In catastrophic truck crash cases, the negligent motor carrier often is a mom and pop carrier with few assets, and insurance with only the minimum limits required by the Federal Motor Carrier Safety Administration — $750,000.  These insurance limits will be woefully inadequate in such a case. The crash victim’s lawyer and the trucker’s lawyer share an interest in locating all potential defendants and sources of insurance coverage, and ensuring that they are in play and have a place at the table.

Answers to the following questions will help to identify all potential defendants:

  1. Who is the driver?
  2. Who is the motor carrier?
  3. Who is the broker/logistics company?
  4. Who is the driver’s employer?
  5. Who is the safety company?
  6. Who owns the tractor?
  7. Who owns the trailer?
  8. Who loaded the trailer?
  9. Who is responsible for maintenance?
  10. Who is the shipper?
  11. Who is the operations company? and
  12. Who planned the rig’s route?

In addition to the parties revealed by the answers to these questions, “statutory employers” of the driver are potential defendants. The Federal Motor Carrier Safety Regulations (FMCSR) make the driver the statutory employee of the motor carrier, regardless of whether the carrier nominally designates the driver as an independent contractor. The statutory employee doctrine arose out of the recognition that motor carriers were using independent contractor status to thwart the regulation of safety and the assignment of financial responsibility.

The FMCSR create the statutory employee doctrine by defining “employer” and “employee” broadly enough to turn truckers nominally designated as independent contractors into employees of certain parties, and by mandating that leases assign “exclusive possession, control and use” of the leased equipment to motor carrier lessees.

Sometimes, the party responsible as a “motor carrier” may not be the obvious party. For example, in Ten Hagen Excavating, Inc. v. Castro-Lopez (2016), the Dallas Court of Appeals found that an excavating contractor that hired independent truck drivers to haul loads was the statutory employer of the truck driver who caused a crash. The court reasoned that the excavator met the definition of a motor carrier because it was controlling the operation of the truck driver at the time of the crash.

A recent Texas Supreme Court case, Gonzalez v. Ramirez (2015), illustrates the interplay between Texas and Federal regulations affecting motor carriers and the prerequisite that a party be acting as a “motor carrier” before the statutory employee doctrine will apply in Texas.    Gonzalez contracted with 3R/Garcia Trucking to haul a grower’s silage to a feed yard. After one of Garcia’s trucks was involved in a triple fatality crash, the plaintiffs sued Gonzalez and alleged that he was operating as a motor carrier.

The Gonzalez court found that the leased equipment provision of the FMCSR did not apply to the crash because the trip at issue affected only intrastate commerce, and Texas has not adopted the leased equipment provision of the FMCSR. Although Texas has adopted the FMSCR’s definitions of “employer” and “employee,” the definitions apply only to “motor carriers,” as defined in the Texas Transportation Code. The Gonzalez court found that Gonzalez was not acting as a “motor carrier” under the Texas regulations because he had not “controlled, operated or directed” the truck’s operations.

A party’s control of the driver may be sufficient to create liability, regardless of whether the controlling party is found to be a motor carrier. For example, in Arvizu v. Estate of Puckett (2012), Puckett Auto Sales bought used cars and sold them at public auctions. After one of Puckett’s vehicles did not sell, Puckett instructed Montgomery County Auto Auction (MCAA) to deliver it to another auction house. The crash occurred while MCAA’s employee, Edward Cantu was in transit in the vehicle to the other auction house.

Even though Cantu was not Puckett’s employee, the Texas Supreme Court found that Puckett could be liable for Cantu’s negligence because MCAA worked for Puckett, and Puckett controlled the details of the mission. The court reasoned that Puckett was vicariously liable for a “sub-agency relationship” between Cantu and Puckett.

In addition to identifying all potential parties, it is important to investigate all possible sources of insurance coverage.   At a minimum, this includes: 1. coverage provided to the owner-operator of the tractor and trailer equipment, 2. coverage provided to the carrier that leases the tractor and trailer equipment, and 3. coverage provided for the equipment itself — the tractor and trailer equipment.              

The owner-operator’s insurance coverage generally is “bobtail,” or “non-trucking use” coverage.  “Bobtailing” is driving a tractor without an attached trailer. Generally, this coverage includes only non-trucking operations, and there is a “business use” exclusion for operations occurring while the equipment is being used to carry property for any business, or while the equipment is being used in the business of anyone to whom the auto is leased or rented.

The insurance policy most often directly in play in the crash is the policy providing coverage to the carrier. This policy usually is a commercial auto liability policy issued to the insured motor carrier, covering accidental losses arising out of the business of the motor carrier. Coverage disputes arising out of the carrier’s commercial auto policy are governed in the same manner as coverage disputes arising out of other automobile policies, with one very important difference — commercial trucking policies contain a mandatory MCS 90 endorsement that has the potential to dramatically change the policy’s coverage.

The Motor Carrier Safety Act of 1980 requires all interstate motor carriers to have a Motor Carrier Safety (MCS) 90 endorsement attached to their policies.  The MCS 90 endorsement protects the public by nullifying any attempt to reduce the statutory minimum coverage limits, notwithstanding coverage defenses and exclusions that might otherwise exist in the absence of the MCS 90 endorsement.  The MCS 90 endorsement can turn an excluded insured into a covered “insured,” and can turn an excluded vehicle into a “covered auto.”

In catastrophic truck crash cases, lawyers representing victims and lawyers representing truckers share the important goal of making sure that the table is properly set and that all necessary parties have a seat at that table.

Quentin Brogdon is a partner with Crain Lewis Brogdon, LLP in Dallas. He is the president of the Dallas Chapter of the American Board of Trial Advocates and a Fellow in the International Academy of Trial Lawyers. His email address is qbrogdon@crainlewis.com.