SECTION NINE EXPOSURES TO LIABILITY

Transcription

1 SECTION NINE EXPOSURES TO LIABILITY

2 SHIPPERS DUTIES & EXPOSURE TO LAW SUITS PACKAGING- ACCURATE - SYMBOLS - P. 163 TERMS OF SALE - P. 163 ACCEPT DAMAGED GOODS - P. 164 MITIGATION OF LOSS- P. 164 INJURY/DEATH ACTIONS - P.165 DESCRIPTION PRODUCT LIABILITY ON SALVAGE (SHIPPERS / RECEIVERS) - P.165, 175 NEGLIGENT SELECTION OF CARRIER

3 CARRIERS DUTIES AND EXPOSURE TO SUITS INSPECTION OF LOADS - P. 169 LOADING & UNLOADING - P. 171 REASONABLE DISPATCH - P. 171 MITIGATION OF LOSS - P. 171 CHARGE LOWEST RATE - P. 172 EQUIPMENT LEASING REGULATIONS - P. 172 INJURY TO THIRD PARTIES - P. 173 PRODUCT LIABILITY-SALVAGE -P.175

4 DAMAGES FOR VIOLATING ANY PROVISION OF THE ACT 49 USC P. 176 (PLUS ATTORNEY FEES - (e)) APPLIES TO CARRIERS, FREIGHT FORWARDERS & BROKERS INTERLINING - P.176 DRIVERS REGULATIONS (HOURS OF SERVICE, ETC) - P. 176

5 NEGLIGENT SELECTION OF CARRIER SCHRAMM V. FOSTER PRINCIPAL APPLIES TO CARRIERS & SHIPPERS AS WELL AS BROKERS & INTERMEDIARIES

6 DEFINITION OF NEGLIGENCE The omission to do something which a reasonable man, guided by those ordinary considerations which ordinarily regulate human affairs, would do, or the doing of something which a reasonable and prudent man would not do. (Black s Law Dictionary, Fourth Edition)

7 LEGAL REQUIREMENTS TO PROVE NEGLIGENCE That defendant had a duty to plaintiff That defendant breached that duty That there was a casual connection between the breach & the injury That plaintiff suffered actual damages (Transportation, Logistics and the Law, Second Edition, Page 224)

8 NEGLIGENCE IN SELECTION OF CONTRACTOR An employer is subject to liability for physical harm to third persons caused by his failure to exercise reasonable care to employ a competent and careful contractor (a) to do work which will involve a risk of physical harm unless it is skillfully and carefully done...(restatement of the Law of Torts, 2nd Edition, 1965)

9 L.B. FOSTER V. HURNBLAD 9 th Cir. Court of Appeals, 1969 Held - Shipper liable to injured parties in highway accident Reasonable inquiry would have shown Carrier or broker s lack of experience Poor financial condition No ICC certificate Doing business at cut rates Implies carrier can not provide safe equipment No inquiries made

10 CGU V. KEYSTONE LINES U.S. District Court, California, 2004 Held- Broker not liable for accident resulting in damage to cargo Standard of care is ordinary prudent person Broker need only check carrier s license and insurance No Separate inquiry needed into driver history or accident record Ins. And License reflects on safety record Broker visited carrier s facilities

11 SCHRAMM V. FOSTER U.S. District Court, Maryland, 2004 Court denied request for Summary Judgment dismissing case BUT held case can go to trial on issue of negligent selection of carrier by broker. The involved broker was CH Robinson, one of the largest brokers in the United States. Court stated that a Broker can be liable for not using reasonable care in selecting carriers it uses

12 Court stated that it would not be unduly onerous to require to: 1) Check safety rating & stats at FMCSA 2) Maintain internal records to safeguard against carriers manipulations to avoid unsatisfactory SafeStat record 3) If no safety record then conduct investigation Carrier s SEA rating 74 vs. 75 max. and prior safety record should be warning! CHR subsequently settled

13 PUCKREIN V. ATI TRANSPORT Supreme Court, New Jersey, 2006 Shipper held to same standard as in Foster and Schramm Carrier s insurance had expired two months prior to the accident Shipper made no inquiry as to carrier s status Shipper did not follow its own procedures

14 BROKERS RESPONSE TO SCHRAMM V. FOSTER If Congress intended brokers to be liable, it would have required MCS-90 Ins. Brokers deal with thousands of carriers Time allowed does not allow Safestat check for every load Broker qualifies every carrier once/year

15 SOLUTION: Amend contracts Subscribe to carrier monitoring service Review internal qualifying procedures Strictly enforce those procedures!

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