Johnson & Bell, Ltd. Transportation Law Update
By Gregory D. Conforti &
Recently, a jury awarded plaintiffs a $23,775,000 judgment in a wrongful death and personal injury case in Illinois, Sperl v. C.H. Robinson Worldwide, Inc. This verdict may send shockwaves through the state of Illinois because the jury concluded that Defendant C.H. Robinson (CHR) was vicariously liable based on agency theories, despite the fact that there was an agreement in place addressing the status of the driver as an "Independent Contractor" with language that attempted to limit the liability of the shipper. CHR appealed, the Appellate Court (Third District) affirmed the verdict.
CHR filed a judgment notwithstanding the verdict claiming that evidence failed to establish an agency relationship, and the trial court denied that motion. The driver, DeAn Henry, was driving a tractor-trailer containing a load of potatoes. She was unable to stop her truck in time to avoid a collision and ran over several vehicles, causing a multiple-car accident. Plaintiffs Joseph Pearl and Thomas Sanders were killed, and another sustained serious injuries. Henry owned the tractor she was driving and leased it to Dragonfly, a motor carrier. She was delivering a load for CHR.
Plaintiffs sued Henry, Dragonfly and CHR for wrongful death and personal injuries. Henry and Dragonfly admitted liability, whereas CHR denied liability and sought contribution from its co-defendants. CHR is a logistics company providing a variety of transportation-related services. It does not own tractor-trailers, nor does it employ drivers. CHR sells its services to customers or shippers needing to transport good and then contracts with carriers to provide transportation for its customers.
Dragonfly and CHR entered into a contract whereby Dragonfly warranted that it was going to use competent drivers and that CHR was not liable for drivers’ salaries, wages, charges, or worker’s compensation expenses. Henry testified at trial that she was not given instructions from CHR as to how to get from one destination to the next. She was given instruction, however, on how to handle materials.
Plaintiff hired an expert, Whitney Morgan, who agreed that CHR was generally a freight broker, but also said its conduct in this case fell into the definition of a motor carrier. He testified that CHR dealt directly with Henry and that if Henry successfully delivered the load, she would be paid directly by CHR.
The Court noted that a principal is vicariously liable for the conduct of its agent, but not for the conduct of an independent contractor. The Court looked to the level of control CHR had over the driver. The Court rejected the carrier agreement as controlling, and instead focused on the conduct of the parties. In this case, the right to control the manner of work performance was paramount. The Court determined that the jury’s verdict was not against the manifest weight of the evidence.
CHR clearly controlled the manner of Henry’s work performance. The Court distinguished other cases holding that the driver was an independent contractor based on the level of control CHR exercised over its transactions with this driver. The driver, Henry, contacted CHR directly to ask for more work, was given detailed “special instructions” concerning the load owned by CHR, was required to pick up a load at a specific time, make daily check-in calls, and stay in constant communication with CHR dispatchers. She was also required to notify CHR of an accident, and required to measure temperature of the product during the trip. CHR also paid the driver directly. Moreover, CHR owned the product being transported and it was being delivered to a CHR warehouse. Finally, CHR imposed fines on the driver to ensure timely delivery and it was these fines that encouraged the driver to violate federal regulations in order to avoid them.
The moral of the story: A shipper's contract with an independent contractor may have little or no effect on limiting the shipper's exposure for the actions of their "independent contractor" if the shipper's conduct in controlling the independent contractor work speaks to the contrary.
If you would like a copy of the Court’s ruling, please contact Mr. Conforti at [email protected] or Mr. Sidoti at [email protected].