New Motor Carrier Form: What Language Should be Avoided in Agreements?

What language should I use or avoid in drafting owner-operator agreements, access agreements, shipper-carrier contracts, broker-carrier contracts, and equipment leases in order to maximize coverage under the New Form?

The New Form does not look at operating authority to determine who is an insured under the policy and the priority of coverage. Instead, it looks to the lease agreement between the parties. As a result, the owner-operator must be certain to have a written lease agreement with the motor carrier under whose authority they are operating and also make certain that the lease agreement does not require that the owner-operator hold the carrier harmless. If the lease agreement requires the owner-operator to hold the carrier harmless, or if there is no written lease agreement, then the owner-operator will be the primary for any loss.

New Motor Carrier Form: Does the New Form treat "other insurance" as primary or excess?

Answer:

a) The policy is primary for the named insured’s covered autos that another motor carrier hires or borrows if a written agreement between them requires that the named insured as lessor hold the motor carrier as lessee harmless. However, it is excess over any other collectible insurance if the written agreement does not have this requirement.

b) With respect to trailers, coverage is provided on the same primary or excess basis as the liability coverage provided for the power unit if it is a covered auto. However, it is excess if the power unit is not a covered auto.

c) Coverage is primary for any Trailer Interchange Coverage provided in the policy.

d) Except already noted, this policy provides primary insurance for any covered auto the named insured owns and excess insurance for any auto not owned by the named insured.

e) Under hired auto physical damage coverage, a covered auto the named insured leases, hires, rents, or borrows is considered an owned covered auto. The only exception is when such auto comes with a driver.

f) Coverage is always primary when liability is assumed in an insured contract, regardless to the above provisions.

g) The insurance company pays only its share when any other insurance covers the loss on the same basis, regardless of whether that coverage is on a primary or excess basis. Its share is the proportion that this limit of insurance bears to the total of all limits of all coverage forms and polices that apply on the same basis.

New Motor Carrier Coverage Form - Verbal Lease Agreement/ Other Insurance Primary?

Does a verbal lease agreement affect the scope of coverage?

Answer: Yes.

There must be a written agreement between the lessor of a covered auto and an insured for coverage to apply. If there is no written agreement, coverage will be disputed. For Hired Auto Physical Damage, expenses for which an insured becomes legally responsible to pay for loss of use of a vehicle rented or hired without a driver will be paid if there is a written rental contract.

 

Secret Recording: What Do You Do?

So what happens when there are secretly recorded audiotapes of an employer by an employee?

Although the employee may be able to make the recording, it MUST be produced before the witness is deposed. Pass on the following cases if you know someone facing this issue:

Walls v. Int'l Paper Co., 192 F.R.D. 294 (D. Kan. 2000):

A female plaintiff brought suit against her employer for alleged sexual discrimination and violation of the ADA. The plaintiff secretly tape recorded conversations between herself and her supervisor, and subsequently filed for a protective order to postpone production of recordings of conversations until after the deposition of her supervisor. Plaintiff alleged that the tapes are privileged work product that she prepared in anticipation of litigation. Subsequently, she admitted that they were not privileged because the statements were made by a named party, entitled to  production. The Court denied plaintiff’s protective order, and ordered plaintiff to produce the tape recorded statements at the time of the defendant’s deposition.

It should be noted the Court made a clear distinction in this case, that if an individual surreptitiously tapes a conversation with an unsuspecting partner, upon advise or direction from