Court: Trucking Companies Attempt to Avoid Liability With Graves Amendment

The trucking industry is unique in the way it structures its operations. In many cases, the truck and trailer are separately owned, bound by a contract, which is sometimes arranged by a third party. Often, drivers are either independent contractors or farmed out through a driver agency. truckaccident

This kind of fragmentation has led to a great deal of difficulty in terms of securing liability judgments. In fact, appellate court justices in the 2010 case of Amerigas Propane, LC v. Landstar Ranger Inc. referred to these kind of arrangements as insulating the industry in a way that creates “often judgment-proof truck lessor operators.”

These protections were further bolstered with the passage of the Graves Amendment by federal legislators. The intent of the Graves Amendment was to protect companies in which the business model involved renting vehicles to third party customers. Think Avis, Hertz, Budget Rental – basically, the companies that rent cars to the public.

However, the trucking industry has seized upon the language of the amendment to wiggle out of liability when their driver, truck or trailer is involved in an injurious or fatal crash.

Some courts are showing reticence to apply this theory in such cases. For example, the Graves Amendment argument was flatly rejected in a 2014 fatal highway accident in New York state. In that case, a trucker watching pornography on his laptop barreled into a disabled vehicle, killing a woman. Her husband sued the driver, the driver’s employer, the owner of the tractor trailer and the parent company of both the employer and vehicle. The court ruled Graves could not be applied where the same company owned both the employer and the vehicle.

More recently, defendants in the case of Vargas v. FMI, Inc. attempted to use the Graves Amendment to secure summary judgment in an injury crash case, alleging it could not be held vicariously liable for injury caused by one independent contractor to another.

Court records show plaintiff was part of a two-man driving team, contracted to drive a tractor-trailer from California to New Jersey. A few hours into the trip, his driving partner fell asleep at the wheel, wrecking the rig. Plaintiff, who had been in the sleeper berth, was seriously injured.

He sued the driver, as well as the motor carrier/owner of the trailer and the tractor owner. Trial court granted summary judgment to defense, finding neither could be vicariously liable for driver’s alleged negligence, per the Graves Amendment.

California Court of Appeal for the Second Appellate District reversed.

On appeal, plaintiff asserted federal law requires that motor carriers must retain control of and be responsible for leased vehicles. The statute – 49 U.S.C. 14102 – is specifically in place to protect the public in cases where truck-leasing operators would seek to evade liability in the event of a serious truck accident.

Further, appellate justices found trial court erred in finding a hirer is never vicariously liable for the negligence of an independent contractor, particularly because the duty to provide a safe working environment is presumptively delegated in all independent contracts. Thus, summary judgment was reversed and the case remanded for trial.

This does not mean injured plaintiff has won his claim or that defendants will be unable to assert Graves Amendment protection. However, defense is not entitled to victory on these grounds as a matter of law.

If you have been injured in an accident, contact the Hollander Law Firm at 888-751-7777 for a free and confidential consultation. There is no fee unless we win.

Additional Resources:

Vargas v. FMI, Inc. , Jan. 23, 2015, California Court of Appeal, Second Appellate District, Division Three

More Blog Entries:

Ruiz v. Victory Props., LLC – Child Injury Case to Proceed, Jan. 27, 2015, Naples Truck Accident Lawyer Blog