By Gallagher Sharp LLPOn September 27, 2023, Illinois’ First District Appellate Court reversed a judgment in the amount of $18,150,750 after determining that an agency relationship did not exist between the freight broker and motor carrier so that the freight broker would be vicariously liable for the driver/motor carrier’s negligence. See Cornejo v. Alliance Shippers, Inc., 2023 IL App (1st) 220633 (Sept. 27, 2023).
In Cornejo, the plaintiff’s son was severely injured when struck by a tractor-trailer on the shoulder of a highway and his mother filed suit against the truck driver, the motor carrier, and the freight broker. The case was tried to verdict and the jury found that the truck driver and motor carrier were negligent. The jury also determined that the motor carrier was an agent of the freight broker, and thus, the trial court entered judgment in the amount of $18,150,750 against the truck driver, motor carrier, and freight broker under vicarious liability principles.
On appeal, the freight broker argued that the motor carrier was an independent contractor and neither the motor carrier nor the driver, were its agents so that it should be vicariously liable for their negligence.
The First District Appellate Court agreed with the freight broker and reversed the judgment finding that, as a matter of law, the freight broker did not exercise sufficient control over the manner of the motor carrier/driver’s work so that a principal-agent relationship was created. In support of its ruling, the appellate court noted that: the freight broker did not pay the motor carrier’s drivers or withhold taxes from their pay; the freight broker did not hire, train, or fire the drivers; the freight broker did not dispatch or speak to the drivers; the freight broker did not control the drivers’ routes or provide them with tools, equipment, or materials; and the freight broker did not own the tractors or trailers the drivers used. Additionally, the broker-carrier agreement provided that the motor carrier had full control over its personnel and would perform services as an independent contractor.
The appellate court also noted that its decision did not deviate from its previous ruling in Sperl v. C.H. Robinson Worldwide, Inc., 408 Ill. App. 3d 1051 (2011), because in that case, the freight broker exercised a high degree of control over the motor carrier as it directly hired, paid, and dispatched the driver, directed delivery to the freight broker’s own warehouse, specified the trailer length, required the driver to take the trailer temperature regularly, required the driver to stay in constant communication with the broker, and imposed fines for late deliveries.
The decision in Cornejo is consequential as it supports traditional independent contractor principles and can help support a freight broker’s defense against claims of agency and vicarious liability. Freight brokers should continue to pay careful attention to all aspects of “control” they may exercise over motor carriers and drivers to avoid inferences of an agency relationship.
Please contact Rob Boroff or Devin Bembnister if you have any questions.