions;

-Revising the current mandatory 30-minute break for truck drivers who drive after the 8th hour of their workday; and

-Reinstating the option for splitting up the required 10-hour off-duty rest break for drivers operating trucks equipped with a sleeper berth.

The updated release and additional information can be found here.

CVSA reported on September 12 that the International Roadcheck 2018 out-of-service rates drop from 2017.  CVSA reported that there was a 1.4% decrease in the Out-of-Service rate for Level 1 inspections.  Similarly there was a .08% decrease in all drivers placed out-of-service for all Level I, II & III inspections.  The top out-of-service violation for vehicles was brake systems and Hours of Service for Drivers.  The three-day safety blitz was conducted from June 5-7, 2018.  During this time 67,502 inspections took place.

Cases

Cargo

The Eighth Circuit reversed the district court’s order finding that a claim under the Carmack Amendment against a rail carrier was untimely. While there was a nine month claim requirement the Court held that the plaintiff has complied in a timely manner. The Court held that there was a question of fact on whether a related party who was presenting a claim was subject to contractual terms that it was not privy to. Whatley v. Canadian Pacific Railway Limited, 2018 WL 4374897

Can a motor carrier be brought back into a cargo claim through a third party action by a joint tortfeasor? The Middle District of Pennsylvania held that they could be brought back in, denying summary judgment to the motor carrier and concluding that the claim for indemnity and contribution was not barred by the Carmack Amendment. Helvetia Swiss Ins. Co. v. Jones, 2018 U.S. Dist. LEXIS 160079.

A truck broker was partially successful in avoiding a motion to dismiss its claims against a motor carrier for non-delivery of a series of shipments. The Northern District of Illinois held that the broker sufficiently alleged that it was assigned the rights of the customer. The court held that the only claim was one which was subject to the Carmack Amendment and dismissed all other claims as preempted, including a claim for attorney’s fees and punitive damages. Coyote Logistics v. MPJ Trucking, 2018 WL 4144628

Over in the Western District of Pennsylvania a broker was permitted to assert a claim against the carrier for lost profits when the customer did not pay after a transit loss. It was not permitted to sue for anticipated damages which might occur if the customer sued the broker. The Court also held that the broker was not a third party beneficiary of the shipper’s cargo policy and could not assert a claim under that policy. Pittsburgh Logistics Systems,  Inc. v. Landstar Ranger, Inc. 2018 WL 4096282

A cargo claimant was awarded prejudgment interest when recovering on a cargo claim in the District of New Jersey. While the court awarded the judgment it refused plaintiff’s demand for a higher interest rate, noting that the fluctuating interest rate during the prejudgment period was a more appropriate option. Tryg Insurance Co. v. C.H. Robinson, 2018 WL 4146601

The Court did not fully dismiss a motor carrier’s efforts to seek a declaration as to the extent of its liability for a cargo loss. The Southern District of Florida held that plaintiff was not required to include other entities in the transportation line for the action to proceed, but did hold that the motor carrier had filed a “shotgun” complaint and needed to amend the complaint to more adequately address the facts in order to proceed with the case. Central Transport v. Global Aeroleasing, Inc., 2018 WL 4268887

When a truck is damaged while being transported by a tow company the Carmack Amendment does not apply to the claim. The 6th Circuit held that the emergency towing of an accidentally wrecked or disabled vehicle was exempt from federal jurisdiction and therefore the Carmack Amendment did not apply. Acuity Insurance Co. v. McDonald’s Towing and Rescue, 2018 WL 4096094

Preemption ruled the day in the District Court in West Virginia. The court dismissed the plaintiff’s state law claims arising from a claim for damage to household goods. Dzingeleski v. Allied Van Lines, 2018 WL 4224450.

The same did not hold true however when the plaintiff sought compensation for damages which occurred either during or in anticipation of transit or during long term storage. The Eastern District of West Virginia held that while a claim for transit damage was subject to the Carmack Amendment, the same did not hold true to a claim that damage occurred during long term storage. Nachman v. Seaford Transfer, 2018 WL 4186397

Physical Damage

Invoking the appraisal process on a pd claim will not necessarily preclude a claim for bad faith. The Court of Appeals in Colorado held that while the appraisal process was enforceable and results in a binding determination of the value of the tractor is did not resolve the insurance company’s liability for breach of contract or statutory bad faith. The case was remanded for reinstatement of the complaint for bad faith. Andres Trucking Co. v. United Fire & Cas. Co., 2018 Colo. App LEXIS 1327.

Auto

The Supreme Court of Oklahoma held that a motor carrier’s liability for negligent entrustment of a vehicle to an unfit employee was a cause of action which was separate from a claim of respondeat superior. Even when the motor carrier concedes vicarious liability for the actions of the driver the claim of negligent entrustment was not barred. Fox v. Mize, 2018 WL 441782

The District Court in Illinois upheld a denial of a motor carrier’s request for summary judgment. The motor carrier sought dismissal of the claim that it ratified the actions of the driver in falsifying records. As there remained the potential for a jury to find that the motor carrier deliberately chose to ignore the actions of the driver summary judgment was inappropriate. Langan v. Rasmussen, 2018 WL 4148842

A plaintiff in the Southern District in West Virginia was not permitted to collect under an MCS-90 issued on behalf of a trucking company when the transport involved was intra-state. The court also held that as the plaintiff recovered more than the financial responsibility from another insurer for the motor carrier no MCS-90 payment would be permitted. Finally the court noted that the plaintiff would be obligated to indemnify the insurer for any payment it might have paid because the plaintiff had agreed to indemnify the motor carrier when it settled the loss. As the motor carrier was obligated to indemnify an insurer who makes an MCS-90 payment, the circle of indemnity would require the plaintiff to pay back any money it might receive. Lyles v. FTL, Inc. 2018 WL 4343415

Simply because the motor carrier has a designated agent for service of process, as per the requirements of the BOC-3 filing, the motor carrier will not be subject to jurisdiction in a venue with no connection to the accident. The District of Vermont transferred a personal injury action arising out of truck accident in another venue where there was no other evidence of contact with the state of Vermont by the motor carrier. Hegemann v. M&M Am, 2018 U.S. Dist LEXIS 160683

Claims for negligent entrustment, punitive damages and attorney’s fees were dismissed against a motor carrier and a leasing company in the Southern District of Ohio. The court also held that there was no such thing as negligent leasing or loss of consortium for a fiancé, dismissing those causes of action. Moran v. Ruan Logistics, 2018 U.S. Dist. LEXIS 159648

Watch that statute of limitation. The District Court in Connecticut held that the filing of a complaint by UPS against a second trucking company for a personal injury accident was time barred. Although counsel tried to get the suit in under the gun they were unsuccessful. However they were not barred from asserting counter-claims in a second suit as the applicable Connecticut statute of limitation was not applicable to counter-claims – saved by the bell. Boahen v. Trifiletti, 2018 U.S. Dist. LEXIS 160276

Admitting liability for a truck accident will not allow a motor carrier to seek a ruling that the plaintiff and witness cannot testify as to the facts of the accident and the apparent speed of the driver. And while the plaintiff and the witnesses cannot reach a conclusion about the medical condition of the plaintiff they can testify as to the symptoms. Bishop v. Anderson, 2018 U.S.Dist. LEXIS 159636

Over in the District Court in Connecticut the court held that the MCS-90 endorsement did apply to an intra-state transport as the Connecticut legislation expanded its applicability to intra-state transport. The court also held that the insurer was not entitled to summary judgment that the hired cargo coverage would not provide coverage when the insured hired the car from a related company, or that various provisions of the policy precluded coverage or that it had no committed bad faith in failing to address the claim or provide a defense to the motor carriers. Veilleux v. Progressive Northwestern Insurance Co. 2018 WL 4374073

Bad faith was not an option for one plaintiff in the Northern District of Illinois. While the court concluded that the motor carrier’s insurer was obligated to defend and indemnify the shipper for injuries which occurred during the loading process, its actions were not in bad faith. The court concluded that the shipper was using the motor carrier’s tractor, a requirement to trigger the motor carrier’s policy. National Casualty Co v. South Shore Iron Works,2018 WL 4469017

When a trucking company drove onto and damaged a high school’s track it was liable only to substantially restore the track to its precondition. The District Court in Connecticut held that the school was not entitled to a complete make over. Borough of Naugatuck v. Knight Transportation, 2018 WL 3431160.

The Supreme Court in Alabama held that an injured driver who failed to exercise due diligence in determining who else should be named in a suit was barred from seeking to relate his amendment back to the original complaint to add additional parties. The court denied the request for a writ of mandamus. Ex Parte American Sweeping, Inc. 2018 WL 4177528.

A township seeking recovery for attorney’s fees as part of its tort claim against a trucking for damaging a historic bridge was thwarted in the Middle District of Pennsylvania. The court accepted that the American Rule, which precludes recovery of attorney’s fees, should be applied as the plaintiff had failed to support any reason why the rule should not be applicable. South Middleton Township v. Amerifreight Systems, 2018 WL 4207765

Even though a plaintiff filed a suit alleging that it was a citizen of Texas he was permitted to allege it was a citizen of Mexico in a second suit. As the plaintiff and the motor carrier were both Mexican citizens the case was remanded by the Southern District of Texas back to state court for adjudication. Pina-Martinez v. Saldana, 2018 WL 4140683.

A trucker was granted partial summary judgment in a suit in the Northern District of New York arising from a truck accident. The Court held that plaintiff’s miscarriage after the accident was not caused by the accident and that her other child suffered no serious injury or zone of injury in the accident. As there was a question of whether plaintiff suffered PTSD as a result of the accident the court allowed that issue to proceed. Fang v. Dofar, 2018 WL 4054096.

How do you apply the limits afforded by a guaranty fund? The Supreme Court of South Carolina concluded that when the defendant trucking company’s insurer went insolvent the $300,000 guarantee cap would apply to the full amount of the damages and that any settlement amount by other insurers is offset against the full amount and not the $300,000 cap. Buchanan v. South Carolina Property & Casualty Insurance Guaranty Assoc. 2018 WL 4212101

When a plaintiff was injured by a truck which was moving in reverse the jury determined that it was the spotters who bore the brunt of the loss. The Court of Appeals in Texas held that the consignee, who was supposed to be controlling the actions of the driver and/or warning him of the presence of other parties, bore 64% of the liability for the truck accident. Primoris Energy Services v. Myers, 2018 WL 4136186

The Court of Appeals held that a lessor of a truck bore no liability for the actions of the driver and the motor carrier. The Court concluded that retaining the right to inspect the vehicle during the term of the lease did not create a duty to the driver unless there was evidence that the lessor knew of the dangerous condition. Hernandez v. Grando’s LLC, 2018 WL 4233790

Failure to comply with Pennsylvania’s rules regarding notice of cancellation was fatal for an insurer seeking to deny coverage for a truck accident. The Middle District in Pennsylvania refused to reconsider its decision that the failure to specifically note the reason for cancellation on the notice precluded the cancellation, even when the evidence showed that the motor carrier was aware of the reason. Sunday v. Berkshire Hathaway Homestate Insurance Company, 2018 WL 4509216

The failure to properly provide a privilege log in responding to discovery was determined to be a waiver of privilege. The insurer in a coverage case was required by the Eastern District of North Carolina to produce a complete copy of its claim file in the coverage suit. Progressive Southeastern Insurance Co. v. Arbormax Tree Service, LLC, 2018 WL 4431320

The court granted summary judgment to a motor carrier and its driver for the plaintiff’s claim of wantonness. The Northern District of Alabama held that there would be no claim for wantonness when the driver simply misjudged his operations and had an accident. Edmonds v. Courier Service, Inc. 2018 WL 4409300

Accepting liability under the theory of respondeat superior allowed a motor carrier to seek dismissal for a claim of negligent entrustment of the vehicle. The District Court in Maryland further held that plaintiff had set forth no facts to support such a claim, even if it existed. Brown v. Kahl,2018 WL 4108030

The effort of a pilot car company to seek a defense and indemnity under the motor carrier’s policy failed in the Western District of Washington. The court held that there was no conceivable allegation under the complaint which would support that the pilot car was an additional insured under the motor carrier’s policy. DeTray v. AIG Insurance Company of Canada, 2018 WL 4184334

Thanks for joining us,

Jean & Chad

© 2018 Central Analysis Bureau