Canadian trucker policy: Georgia collision: Depleted funds defense: Third-party beneficiary: Structured settlement

Law Reporter, Mar 2004

Johns v. Phantom Freightliners, Ltd., U.S. Dist. Ct., N.D. Ga., No. 1: 03-CV-0935, Oct. 6, 2003.

As a Canadian tractor-trailer was traveling on a Georgia highway, it rear-ended a car, then crossed the centerline, colliding with Johns's vehicle. Johns and her mother, who was her passenger, were injured.

Johns's mother and the driver of the car that was rear-ended settled with the trucking company's insurer during mediation for its policy limits. Johns received nothing in this settlement arrangement.

Johns and her husband sued the truck driver, the trucking company, and the trucking company's insurer. Suit against the driver alleged she was negligent in taking her eyes from the road to reach for a radio. Suit against the trucking company was under a respondeat superior theory of liability. Plaintiffs alleged that under Canadian law, Johns is a judgment creditor and third-party beneficiary of the insurance contract between the trucking company and its insurer. Under Canadian law, the rights of an injured person cannot be limited by an insurer who makes a private settlement with other claimants. Since Georgia uses the law of the place of agreement for contracts cases, plaintiffs argued that Canadian law should apply and thus, the insurance policy was not depleted by the earlier settlements.

The parties reached a structured settlement with a present value of $600,000 during mediation, including an initial cash payment of $114,000.

Plaintiffs' expert was Ward Zimmerman, economics, Asheville, N.C.

Plaintiffs' Counsel

*Eric P. von Wiegen, Lexington, Ky.

Kenneth Vanderhoff, Cumming, Ga.