$23.7 million liability case against
C.H. Robinson
Avalon offers SDDC Bond and Regulatory
Defense program for TIA members
Bill of lading requirements for
surface freight forwarders
Tips on how transportation brokers and
other companies that hire motor carriers can reduce their
liability exposure
CBP withdraws enhanced bonding
requirement for shrimp imports from India and Thailand
United States levies 10 percent import
tariffs on softwood lumber from four Canadian provinces
New FMCSA program expected to reduce
accidents
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$23.7 million
liability case against C.H. Robinson In
what has been reported as the largest award in a Will
County, Ill. civil case in at least 50 years, a jury awarded
$23.7 million in damages against transportation broker C.H.
Robinson Worldwide, after the company hired a motor carrier
involved in a dual-fatality truck accident.
The case, Sperl v. Henry et al. (04 L 428
consolidated), was the culmination of nearly five years of
litigation after an April 1, 2004 multiple vehicle accident
when DeAnn Henry, the driver of a tractor trailer, lost
control of the truck and rear-ended multiple vehicles. The
collisions caused the deaths of two individuals and serious
injuries to another.
The plaintiffs pursued a lawsuit against Henry and the
now-defunct motor carrier, Toad L
Dragonfly, both of whom admitted liability, but had
limited coverage. C.H. Robinson was also named in the
lawsuit, but the company contested liability for the
accident, claiming Henry was an independent contractor.
Local newspaper accounts said Henry of Kanab, Utah, operated
the truck on a suspended license and falsified her
hours-of-service logbook. In 2005, she pled guilty to the
logbook charge, as well as following another vehicle too
closely.
The case has raised concerns about the potential liability
that transportation brokers and other transportation
providers (surface freight forwarders, air freight
forwarders, NVOCCs, customs brokers, etc.) could face when
the motor carriers that they hire are involved in accidents.
C.H. Robinson argued that it should not be held liable, as
it had merely booked the load with Dragonfly Express, the
motor carrier that hired Henry. It appears that the court
disagreed that the relationship was sufficiently “arms
length” in nature. C.H. Robinson was involved in a similar
case in 2004, Shramm v. Foster, which focused on the
company’s negligent selection of a motor carrier.
Ultimately, that case was settled out of court.
Transportation brokers like C.H. Robinson arrange for loads
to move, but the licensed motor carrier issues the bill of
lading and has primary liability for bodily injury and
third-party property damage as well as for loss of or damage
to freight. The current case (as well as several others)
have clearly demonstrated that a third-party logistics
provider or even a shipper (see Puckrein v. ATI Transport)
can have significant liability for the acts of motor
carriers that they hire.
Avalon provides multiple coverage options specialized for a
transportation broker’s unique insurance needs.
Contingent Auto Liability Insurance covers a
transportation broker’s legal liability on a contingent
basis for third-party property damage or bodily injury
(including death) caused by a for hire motor carrier.
Contingent Auto Liability coverage may be added to Avalon’s
Combined Transit Liability (CTL) program, which
combines Errors & Omissions Insurance with Contingent Cargo
Insurance and optional contractual coverage (for client
contracts). Cases such as the one above can take years to
resolve resulting in significant defense costs. The CTL
program provides coverage for defense costs and attorney
fees as well as the payment of judgments and settlement
amounts you are legally obligated to pay. |
