A Louisiana federal court recently determined that a non-trucking liability insurance policy excluded coverage for a motor vehicle accident that occurred when a bobtailed tractor was pulled over on the side of the road while the driver slept. A “non-trucking liability” insurance policy provides insurance for “bobtailed” tractors, a tractor operated without a trailer, when the tractor is not in use for business purposes. A non-trucking liability policy does not provide commercial auto or general liability coverage.
In Williams v. Great American Insurance Company, No. 16-2236 (E.D. La. 3/8/17), 2017 WL 914064, decided by a Louisiana federal district judge, a truck driver drove a tractor trailer he owned and operated, but leased to MCT Transport, LLC, to deliver goods to a facility in Pearl River, Louisiana. After arriving at the facility around 11:30 p.m., he left his trailer to be unloaded, and drove his tractor from the facility to sleep. At about 1:30 a.m., while the driver was asleep, allegedly illegally parked on a highway, the plaintiff’s vehicle struck the tractor.
The Great American Insurance Company non-trucking liability policy issued to the driver excluded “bodily injury or property damage arising out of any accident which occurs while the covered auto is being used in the business of any lessee or while the covered auto is being used to transport cargo of any type.” The policy defined “in the business of any lessee” to include the use of a tractor “by any person or organization acting under the direction, control or dispatch of any lessee,” or “while traveling to or from any location for the purpose of picking up, delivering or transporting cargo on behalf of any lessee.”
The insurer, Great American, argued that the trucker was in the business of trucking for MCT at the time of the accident, and therefore coverage did not apply under the Great American policy. The district court agreed with Great American, noting that although MCT did not direct that the trucker sleep in his trailer, MCT did not dispute that it is company policy that if a trailer is available for transport from its facility, a driver must transport the trailer to another nearby MCT facility to pick up another load. The court found this requirement demonstrated that the driver’s tractor was still in the business of MCT at the time of the accident. The driver was not off the clock or headed home at the time of the accident; the fact that the driver chose to wait until the following morning did not render him outside of the business of trucking for MCT. Furthermore, the court also noted that federal regulations required the driver to take a 10-hour break after driving for 11 hours, which is when this accident occurred.
The court cited the Fifth Circuit case of Mahaffey v. General Sec. Ins. Co., 543 F.3d 738 (5th Cir. 2008), in which the Fifth Circuit found that the driver was in the business of the trucking company when the driver was involved in an accident after dropping off his cargo and trailer and being told to “take the night off” and call for instructions for a new load the following morning. Although the driver in Mahaffey usually slept in his cab, he had gone to a motel for the night. He was involved in the accident on the way to the motel. The court found that the driver was acting in the business of the trucking company, noting that the driver was on standby for further deliveries, and was not on his way home or released to go home by the trucking company. For these reasons, the trucking company’s primary insurance provided coverage for the accident.
The Williams decision is important for insurers and trucking companies because it demonstrates that a trucker may be “in the business” of a trucking company, even when the trucker is not carrying a load or sleeping. Trucking companies and insurers will have to consider this very fact-specific precedent when evaluating risks and deciding upon coverage.