Do the Federal Motor Carrier Safety Regulations Apply to this Defendant

Anthony v. One Sun Farms, LLC, N.J. Super. App. Div. January 2019

Submitted by New Jersey Truck Crash Lawyer, Jeffrey Hark

Facts:

South State is in the business of highway construction with its principle place of business in Cumberland County, New Jersey.  The company in in the business of  paving roads, and asphalt and sand production. It is registered with the United States Department of Transportation (DOT) because it owns and operates commercial vehicles incidental to its business operation. South State has a registration number with the DOT but not an interstate “operating authority” number because it is not a for-hire carrier in the business of transporting other companies’ cargo. It is owned in part by Chester Ottinger, Jr. and in part by the Ottinger Family Trust. Seashore is owned by Ottinger’s wife, Mary Lou Ottinger. It is in the business of producing and delivering asphalt and supplying trucking services. During the relevant period, Seashore frequently provided trucks to South State for use in construction jobs.

At the time of the tragic accident on November 4, 2013, South State required certain portable concrete highway barriers, stored at a site near another project, in order to complete the construction of an exit ramp off the Garden State Parkway. A South State employee contacted Seashore, requesting vehicles for hauling the barriers. As Seashore did not have enough trucks available for the job, Seashore contacted One Sun. One Sun, a nursery business owned by Newton B. Shimp III, owns several trucks and occasionally leases vehicles to Seashore or South State. Shimp agreed to provide the necessary trucks to South State. South State, after the accident, paid for the delivery of the barriers.

While making the delivery, one of One Sun’s part-time drivers, Greg R. Hoover, violated the company’s policy prohibiting passengers—his girlfriend accompanied him that morning. On his return trip, Hoover failed to stop at a traffic light, striking several vehicles in the intersection, causing injuries, and finally, landing on top of an overturned car that had been stopped at the red light. One of the occupants of that vehicle died. Hoover’s blood test results came back positive for marijuana. Although at the time of the accident he held a valid commercial driver’s license as well as a valid driver’s license, he had a history of driving infractions.

Obviously the insurance company for Hoover paid this claim for his negligence.  However, given the large number of claimants and the significant amount of the claims the independent’s limited insurance policy was not enough to fully compensate all claimants/  As a result, the plaintiffs attorneys were trying to have South State and Seashore be on note hook too. Factually, South State needed more trucks because they only own a few in their fleet for hauling their own materials and equipment.  South State then contacted their ‘other’ company, Seashore, to get more trucks to work on this locations.  Because Seashore regularly does not have enough trucks in its own fleet for this and all the other jobs they are working on at the same time it reach out to all the local ‘for hire’ independent contractors who own tractor/trailor or dump trucks. This process is a regular practice for these two companies.

A:  Do the Federal Motor Carrier Safety Regulations Apply to this Defendant?

The Federal Motor Carrier Safety Administration is the United States Department of Transportation agency that regulates the trucking industry. In that capacity, it has issued the FMCSR. See 49 C.F.R. §§ 350 to -99. The trial judge did not explicitly find that South State was engaged in interstate commerce, however, he concluded instead that the FMCSR did not apply to the company because it was not an authorized motor carrier. Plaintiffs argue that South State engaged in interstate commerce defined as “[b]etween two places in a State as part of trade, traffic, or transportation originating or terminating outside the State or the United States.” 49 C.F.R. § 390.5T (2017).

The term “interstate commerce” has a historically broad reach. See, e.g., Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241 (1964); Wickard v. Filburn, 317 U.S. 111 (1942). In considering the evidence in the light most favorable to the non-moving party, the judge may have assumed South State was engaged in interstate commerce. Brill, 142 N.J. at 529. That did not make South State liable, even applying the FMCSR. The FMCSR’s general leasing requirements, which set forth the conditions under which an authorized carrier may perform transportation in equipment it does not own, was not adopted by New Jersey. Those provisions are found in Part 376, which all parties agree have not been adopted. It is those leasing requirements which give rise to the “statutory employee” doctrine under which an authorized carrier may be held liable for the torts of an independent contractor. An authorized carrier is defined as “[a] person or persons authorized to engage in the transportation of property as a motor carrier under the provisions of 49 U.S.C. 13901 and 13902.” 49 C.F.R. § 376.2(a). Thus, South State is not liable under this theory.

As the trial judge found, the definition excluded private motor carriers: South State engages in the transportation of property to further its construction business and is not a for-hire carrier. . . . South State does not offer its transportation services to be leased by other companies and is therefore not covered under 49 C.F.R. § 390.5. . . . South State is not an “authorized carrier” for the purpose of FMCSR’s leasing provisions[.] He also noted that “[o]ne of the many purposes of the FMCSR[s] . . . was to prevent motor carriers from transferring responsibility for compliance with federal regulations to independent contractors.” That policy was not implicated in this circumstance.