Barclay Damon
Barclay Damon

Legal Alert

Transportation in Review

Our Transportation Team has once again highlighted important cases in transportation law from 2016 with relevant cases and links to each decision.

You can begin to read below or click here to open the full newsletter.

1. The MCS-90 Endorsement and State Filings

The year’s crop of MCS-90 decisions, many from state courts, gives us the opportunity to review some basic principles relating to the scope of the federal filing. In Grange Indemnity Insurance Co. v. Burns, 337 Ga. App. 532, 788 S.E. 2d 138, the insurer issued a liability policy to J.B. Trucking, Inc., a local hauler, with limits of $350,000 and, for reasons unknown, an MCS-90 endorsement with the amount $350,000 typed in on the front side of the endorsement. The back of the endorsement, of course, sets out the three basic amounts of filing requirements for property carriers for-hire, $750,000, $1 million and $5 million. To be sure, insurers are allowed to “aggregate,” that is to team up to provide the required limits. Here, though, there was no compelling evidence that J.B. Trucking was an interstate carrier that required a federal filing and, in fact, no filing was made. The court offered no explanation for any of this, and we wonder whether the underwriters issued this MCS-90 in error.

The J.B. Trucking vehicle involved in the loss was being used in intrastate commerce, but plaintiff was looking for a recovery in excess of $350,000 and thought that the MCS-90 might offer an opportunity since the endorsement is generally issued in one of the higher amounts set out above. Plaintiff, who had sued both J.B. and Grange, argued that the MCS-90 applied and that its limits needed to be increased to $750,000. (In Georgia, the plaintiff may sue the defendant and insurer in the same lawsuit.) Prior to trial the court found that J.B. was an interstate carrier (although the finding is questionable), and ruled that the MCS-90 applied even in the context of an intrastate load. And, as if that weren’t enough, the court found that the MCS-90 should be increased to $750,000. The case then went to trial and judgment was entered against J.B. for over $2 million. (more)