Saullo v. Douglas

• Decision Date: 11 May 2007
• Docket Number: No. 5D06-817.,5D06-817.
• Citation: 957 So.2d 80
• Parties: James SAULLO, as Personal Representative, etc., Appellant, v. Jessie J. DOUGLAS and Dart Transit Company, Appellees.
• Court: Florida District Court of Appeals

957 So.2d 80

James SAULLO, as Personal Representative, etc., Appellant, v. Jessie J. DOUGLAS and Dart Transit Company, Appellees.

No. 5D06-817.

District Court of Appeal of Florida, Fifth District.

May 11, 2007.

Ross Bennett Gampel of Klemick and Gampel, P.A., Miami, and Steven M. Goldsmith, of Steven M. Goldsmith, P.A., Boca Raton, for Appellant.

David R. Evelev, Griffith J. Winthrop, and Julianne J. Flynn, of Alvarez, Sambol, Winthrop & Madson, P.A., Orlando, for Appellee, Dart Transit Company.

No Appearance for Appellee, Jessie J. Douglas.

MONACO, J.

James Saullo, as personal representative of the Estate of James J. Saullo, seeks review of the final order of summary judgment granted in favor of the appellee, Dart Transit Company, one of the of two defendants below. Because there are factual issues concerning the liability of Dart that are still outstanding, we reverse.

The essentially uncontested facts reflect that shortly before the incident that gave rise to this suit occurred the other defendant below, Jessie Douglas, a professional truck driver, was driving a tractor-trailer rig through central Florida. The tractor was owned by Mr. Douglas, but leased to Dart, and the trailer was fully owned by Dart. Pursuant to the operating agreement between Dart and Mr. Douglas, which defined the driver's status as that of an independent contractor, Mr. Douglas agreed to lease the tractor permanently to Dart. Because Dart was an interstate carrier subject to federal regulation, the operating agreement was drafted in accordance with the requirements of federal regulations. Under the standard contract Mr. Douglas agreed to drive the tractor exclusively to haul freight in trailers owned by Dart.

While asleep at a rest area on one such trip in which Mr. Douglas was transporting freight for Dart, Mr. Douglas received a call from his brother, who related that his car was stuck in the mud not far from where Mr. Douglas was resting. He asked Mr. Douglas to help him remove it, and Mr. Douglas agreed to do so. When Mr. Douglas arrived at a point near to his brother's location, he parked and detached the trailer in the far right-hand lane of a four-lane roadway, and directed his brother's girlfriend to park her car behind the trailer and to activate the automobile's emergency flashers. He did so because the trailer did not have operational lights when detached from the tractor. Mr. Douglas did not take the precaution of setting emergency flares or safety triangles around the trailer. After detaching the trailer, Mr. Douglas drove the tractor down the road to help with his brother's vehicle.

James J. Saullo was killed in the early morning hours purportedly when he swerved his automobile to avoid the trailer and the automobile parked on the roadway. Mr. Saullo had been drinking and playing pool at a bar, and was on his way to a friend's apartment at the time of the incident. When he came upon the vehicles, he apparently swerved sharply to avoid a collision, lost control of his car, and slammed into a tree. He was legally intoxicated and not wearing a seatbelt at the time of the collision.

The personal representative of Mr. Saullo's estate filed a wrongful death action against Mr. Douglas and Dart. Dart moved for summary judgment. The Estate opposed the motion, arguing, first, that the federal regulations that govern interstate trucking imposed liability on Dart for the actions of Mr. Douglas, and alternatively, that Dart was liable by virtue of the application of respondeat superior to the dangerous instrumentality doctrine. The trial court, however, granted summary judgment in favor of Dart, holding that Dart was not liable for the actions of Mr. Douglas under either theory. The Estate appealed.

A resolution of this case requires us first to examine the federal regulations governing interstate tractor-trailer trucks. We begin with the enabling legislation.

In 1956, Congress expanded the authority of the Interstate Commerce Commission ("ICC"), to permit the agency to regulate more closely the lease of motor vehicles used in interstate commerce. R Clay Porter & Elenore Cotter Klinger, The Mythology of Logo Liability: An Analysis of Competing Paradigms of Lease Liability for Motor Carriers, 33 TRANSP. L.J. 1, 5 (2005) [hereinafter Logo Liability]. Although the wording of the enabling statute has changed slightly since 1956, the substance of the statute remains the same today. Of particular relevance to the present controversy, the current version of the statute, 49 U.S.C. 14102 (2007),¹ authorizes the Secretary of Transportation to require an interstate motor carrier that uses motor vehicles it does not own to transport property under an agreement with another party to "have control of and be responsible for operating those motor vehicles in compliance with requirements prescribed by the Secretary on safety of operations and equipment, and with other applicable law as if the motor vehicles were owned by the motor carrier." 49 U.S.C. 14102(a)(4). The enabling legislation, however, does not specifically address the liability of a carrier that chooses to use nonowned tractors.

One of the primary reasons Congress expanded the province of the Secretary, and thus, the ICC,² was "to protect the public from the tortious conduct of judgment-proof operators of interstate motor carrier vehicles," by requiring motor carriers "to assume full direction and control of leased vehicles." See Price v. Westmoreland, 727 F.2d 494, 496 (5th Cir.1984). A fair reading of the leasing regulations yields the notion that they were specifically intended to prevent motor carriers from avoiding responsibility for the negligence of their drivers through the use of an owner-operator relationship. Logo Liability, 33 TRANSP. L.J. at 6. The ICC effectuated this purpose by promulgating leasing regulations requiring, among other things, that leases be in writing and "provide for the exclusive possession, control, and use of the equipment, and for the complete assumption of responsibility in respect thereto, by the lessee for the duration of said contract, lease or other arrangement. . . ." (emphasis added). See 49 C.F.R. 1507.4 (1974).³ Moreover, the regulations require motor carriers that use leased equipment to provide the lessor with a placard that contains information identifying the motor carrier for whom the equipment is being operated. Logo Liability, 33 TRANSP. L.J. at 6 (citing 49 C.F.R. 390.21 (2005)). The placard is usually affixed to the door of the tractor. Before the regulations were amended in 1986, it was the motor carrier's responsibility to retrieve the placards when the lease terminated. Id. at 6 (citing 49 C.F.R. 1507.4(d)(1) (1974)).

The leasing regulations gave birth to a judicially-created doctrine called "logo liability." Id. Under this rule, the mere presence of a motor carrier's placard in a tractor leased by the carrier created an irrebuttable presumption that the lease continued at all times in effect. Ross v. Wall St. Sys., 400 F.3d 478, 479-80 (6th Cir.2005). Courts that applied the doctrine of logo liability consistently held that the federal leasing regulations preempted state law in tort actions where a member of the public was injured by the negligence of a motor carrier's employee while operating the motor carrier's vehicle. See Price, 727 F.2d at 496.

Thus, considerations steeped in respondeat superior and master-servant relationships were essentially disregarded. See Simmons v. King, 478 F.2d 857 (5th Cir. 1973). Rather, under the leasing regulations, the lessor-truck driver was deemed to be a "statutory employee" of the lessee-motor carrier, and the motor carrier was, accordingly, liable as a matter of law for the negligence of the driver. The practical effect of the doctrine of logo liability was, therefore, to impose strict liability on a motor carrier for the negligence of its driver, regardless of whether the driver was an independent contractor and regardless of whether the lease was actually in effect at the time the injury occurred, so long as the motor carrier's placard was affixed to the tractor. See Ross, 400 F.3d at 479-80 (6th Cir.2005).

In 1986, however, the ICC amended the leasing regulations to clarify that it never intended "to assign liability based on the existence of placards or to interfere with otherwise applicable State law." Lease & Interchange of Vehicles (Identification Devices), 3 I.C.C.2d 92, 93-94 (1986). Under the amended regulations, the motor carrier was no longer required to obtain a receipt from the driver when the driver returned the placard upon termination of the lease. See Graham v. Malone Freight Lines, Inc., 948 F.Supp. 1124, 1133 n. 14 (D.Mass.1996); 49 C.F.R. 1057.4(d) (1985). At the time of the 1986 amendments, the ICC explained:

As noted by the comments, certain courts have relied on Commission regulations in holding carriers liable for the acts of equipment owners who continue to display the carrier's identification on equipment after termination of the lease contract. We prefer that courts decide suits of this nature by applying the ordinary principles of State tort, contract, and agency law. The Commission did not intend that its leasing regulations would supersede otherwise applicable principles of State tort, contract, and agency law and create carrier liability where none would otherwise exist. Our regulations should have no bearing on this subject. Application of State law will produce appropriate results.

Lease & Interchange of Vehicles (Identification Devices), 3 I.C.C.2d 92, 93-94 (1986)(emphasis added).

In the wake of the 1986 amendments and accompanying ICC comments, many federal courts disavowed the logo liability doctrine. The majority of courts, however, apparently not taking the ICC at its word, still interpreted the amended regulations to impose liability whenever a lease was actually in effect, regardless of whether the driver was acting within...