Risk Management

Lloyd’s suit against trucking companies can proceed

Judy Greenwald

June 05, 2017 Reprints

Lloyd's of London Auto liability Coverage Disputes P/C Insurers Latin America More + Less -

Lloyd’s suit against trucking companies can proceed

A U.S. District Court has refused to dismiss litigation filed by Lloyd’s of London underwriters against a trucking firm seeking compensation for a $275,000 claim Lloyd’s paid for damaged cargo.

The litigation concerns the transportation of a laser cutting machine. Pharr, Texas-based trucking firm Transport Continental Inc. and Transport Continental Logistics had agreed orally and in writing to provide a transportation trailer to carry the machinery from Queretaro, Mexico, to Chickasha, Oklahoma, according to Wednesday’s ruling by the U.S. District Court in San Diego in Certain Underwriters at Lloyds subscribing to Policy No.0801Q16413M13 v. Transport Continental Inc. and Transport Continental Logistics. The contract said the cargo was to be delivered in the same condition as when it was received.

However, the defendants allegedly delivered the cargo severely damaged, with a total loss amount of $275,000 and Lloyd’s was obligated to indemnify the owner, who is not identified in the complaint.

Lloyd’s filed suit in U.S. District Court in San Diego in November 2016 against Transport Continental on charges including breach of contract and negligence. Defendants responded with a motion to dismiss the case.

Defendants said in court papers they had contracted with a Mexican carrier to deliver the cargo from Queretaro Mexico to the border crossing at Laredo, Texas, where it was found to be damaged.

The District Court refused to dismiss the case. Defendants say the cargo was damaged in Mexico and Mexican law applies, said the ruling. But plaintiffs’ complaint never discussed where the cargo was damaged, it said.

“Accordingly, as both of defendants’ main contentions are premised on extrinsic evidence on which this court cannot take into consideration, its arguments collapse upon themselves,” said the ruling, in denying the motion to dismiss the case.