Transportation Annual Year in Review: 2018
Barclay Damon’s transportation team again looks back at the past year’s important cases in transportation law. Our review of 2017 follows and includes links to decisions for the cases discussed.
1. Insurance Coverage Litigation
Always looking for additional deep pockets, plaintiffs’ lawyers sometimes look to the owners and insurers of trailers to contribute to judgments secured against the motor carriers that have possession of those trailers. Sentry Select Insurance Co. v. Lopez, 241 F. Supp. 3d 777 (W.D. Tex.) is among the latest in a series of decisions relating to trailer coverage, stemming from a one-vehicle accident that resulted in the death of the two men who had shared driving duties for the rig. The accident has led to many litigations, some of which we have described in past years. Goal Transports, insured by Sentry, had leased the trailer at issue and had hired Trans Front to move its freight on an ongoing basis between Texas and Mexico. At the end of the day, though, it was Moore Transportation, with drivers Munoz and Franceware, who were hauling the Goal trailer with cargo unrelated to Goal’s business and far from the international border. The two men were injured in a one-vehicle collision. Goal was unfamiliar with Moore and had not been in touch directly with Moore or the drivers. Could the Moore drivers, nonetheless, be deemed permissive users of the Goal trailer?
Sentry argued that Franceware and Munoz did not qualify as permissive users of the trailer. There was certainly no explicit permission, as Goal did not specifically authorize them to “use” the trailer—Goal did not even know they were going to be using its trailer. That left only the question of whether the men had implied permission to use the trailer. The evidence indicated that Goal, working through a transportation broker, had entrusted trailers over an extended period to Trans Front which operated between Texas and Mexico. Apparently, the arrangement did not include keeping a close record of where each trailer was because one of those trailers ended up attached to a Moore trailer en route to North Carolina. Goal did not explicitly authorize that use, but the claimants argued that it gave implied permission or, at least, there was a question of fact for the jury, since Goal did not keep close control over its trailers or specify that only Trans Front move them. Essentially, the argument was that Goal didn’t really care who used its trailers and that this was the same as implied permission. The court found that this did not qualify as implied permission, because there had been no communication of any kind between Goal and Moore or its drivers. In any event, Moore’s drivers were pulling the trailer hundreds of miles away from Goal’s routes, so even had there been implied permission, the drivers would have long since deviated from that permission, vitiating any coverage. This was a relatively easy call for the court. Often, though, trailer coverage is a much closer question.
- NYS Appellate Division Holds That SEC Disgorgement of Over $140 Million is an Uninsurable Penalty Under Professional Liability Policy
- NY Court Holds Claim Against Automobile Insurer Accrued on Date of Insurer’s Denial of Coverage
- NY Court of Appeals Enforces Additional Insured Clause Requiring Contractual Privity With the Named Insured