Content area
Full Text
Motor truck cargo (MTC) liability insurance is intended to provide legal liability coverage for truckers (common or contract carriers) while they are transporting property of others (cargo). Under this coverage the insured is the trucker and the covered property is the property of others that is being transported by the insured. The trucker is liable for cargo under the terms of a bill of lading (common carrier) or a contract with the shipper (contract carrier).
A common carrier is one that offers its services to the general public. It may haul cargo intrastate or interstate, depending on its authorized operating scope. A contract carrier is one that hauls for a specific shipper under the terms of a negotiated contract. The service is not available to the general public. Carriers are now permitted to offer their services as both a common and a contract carrier.
The legal liability imposed on these two types of motor carriers differs in extent. Generally, a common carrier is responsible for the safe delivery of the goods it is transporting and thus owes a very high degree of care. This level of legal liability can be referred to as "strict liability" or liability without fault. However, several defenses are available to a common carrier. They are:
1. act of God;
2. public enemy;
3. inherent vice;
4. act or fault of the shipper; and
5. public authority.
The act of God defense may become available to the motor carrier when the loss is caused by a storm or other natural event that could not be anticipated. If, for example, the driver has warning of flooding conditions in a particular area and, in his/her haste to deliver the goods, drives into the area anyway, it is unlikely the defense will be available.
Public enemy refers to warlike actions or political strife against the nation.
Inherent vice refers to loss emanating from within the cargo itself; for example, wine sours in transit without some external cause such as extreme heat or cold.
Act or fault of the shipper is probably the most commonly used defense. Negligent or careless packaging by the shipper is an example.
The public authority defense is rarely available. It could involve a drug bust by U.S. Customs or...