McHale v. W.D. Trucking, Inc.

• Citation: 2015 IL App (1st) 132625,396 Ill.Dec. 46,39 N.E.3d 595
• Decision Date: 14 August 2015
• Docket Number: Nos. 1–13–2625,1–13–3067.,1–13–2626,s. 1–13–2625
• Parties: Steven McHALE, Special Administrator of the Estate of Stacey Lynn McHale, Deceased, Plaintiff–Appellee, v. W.D. TRUCKING, INC., a Corporation, Defendant, and Kiswani Trucking, Inc., a Corporation, Russell A. Kleppe and Transfreight, LLC, Defendants–Appellants. Transfreight, LLC, Third–Party Plaintiff–Appellee, v. W.D. Trucking, Inc., Third–Party Defendant, and Russell A. Kleppe and Kiswani Trucking, Inc., an Illinois Corporation, Third–Party Defendants–Appellants.
• Court: United States Appellate Court of Illinois

2015 IL App (1st) 132625
39 N.E.3d 595
396 Ill.Dec. 46

Steven McHALE, Special Administrator of the Estate of Stacey Lynn McHale, Deceased, Plaintiff–Appellee,
v.
W.D. TRUCKING, INC., a Corporation, Defendant,
and
Kiswani Trucking, Inc., a Corporation, Russell A. Kleppe and Transfreight, LLC, Defendants–Appellants.

Transfreight, LLC, Third–Party Plaintiff–Appellee,
v.
W.D. Trucking, Inc., Third–Party Defendant,
and
Russell A. Kleppe and Kiswani Trucking, Inc., an Illinois Corporation, Third–Party Defendants–Appellants.

Nos. 1–13–2625
1–13–2626
1–13–3067.

Appellate Court of Illinois, First District, Fifth Division.

Aug. 14, 2015.

39 N.E.3d 604

Lewis Brisbois Bisgaard & Smith LLP, Chicago (James B. Tobin, of counsel), for appellants Russell A. Kleppe and Kiswani Trucking, Inc.

Knight Hoppe Kurnik & Knight, Ltd., Rosemont (Elizabeth A. Knight and Michael J. Atkus, of counsel), and Grant & Fanning, Chicago (Patrick J. Fanning, of counsel), for appellant Transfreight, LLC.

Corboy & Demetrio, P.C., Chicago (Philip Harnett Corboy, Jr., and Matthew T. Jenkins, of counsel), for appellee.

OPINION

Presiding Justice PALMER delivered the judgment of the court, with opinion.

396 Ill.Dec. 55

¶ 1 Stacey Lynn McHale was killed when a tractor-trailer driven by Russell A. Kleppe hit her as she stood at the side of the road beside her automobile. Stacey's husband Steven McHale, as the special administrator of Stacey's estate, filed a wrongful death action against Kleppe,

396 Ill.Dec. 56

39 N.E.3d 605

Kleppe's employer Kiswani Trucking, Inc. (Kiswani) and Transfreight, LLC (Transfreight). Kleppe and Kiswani admitted negligence in Stacey's death. The trial court entered judgment on an $8 million jury verdict in favor of plaintiff in the wrongful death action. It also entered judgment in favor of Transfreight in its third-party indemnification action against Kiswani.

¶ 2 Kiswani and Kleppe appeal from the court's entry of judgment on the jury verdict, arguing the court erred in denying their motion for a new trial as the court's failure to enforce its decisions on various motions in limine denied them a fair trial. Transfreight appeals from the same order, arguing the trial court erred in failing to grant its motion for (1) a judgment notwithstanding the verdict as it had no liability for Stacey's death as a matter of law and (2) a new trial as the jury's verdict was against the manifest weight of the evidence and the court committed multiple trial errors. Kiswani also appeals from the judgment against it in Transfreight's indemnification action, arguing the court's finding that Transfreight did not modify the indemnification clause in the agreement between the parties was against the manifest weight of the evidence. We have consolidated the three appeals for review. We affirm.

¶ 3 BACKGROUND

¶ 4 Transfreight, Inc., a Canadian corporation, and Transfreight, LLC, a Delaware Corporation, (collectively Transfreight) entered into a written agreement with Toyota Motor Manufacturing North America (Toyota), a Kentucky corporation, to act as a "logistics provider." Under the agreement, Transfreight agreed to provide to Toyota or to arrange for the provision of "transportation and coordination of various commodities" as set forth in detail in the "scope of work" appendix attached to the agreement.

¶ 5 Toyota operated the production lines at its manufacturing plants throughout the United States on a "just in time" basis, meaning auto parts were delivered to the production lines only as the production lines needed them. Since the manufacturing plants shared suppliers, Toyota arranged to have auto parts destined for multiple plants picked up at one time from each supplier by truck. Each truck picked up auto parts from several suppliers and delivered the parts to a "cross-dock," where the parts were unloaded, sorted and consolidated into full truck loads that would then be delivered to a particular manufacturing plant.

¶ 6 In the agreement, Transfreight acknowledged that time was of the essence in the performance of the transportation services and, if it or its subcontractors were unable to meet Toyota's logistics schedule, Transfreight was to notify Toyota immediately. Transfreight could subcontract any portion of the transportation services and would "have sole and exclusive control over the manner in which [it] and its employees and subcontractor(s) perform the Transportation Services," with the understanding that any subcontractors "shall be considered to be solely the employees or subcontractor(s)" of Transfreight. The agreement provided "[t]he relationship between the parties shall, at all times, be that of independent Logistics Providers and such status shall govern all relations among Logistics Provider and any third parties."

¶ 7 Relevant here is Transfreight's role as a logistics provider for Toyota at the Toyota Tsusho Bedford Park cross-dock. The cross-dock was managed and staffed

396 Ill.Dec. 57

39 N.E.3d 606

by Toyota Tsusho.¹ Transfreight was one of several logistics providers for Toyota at the cross-dock and managed a portion of Toyota's inbound material flow there. It had three employees on site. Although Transfreight was itself a certified motor carrier and could pick up and deliver the Toyota parts, it did not operate in this capacity at the Bedford Park cross-dock. Instead, it contracted with other motor carriers to perform the Toyota "runs."

¶ 8 Transfreight received route specifications from Toyota for the supply runs. Each route specification included the supplier stops to be made on the route, the number of miles to be traveled and the number of days per week the route was to be run. It also included the time windows during which a driver was to start the route, arrive at each supplier, load supplies and depart the supplier and end the route back at the cross-dock. When Transfreight received the route specifications, it provided them to its approved carriers, who would then bid on the routes. Transfreight selected one of the carriers to run each route, paying the carrier according to the rate presented in the bid.

¶ 9 A subcontracted carrier fulfilling a Toyota route for Transfreight would dispatch a driver and truck to the cross-dock to pick up a trailer and begin the route. The Toyota Tsusho personnel at the cross-dock prepared the paperwork for each route, including pre and postroute inspection reports and the route specifications, and assigned a trailer to each driver on a route. The driver would pick up the paperwork packet, hook-up the assigned trailer, complete a preinspection of the empty trailer and start the route. After fulfilling the designated pickups at the parts suppliers on the route, the driver would return with the filled trailer to the cross-dock and complete the postinspection report. Transfreight required that it be notified by Kiswani or the driver when the driver left the cross-dock to start a route and when the driver returned to the cross-dock at the completion of a route. It also required that it be notified if an "exception" such as delay or accident occurred on a route. As required by its agreement with Toyota, Transfreight would then notify Toyota regarding the delay. As Toyota operated its production lines in a just-in-time manner, any delay in a production line's receipt of auto parts could negatively impact production, thus requiring Toyota to adjust the affected route or the manufacturing schedules for which the parts were intended.

¶ 10 One of the motor carriers Transfreight used for the Toyota runs was Kiswani. Pursuant to an October 2006 written "agreement for transportation services" between Transfreight and Kiswani, Kiswani agreed "to act as a sub-contract carrier for Transfreight for Transfreight's performance under its Master Agreement with [Toyota], or arrange for the provision of, the transportation and coordination of various commodities" as provided in the agreement. Kiswani would provide "transportation services" "at all times required by Transfreight to support" Toyota's "North American Manufacturing Companies" and as set forth in the "scope of work" appendix attached to the agreement.

¶ 11 The "scope of work" appendix provided that Kiswani was responsible for the "just in time * * * delivery of auto parts" to designated locations "to be assigned by Transfreight" and would "manage all assigned [Transfreight] routes based on the monthly regional route design specifications as provided by Transfreight." Kiswani was to monitor "all freight delivery

396 Ill.Dec. 58

39 N.E.3d 607

flow" and inform Transfreight "of all abnormal situations" through the channels set forth in Transfreight's " operating procedures." It was to load and deliver all trailers based on Toyota's standards and follow the freight verification procedures established by Toyota's North American logistics network. The appendix set forth in detail the services Kiswani was to perform to provide the...