Digest of Interesting and Significant Cases in the Areas of Insurance and Transportation

	The 11^th Circuit Court of Appeals struck down a motor carrier’s tariff provision which required a shipper to request excess liability coverage but failed to provide a place for that declaration on the bill of lading. A copy of the decision can be viewed here (Sassy Doll v. Watkins) (May 23, 2003).
	The Southern District of New York prevented a garment manufacturer from recovering for lost sales where the manufacturer failed to establish that it was unable to fill orders. In the same decision the court held that an inland motor carrier was not entitled to assert its tariff limitation against the ocean carrier when the goods were shipped under a through ocean bill of lading. A copy of the decision can be viewed here (Levi Strauss v. Sea Land) (May 15, 2003.
	In the Court of Appeals in California, the court held that while a motor carrier can assert its contractual limitation of liability against some one who is not a party to the contract, no limitation will apply when a carrier is grossly negligent. A copy of the decision can be viewed here (Future Packing v. Three Way) May 13, 2003.
	The Eastern District Court in New York has ruled that the BMC-32 endorsement is applicable to contract carriage, despite the fact that the Federal Highway Administration still does not require contract carriers to have this endorsement. The decision is currently under appeal by the insurance carrier. A copy of the decision can be viewed here (M. Fortunoff of Westburry Corp. v. Peerless Insurance Co.) (March 27, 2003).
	The 5^th Circuit Court of Appeals has confirmed that an auto liability insurer will not be held liable under an MCS-90 endorsement when the endorsement was not requested by the motor carrier. The plaintiff sought to have the endorsement deemed a part of any policy issued to a regulated carrier. A copy of the decision can be viewed here (Illinois Central Railroad v. Ronald L. Dupont) (April 1, 2003)
	The 7^th Circuit Court of Appeals held that when a carrier issues a clean bill of lading for cartons of goods, and the cartons are damaged at destination, there is a presumption that the goods inside the cartons were damaged by the motor carrier. There is no further need for the shipper to establish the condition of the goods in the carton at the time of tender to the motor carrier. The court also provided a detailed analysis of the conditions under which a shipper is entitled to recover invoice value or cost plus necessary expense. A copy of the decision can be viewed here (American National Fire v. Yellow Freight) April 10, 2003
	In a recent decision in the 2d District Court of Appeals in California, the court upheld the extension of a COGSA $500 limitation to damage which occurred off the vessel. The court held that the burden was on the shipper to establish that it was denied a fair opportunity to declare an increased valuation. A copy of the decision can be viewed here (Continental Insurance v. Columbus Line).
	Form E - In an action in which the insurer is being represented by Schindel, Farman & Lipsius, LLP, the 11th Circuit Court of Appeals has requested that the Georgia Supreme Court determine whether the failure to cancel a Form E filing when the underlying policy was cancelled will result in liability either for the policy limits or the minimum obligation required by the state. In addition, the court has also asked the Georgia Supreme Court to determine the affect of a policy provision which limits "filing liability" to the statutory minimum. This decision can have a substantial impact on an underwriters analysis of its exposure under all filings. A copy of the decision can be viewed here (Jason Ramirez v. Progressive Preferred Insurance Co.) February 13, 2003.
	MCS-90 Endorsement - The 4^th Circuit Court of Appeals adopted the position that the MCS-90 endorsement in a truckers auto liability policy can not be used to determine the allocation of loss among insurers. The court held that it would look only to the terms and conditions of the policy in determining loss allocation. This is generally accepted as the majority view, although there still remain a number of courts which have held that the MCS-90 modifies the auto liability policy for all purposes. A copy of the decision can be viewed here (Canal Insurance Co. v. Distribution Services, Inc.) February 27, 2003.
	Household Goods Limitation of Liability - A Texas state court recently upheld a .10 cent per pound limitation on an intra-state bill of lading. The court held that a clear notation of the limitation on the front of the bill of lading was sufficient to meet the requirements of notice. This case is also interesting because the plaintiff was not a party to the bill of lading contract yet was still held subject to the limitation. A copy of the decision can be viewed here (Prime Products, Inc. v. Con_Way Transportation Services, Inc.) February 6, 2003.
	Two recent court decisions have been issued addressing the rights of carriers to limit their liability for loss or damage to cargo. In the Fifth District Court of Appeals in Florida the court refused to apply a limitation of liability when the carrier could not establish the existence of a proper tariff. Of even more interest was a finding by the court that a subsequent agreement to pay for repairs, after the damage, was sufficient to create a separate cause of action, not subject to any limitation. Braid Sales & Marketing v. R & L Carriers, Inc. (January 24, 2003) In the Second District Court of Appeals in California the court permitted a motor carrier to rely on a limitation of liability despite evidence that the parties may have agreed to a full replacement valuation prior to the loss. The fact that the shipper (also a carrier) prepared a bill of lading with a limitation was sufficient to bind that party to the limitation. Johanne Dictor v. David & Simon, Inc. (February 14, 2003)
	CARGO LOSSES - In a recent ruling in the Third Circuit Court of Appeals a motor carrier was found liable for the full invoice value of a shipment of greeting cards which was lost and arrived four months behind schedule. While it was conceded that there was no time sensitive notice given to the motor carrier, the court found the loss to be reasonably foreseeable and not subject to the recognized rules for consequential damages. A copy of the decision can be viewed by clicking here. (January 29, 2003)
	Recent Developments In Transportation and Insurance Law (January 15, 2003)
	Recent Developments In Transportation and Insurance Law (January 15, 2002)
	In the continuing struggle to determine when a vehicle is covered by non-trucking use/bob-tail policies, the fifth circuit court of appeals in EMPIRE FIRE AND MARINE INSURANCE COMPANY, v. BRANTLEY TRUCKING, INC. held that a tractor being serviced while awaiting loading of the trailer was in the business of the motor carrier and not covered by the non-trucking use policy. The case is only significant because the fifth circuit in Assicuarazioni Generali, S.p.A v. Ranger Insurance, 64 F.3d 979 (5th Cir. 1995) found the non-trucking use exclusion ambiguous. August 15, 2000. EMPIRE FIRE AND MARINE INSURANCE COMPANY, v. BRANTLEY TRUCKING, INC. (see text of decision)
	Frequently insurers issuing non-trucking policies list the insured as "owner operators under lease to ABC trucking." An issue that arises is whether ABC Trucking is an insured under such policies. The sixth circuit in an unpublished decision ruled that the lessee trucker is not a named insured under such policies. ST. PAUL FIRE & MARINE INSURANCE COMPANY, Plaintiff Appellant, v. ACCEPTANCE INSURANCE COMPANY, Defendant Appellee (see text of decision)
	Two insurance carriers issued policies to truckers. One policy was issued to the lessee, the other to the lessor. Neither policy provided coverage, but both contained MCS-90 Endorsements. The US Court of Appeals for the Eighth Circuit held that after Insurer A satisfied the judgment, it was entitled to contribution from insurer B which refused to contribute. This decision is in direct conflict with a Fifth Circuit decision. October 12, 1999. Redland Insurance Company v. Shelter Mutual Insurance Company (see text of decision)
	See 1999 edition of "Recent Developments in Transportation and Insurance Law" with links to the full text of all cases discussed (January 15, 1999)
	A Federal court in Illinois has held that an excess insurer does not have a right of action for malpractice against a law firm defending the insured and hired by the primary layer self-insured insured because an attorney client privilege does not exist. The court, however, permitted the action to go forward pursuant to the concept of equitable subrogation. April 20, 1998. National Union Ins. Co. v. Dowd & Dowd, P.C., 2 F.Supp.2d 1013, (N.D.Ill. 1998) (see text of decision)
	The United States District court for the Southern District of New York held that Clarendon National Insurance Company, an insurer which defended an insured without reservation for three and a half years before discovering its policy did not provide coverage, was not estopped from denying coverage as coverage cannot be created by estoppel. Ira S. Lipsius of Schindel Farman & Lipsius represented Clarendon National. May 8, 1998. (see text of decision)
	A New Mexico Court has held that an insurer cannot be held liable under regulatory agency filings and endorsements that it did not issue, even if the insurer should have been known that the insured needed the filings. The court relying on North River Insurance Co. v. Cy Thompson Agency, Inc., 840 F.2d 839 (lst. Cir.1988) held that as the burden was on Quality Xpress, Inc., to comply with the regulatory permitting requirements, including those involving the filing of certificates of insurance, "unless and until and insurer signs and authorizes the filing of regulatory forms it cannot be held liable." Ira S. Lipsius of Schindel, Farman and Lipsius was of counsel to the insurer, Guaranty National. Christine Howard, et al., v. Quality Express., Et Al., v. Guaranty National Insurance Co. (see text of decision)
	Federal Appellate Court holds that claim for "negligent supervision" which arises from sexual molestation is covered by General Liability policy despite Sexual Molestation exclusion. The court opened up the possibility that negligent supervision claims resulting in auto accidents may result in coverage under the GL policy. July 23, 1998 (see text of decision)
	Court gives fair warning to attorneys who exceed page limits through subterfuge. (see partial text of decision)
	EVA KAPLAN, APPELLANT v. HARCO NATIONAL INSURANCE COMPANY, APPELLEE Decided March 24, 1998 (see text of decision)
	UNIVERSAL AM-CAN, LTD, and National Union/AIAC, Petitioners, WORKERS' COMPENSATION APPEAL BOARD (MINTEER), Respondent. Decided February 2, 1998 (see text of decision)
	MGM TRANSPORT CORPORATION and LIBERTY MUTUAL INSURANCE COMPANY, Plaintiffs, v. ELSIE R. CAIN, TIMOTHY CLARK BUTTERFIELD, JAMES CLEVELAND HOLMES and NORTHLAND INSURANCE COMPANY, Defendants. Filed January 20, 1998 (see text of decision)
	The United States Court of Appeals for the Eighth Circuit ruled that a shipment of corn carried wholly intrastate was in interstate commerce because it was carried to a terminal where 99% of the shipments were sold to customers outside of the state. As a result of the interstate nature of the transportation the MCS-90 is applicable. Filed January 7, 1998 (see text of decision)
	A Connecticut court held that the BMC-32 cargo endorsement does not create coverage and therefore failure to cancel the endorsement does not create policy coverage which would not have otherwise existed. Decided January 14, 1998 (see text of decision)