There are numerous citings proving the extreme importance of choosing a qualified carrier. In addition, making sure that the “qualified carrier” does not then broker the shipment out to another driver who may not be qualified falls under a freight broker’s responsibilities as well. As many of you are aware, fines can be astronomical and may result in loss of authority. Here are just a few of the cases that have been settled.
Heyl Logistics, Inc. was found guilty of negligence in a 2008 fatal accident. They had originally brokered to a driver by the name of Forrest Rangeloff. This trucker handed it off to a driver by the name of Daniel Clarey who had neither insurance nor operating authority. The jury found both Clarey and Heyl negligent, a more serious crime than vicarious liability, and awarded the plaintiff, the wife of the man killed, $1.68 million against Heyl. The driver received prison time and a fine of over $3 million.
In this 2016 case, the production company hired a trucking company directly, without the use of a freight broker. An accident resulted in an amputation and both the truck driver and shipping company faced a 1.5 million settlement. The amount was limited due to Tennessee’s Tort Reform law.
In 2015, Titan, a broker, contracted Southwind Transportation as a carrier of frozen poultry for O.K. Foods. Problems arose for Titan because they failed to let O.K. Foods know that they were a broker. When the shipment arrived at the wrong temperature, O.K. Foods obtained a judgment against both broker and shipper.
C.H. Robinson hired Toad L Dragonfly to deliver a shipment. An accident, caused by the truck driver, resulted in two deaths. The driver was found to have limited insurance coverage and to have lied in her logbook. In 2011, the court ruled against C.H. Robinson and awarded the plaintiffs almost $24 million in damages.
According to Mike H. Bassett, of The Basset Firm, “Under common law respondeat superior …only the motor carrier would be liable to the public for injuries sustained by their employee’s operation of the truck.” It appears that plaintiff attorneys are getting around this law by seeking damages due to negligent hiring or claiming vicarious liability. The judiciary seems more likely to sustain a claim in cases involving catastrophic damages.
In order to protect yourself from these types of claims, be sure to ask drivers for their certificates of insurance and MC or USDOT number (until FMCSA deems otherwise). Minimum insurance limits usually range from $1 million to $5 million. Excess limits should be carried as well. For those drivers that are offering low-ball quotes, consider having their safety rating checked. Transportation agreements should contain an indemnification from carrier to broker for any claim in which due diligence was not carried out when selecting driver.
As you can see from these case studies, choosing a qualified carrier is imperative. If you are a freight broker who wants to further protect their assets, consider checking out LOGISTIQ’s Broker Shield Insurance program. We can also provide you with a quick freight broker insurance quote to get you started.