Justia Transportation Law Opinion Summaries

Illinois requires that motor carriers of property, conducting intrastate operations, obtain a license from the Illinois Commerce Commission, which requires appropriate insurance or surety coverage. A carrier complies by submitting proof of insurance or bond coverage and is then issued a public carrier certificate, stating that the holder “certifies to the Commission that it will perform transportation activities only with the lawful amount of liability insurance in accordance with 92 Ill. Admin. Code 1425.” Drivers must have a copy of the license with them at all times. It is a Class C misdemeanor offense for an operator not to produce proof of registration upon request. Three carriers were cited by the ICC police for conducting regulated activity without a license. During a follow-up investigation, the carriers refused to comply, reasoning that documents sought by the ICC would reveal their rates, routes, and services, so the requirement was preempted by the Federal Aviation Administration Authorization Act, 49 U.S.C. 14501(c). The ICC rejected the argument. The Seventh Circuit affirmed summary judgment in favor of the ICC, concluding that the document requests had no significant economic impact on rates, routes or services and, alternatively, that efforts to enforce the licensing requirement are exempted from preemption. View "Nationwide Freight Sys., Inc. v. Ill. Commerce Comm'n" on Justia Law

In 2007, while operating a truck, Yelder, an employee of Yelder-N-Son Trucking, collided with a Tri-National truck, causing extensive property damage. Tri-National filed a claim with its insurer, Harco, which paid $91,100 and retained a subrogation interest. Yelder was insured by Canal with an MCS-90 endorsement, mandated by the Motor Carrier Act of 1980, 94 Stat. 793. In 2010, Canal sought a declaratory judgment against the Yelder defendants and Harco. An Alabama court entered default judgment against the Yelder defendants only, stating Canal had no duty to defend or indemnify them under the Canal policy. The court made no declaration about whether the MCS-90 endorsement requires a tortfeasor’s insurer to compensate an injured party when the injured party has already been compensated by its own insurer. Tri-National then sued the Yelders in Missouri and obtained a $91,100 default judgment. Tri-National sought equitable garnishment against Canal, apparently on behalf of Harco. Canal removed the action to the federal district court, which granted Tri-National’s motion. The Eighth Circuit affirmed, holding that the MCS-90 does require such compensation. The circumstance of Tri-National carrying its own insurance did not absolve Canal of its obligations under the endorsement View "Tri-National, Inc. v. Canal Ins. Co." on Justia Law

Bennett was walking her dog in Garfield Heights, Ohio when she was struck on the left knee by a vehicle driven by Pastel. The accident threw Bennett onto the car’s hood. Bennett sued Pastel’s insurer, State Farm, which characterized as “ridiculous” her assertion that she was an “occupant” of the car, as that term is defined by State Farm’s policy, at the time she was on the vehicle’s hood. The district court granted summary judgment to State Farm. The Sixth Circuit reversed. The policy defines “occupying” as “in, on, entering or alighting from.” The court stated that “we have no reason to explore Bennett’s relationship with the car… the policy marks out its zone of coverage in primary colors.” View "Bennett v. State Farm Mut. Auto. Ins." on Justia Law

In the early morning hours of April 11, 2008, Jeremy Rustad and Heidi Hanna were killed in a plane crash in McLean County. Rustad was piloting his Cessna aircraft and Hanna was a passenger when the plane crashed. The National Transportation Safety Board determined the probable causes of the accident were due to pilot error and pilot impairment due to alcohol. The estate published a notice to creditors of Rustad for three successive weeks beginning May 22, 2008, informing them they had three months to file claims. On September 24, 2008, Olson, as "co-personal representative of the estate of Heidi Hanna, deceased, caretaker of [B.H.], a minor, and temporary guardian of [B.H.], a minor," filed a claim against the estate asserting the estate was indebted to Hanna's estate and to Hanna's children. The estate "disallowed" Olson's claim. In early 2009, Olson filed this wrongful death and survival action against the estate. The estate moved for summary judgment dismissing the action. The estate argued Olson's claims were barred because she did not serve the personal representative in that capacity and the failure to present her claims in the probate action made them res judicata. The estate also argued Olson could not show Hanna was injured before Rustad died, and therefore, both the wrongful death and survivor claims were barred under the nonclaim provisions of the Probate Code. The district court rejected the estate's arguments that service of process was insufficient and that the action was barred by res judicata. The court concluded Olson presented no evidence to show Hanna died before Rustad, and dismissed the wrongful death and survival actions because they were barred by the nonclaim provisions of the Probate Code. The district court further noted Rustad had an aircraft insurance policy and the nonclaim provisions did not prevent Olson from recovering to the extent of insurance coverage available for the accident. The court ruled the language in the insurance policy unambiguously limited coverage under the circumstances to $103,000, and a judgment was entered in favor of Olson for $103,000. The Estate appealed; the Supreme Court, after review of the trial court record, affirmed. View "Olson v. Estate of Rustad" on Justia Law

TAMS, a medical device manufacturer, hired Comtrans to coordinate shipment of equipment to a trade show in Chicago. Comtrans is not a carrier. It used its affiliate, ACS, which retained Atlas to perform the actual shipment. The Atlas truck was involved in a serious accident, leaving TAMS with more than $1 million in losses. TAMS’s insurance company sued on behalf of TAMS. Atlas is an interstate motor carrier authorized by the Federal Motor Carrier Safety Administration to transport goods in interstate commerce. Claims are subject to the Carmack Amendment, 49 U.S.C. 14706, which provides that a carrier of property in interstate commerce is liable for the actual loss or injury to the property caused b” the carrier, which may be limited “to a value established by written or electronic declaration of the shipper or by written agreement between the carrier and shipper if that value would be reasonable under the circumstances.” Atlas relied on the contract it had in place with ACS and the bill of lading delivered signed by a Comtrans warehouse manager when Atlas picked up TAMS’s shipment, as limiting liability to $0.60 per pound. The district court entered summary judgment for Atlas. The Seventh Circuit remanded for further development of the facts. View "Nipponkoa Ins. Co., L v. Atlas Van Lines, Inc." on Justia Law

Defendant performed occasional maintenance and repairs for a fleet of plaintiff's delivery trucks. Defendant usually provided service onsite at plaintiff's plant, but sometimes would take trucks to its shop. In 2007, defendant's employee caused a fatal traffic accident while driving plaintiff's tractor-trailer to defendant's shop for service. The district court concluded that under Illinois law only plaintiff's insurance policy provided coverage for the accident. The Seventh Circuit affirmed. Both insurers provide coverage: defendant's policy by its plain language and plaintiff's policy operation of Illinois public policy. Plaintiff and its insurer are, however, ultimately responsible for the settlement amount. Under Illinois law the vehicle owner's policy is primary over the operator's policy unless a statute provides otherwise. The Illinois tow-truck insurance statute does not apply to provide an exception. View "Coca Cola Ente., Inc. v. ATS Enter., Inc." on Justia Law

Plaintiff insured defendants. Defendant Schilli is a freight broker that arranges freight and provides risk management services for claims against other defendants, trucking companies, but does not own tractor-trailers or employ drivers. Plaintiff advanced funds to defend or settle claims against defendants for accidents that occurred during the duration of the policy. The policy had a coverage limit of $1,000,000 for each accident and a $100,000 basket deductible per occurrence and provides that "[y]ou agree to repay us up to this deductible amount for all damages caused by any one accident, as soon as we notify you of the judgment or settlement." Schilli's name and address are included in the definition of "you;" the other companies are named as insureds. Plaintiff sought reimbursement for amounts, up to the $100,000 deductible, that it advanced in defending and settling each case. Schilli refused to pay. In granting summary judgment in favor of plaintiff, the district court stated that the policy unambiguously defines "you" as all of the corporations. The Seventh Circuit reversed, finding the policy ambiguous as to the nature of defendants' liability for the deductible. View "St. Paul Fire & Marine Ins. Co. v. Schilli Transp. Serv., Inc." on Justia Law

Insureds, Minnesota residents, filed class action complaints against their automobile insurers alleging violations of a Minnesota statute, Minn. Stat. 65B.285, requiring insurers to provide a discount for cars which have antitheft devices and breach of contract claims based on the failure to apply the statutory discount. The court affirmed the district court's dismissal of the insureds' amended complaints, rejecting their attempts here, particularly in the absence of any indication that Minnesota's administrative remedies were inadequate, to circumvent Minnesota's administrative remedies in order to create a private right of action. View "Palmer, et al. v. Illinois Farmers Ins. Co.; Kluessendorf, et al. v. Progressive Preferred Ins. Co.; Hara, et al. v. USAA Casualty Ins. Co.; Johnson, et al. v. American Family Mutual Ins." on Justia Law

Airline insurance (USAUI) issued to Pace covered certain risks assumed by Pace in contractual arrangements with other companies, which generally consisted of charter programs. The policy referenced "legally obligated to pay as damages." Pace entered into a charter program contractual arrangement with Patriot, which entered into an agreement to transport L&M customers to destinations that L&M had booked for travelers. L&M purchased a required surety bond. In 2002, L&M claimed that Patriot had unlawfully refused to provide aircraft for scheduled flights, and Patriot contended that L&M not fulfilled payment obligations. Patriot terminated the agreement and, two months later, filed for bankruptcy under Chapter 11. L&M filed a proof of claim. The bankruptcy court disallowed the claim. In 2005, L&M filed suit, claiming coverage by policies, including the USAUI policy. The district court held that the policy did not provide coverage for a breach of contract claim. The First Circuit affirmed, finding no ambiguity in policy language. View "Lopez & Medina Corp. v. Piedmont Aviation" on Justia Law

The insured was driving his pickup truck when he was injured after swerving to avoid a cardboard box lying in the middle of his lane. Allstate stipulated that an unidentified vehicle dropped the box, but rejected a claim for uninsured motorist benefits and sought a declaratory judgment. The insured responded with counterclaims for breach of contract and insurance bad faith under 42 Pa. Cons. Stat.8371. The district court entered judgment for Allstate, finding that the injuries did not "arise out of ownership, maintenance or use of an uninsured auto." The Third Circuit reversed, rejecting an argument that the harm was caused by a box, not a vehicle. Physical contact with an uninsured vehicle is not required for an accident to "arise out of" the use of an uninsured vehicle. Accepting for purposes of appeal that an unidentified vehicle that dropped the box was an uninsured vehicle, there is a sufficient causal connection. The court noted that the insurance law is to be liberally construed in order to afford the greatest possible coverage to injured claimants. View "Allstate Prop. & Cas. v. Squire" on Justia Law