Tort Reform Coming To Iowa

Tort Reform Coming To Iowa

It is anticipated Iowa Governor Kim Reynolds will sign into law a bill significantly affecting tort liability against trucking companies. The Bill, Senate File 228, was passed by the Iowa State Senate on Monday April 17, 2023 following its passage in the State House on March 28, 2023. If signed into law as anticipated, the Bill will cap the amount of non-economic damages in trucking cases to $5M per plaintiff and eliminate liability for negligent hiring claims if agency/course and scope of employment is stipulated.

Though the Bill generally limits non-economic damages to $5M per plaintiff, the caps will not apply if a plaintiff proves any of the following:

• The truck driver was operating under the influence of drugs or alcohol.
• The truck driver refuses to submit to a drug or alcohol test when required under Iowa’s law on operating while intoxicated.
• The truck driver committed a felony involving the use of the motor vehicle.
• The truck driver was involved in the transportation of unlawfully manufactured or distributed controlled substances.
• The truck driver was driving without a proper commercial driver’s license or driving with a revoked or suspended license.
• The truck driver was driving a vehicle involved in human trafficking.
• The truck driver was driving recklessly.
• The truck driver was using a device such as a phone while driving.
• The truck was going 15 m.p.h. or more over the speed limit.
• The truck did not require a driver to possess a commercial driver’s license.

Should the Bill become law, it will also bar plaintiffs from asserting negligent hiring claims against trucking companies if the trucking company stipulates that the driver was an employee and acting in the course and scope of his employment at the time of the alleged negligent conduct. Notably, the Bill is silent on direct negligence claims for negligent entrustment, retention, supervision, training, etc.

Readers should be aware that the above-legislation does not apply to situations involving common carriers of passengers or commercial motor vehicles being used to transport passengers.

Overall, this legislation should protect trucking companies from unreasonable and runaway verdicts, and bring predictability to costs in the insurance industry.

We will continue to monitor whether Governor Kim Reynolds signs this legislation, and we will continue reporting on similar trends throughout the country.