"But I didn't do it!": Expanding Theories of Vicarious Liability[dagger]

FDCC Quarterly, Summer 2008 by Franklin, Robert T

The FMCSR is "applicable to all employers, employees, and commercial motor vehicles, which transport property or passengers in interstate commerce."34 Accordingly, an employment relationship is required. Although the employment relationship between the driver and the broker is unlikely, the FMCSR specifically defines an employer as "any person engaged in a business affecting interstate commerce who owns or leases a commercial motor vehicle in connection with that business, or assigns employees to operate it."35

Accordingly, in addition to the employment relationship, the broker must own or lease the commercial motor vehicle involved in the accident. Absent these requirements, the broker cannot be held liable for any breach of the statute or regulations by the driver.36 Indeed, absent the employment relationship, the broker has no duty to ensure that the driver is complying with, for example, the hours of service requirements.37

2. Status of Broker as Carrier

Some third party logistics companies and brokers are also motor carriers under the MCA and FMCSR. The mere fact that a broker is also considered a carrier, however, is not dispositive with respect to liability. A "motor carrier" is defined as "a person providing commercial motor vehicle transportation for compensation."38 A "broker," on the other hand, is a "a person, other than a motor carrier or an employee or agent of a motor carrier, that as a principal or agent sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement, or otherwise as selling, providing, or arranging for, transportation by motor carrier for compensation."39 The FMCSR specifically distinguishes the two, providing that "[m]otor carriers ... are not brokers within the meaning of this section when they arrange or offer to arrange the transportation of shipments which they are authorized to transport and which they have accepted and legally bound themselves to transport."40

The distinction becomes relevant, because the FMCSR's definition of "employee" includes independent contractors.41 If independent contractors are included, and a broker is also a motor carrier, a plaintiff may argue that the broker is, accordingly, liable for the actions of the driver.

The inquiry, of course, must extend beyond the basic facts. What is relevant is whether the broker/carrier held itself out as a motor carrier with respect to the particular shipment, or whether it was merely the broker.42 This requires an inquiry into the specific facts of each case. For example, in Schramm the court stated:

Plaintiffs point to several factors regarding [the broker's] general method of operation and specific conduct in this transaction to support their assertion that [the broker] acted as a carrier: (1) [the broker] marketed itself as "one-point of contact" which would handle all of its customers' shipping needs; (2) [the broker] had FMCSA authority to operate as a carrier; (3) [the broker] was listed as the carrier on the bill of lading; (4) [the broker] takes responsibility for freight claims and maintains insurance coverage beyond that which is required of brokers; (5) [the broker] dispatched the driver; and (6) [the broker] has performed carrier services in previous contracts and has an affiliate that holds motor carrier authority.43