By: Terry Morgan, Distinguished Logistics

Professional & Certified in

Transportation and Logistics & Surface

Transportation Board Practitioner

Though the Interstate Commerce Commission came into being in 1887, trucking was not

regulated until 1935. Of course the ICC has been terminated for a few years now but many

of their responsibilities remain with either the Federal Motor Carrier Safety Administration

or the Surface Transportation Board. Both are agencies within the U.S. Department of

Transportation. Almost from the beginning, it was recognized that truckers needed to supplement

their fleets with equipment and drivers that they did not own or employ in order to balance the peaks

and valleys of their business and equipment needs. This wide use of owner/operators and contracted

equipment presented challenges to litigation involving trucks. It is common for a trucking company

to try to shift liability to the actual owner and operator of the commercial motor vehicle when the

unforseen happens.

That shifting of responsibility is largely a smoke screen. Included in the regulations that have

survived the many changes the trucking industry has gone through, are regulations addressing

the issue ofleasing of equipment with drivers for both short periods and for extended periods

of time. Without going into every detail of the leasing regulations, the most important elements

involved with most litigation is the lessee (primary carrier) has the exclusive use, possession and

control of the leased equipment. Additionally, the lessee must maintain financial responsibility to

the public (insurance). The lease agreement may contain provisions requiring the lessor (trucks

owner and operator) to provide certain insurances or require them to pay for the insurance the lessee

provides. The lessee is, in all but rare exceptions, responsible for the operations of the truck.

Provisions contained in a lease agreement does not relieve the lessee from the primary responsibility

to the public for the safe operation of the leased vehicles and drivers. Owner/operators and leased

drivers operating leased fleets are, for purposes of the regulations, statutory employees and the lessee

must train them, qualify them and monitor their compliance with the regulations as if they were

employees. Vehicles leased with drivers must be maintained and inspected by the lessee in

compliance with the regulations also.

Alease agreement is supposed to be written but whether it is written or oral, the lease, in most

cases, is binding on the carrier contracting to transport the shipment(s). The insurance filings

that must be made with the Federal Motor Carrier Safety Administration or are required by

the U.S. Department of Transportation only state that the insurance company is insuring the motor

carrier and does not identify any specific trucks, the number of trucks being operated, nor whether

the trucks are owned or leased.

In many cases owner/operators are used just for a specific shipment, group of shipments or for a

limited period of time. In the industry these agreements are known as a trip lease. Whether the

vehicle is operating on an on going lease, trip lease or an oral lease for either, the motor carriers

responsibility to the public remains unchanged. If an accident happens when the truck is loaded or

empty, but a lease is in effect, had been in effect, or is going to be in effect, the lessee remains

responsible for the commercial motor vehicles being operated in furtherance of their business


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Frequently, a trucking company will claim to be something other than a trucking company when

an independent contractor’s truck gets involved in an accident. Some will claim to be a freight

broker or some other non-carrier entity and say they only brokered the load to the truck

involved in the accident. Whoever is listed on the bill of lading as the carrier is most often the

carrier. A broker can only arrange transportation, they can not hold themselves out to be a carrier.

If they are a trucking business, even if they also hold a broker license, and are listed as the carrier

on the shipping documents, they are going to be hard pressed getting out from under their obligations

as a earner.

DISCLAIMER: This article is not intended to be legal advice. It is only intended to be information based on the experience of the

author and only under the specific circumstances contained herein. Consult with a qualified attorney to determine how the issues

outlined above may apply to your specific circumstances