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Insurer's liability hinges on employment status of trucker killed in crash


Because a truck driver killed in an accident may not have been an employee of the company that leased the truck, an insurer could be liable to provide coverage in his death, says an appeals court in reversing a lower court ruling.

Expeditor’s Express Inc., a unit of Seattle-based Expeditor’s Express of Washington Inc., leased a 1997 truck from truck owner William Littlefield, which Donald Underwood drove from Tennessee to Georgia, transporting magazines for Expeditor’s, according to Tuesday’s ruling by the 6th U.S. Circuit Court of Appeals in Cincinnati in Gramercy Insurance Co. v. Expeditor’s Express Inc. et al.

An Insurance contract between Dallas-based Gramercy Insurance —which was put into liquidation in August 2013, according to its website — and Expeditor’s Express provided liability coverage for Expeditor’s trucking business, according to the ruling. The ruling does not include the amount of coverage.

The contract includes an exclusion for Expeditor’s Express employees, says the ruling. It defines “employee” to include a “leased worker” but does not include a “temporary worker,” according to the ruling.

Mr. Underwood became employed by Mr. Littlefield as a commercially licensed driver in early August 2010, according to the ruling. On Aug. 5, 2010, he was driving the Volvo truck on Interstate 24 in Marion County, Tennessee, to Atlanta, when the truck got a flat tire and Mr. Underwood lost control.

The truck collided with a guardrail and crossed over it, overturned in a ravine and caught fire, and Mr. Underwood died in the fire, according to court papers.

Gramercy Insurance filed suit in the case, seeking a declaration it was not obligated to provide coverage because Mr. Underwood was an Expeditor’s employee.

A unanimous three-judge appellate panel said Mr. Underwood’s status was ambiguous. “Was Underwood an employee at the time of the accident? Maybe yes; maybe not,” said the ruling. “Yes, he was driving a truck leased by Expeditor’s Express that was carrying its magazines when the accident occurred.

“But, so far as the pleadings show, a friend could have recommended Underwood to fill in while he took a vacation or to help out with a late-summer surge in demand for trucking services.

“Nor is it clear whether an independent contractor is an ‘employee’ under the contract, and Underwood (for all we know) could have worked for the company in that capacity.

“Because the uncontested facts do not answer the question central to this case one undisputed way or the other, the case cannot be resolved on the pleadings,” said the appeals court, in reversing a ruling by the U.S. District Court in Nashville, Tennessee, and remanding the case for further proceedings.

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