220_C135

MOTOR CARRIER SAFETY ACT PROVIDED AN IMPLIED CAUSE OF ACTION AGAINST TRUCK OWNER

Commercial Automobile

Doctrine of Collateral Estoppel

Motor Carrier Safety Act

Doctrine of Res Judicata

 

A tanker truck that contained liquefied petroleum gas (LPG) driven by an employee of North Central Cooperative LLC (North Central) apparently struck a guardrail. This caused the tanker to separate from the trailer, crash over a freeway overpass’ barriers, and fall to the road below. Upon impact, the tanker exploded and enveloped the road and overpass bridge in flames. This resulted in significant damage to the road and bridge. The Department of Transportation (DOT) paid almost $2 million to repair the damage.

 

DOT sued North Central’s insurer, Farmland Insurance Company (Farmland) under the no-fault act to recover the cost of repairs. DOT was awarded $658,138.11 in its action against Farmland. DOT then initiated this negligence action against North Central, contending that it was directly liable for the remaining damages. DOT also alleged that, to the extent that North Central might be immune to tort liability under the no-fault act, the no-fault act conflicted with and was preempted by 49 USC 5101 that governs transporting hazardous materials. North Central moved for summary disposition pursuant to MCR 2.116 (C) (8) and (10). The trial court granted the motion, noting the following:

 

Note: The Doctrine of Res Judicata is a rule that a final judgment rendered by a court of competent jurisdiction on the merits is conclusive as to the rights of the parties and constitutes an absolute ban to a subsequent action that involves the same claim, demand, or cause of action.

 

The trial court ruled that Farmland’s liability was limited to $1 million for all property damage that arose out of the incident. The recovery in this case was limited to $658,138.11 because Farmland had already paid $341,861.89 to other claimants from the accident. It granted summary judgment to North Central and DOT appealed.

 

DOT argued that, while the no-fault act might be read to abolish tort liability for automobile accidents as long as the owner maintains $1 million in insurance coverage, federal law requires that transporters of hazardous materials maintain at least $5 million of financial responsibility in order to satisfy any liability for property damage. DOT also contended that, to the extent that federal law controls under the Supremacy Clause, it pre-empts the no-fault act on this issue. DOT further asserted that adopting federal financial requirements for transporting hazardous materials in the Motor Carrier Safety Act abolished an exception to the no-fault act’s abolition of tort liability concerning transporters of hazardous materials.

 

Note: The Supremacy Clause is the provision in Article Six, Clause 2 of the United States Constitution. It establishes as “the supreme law of the land” the United States Constitution, U. S. treaties, and federal laws. These highest forms of law in the United States require all state judges to follow federal law when there is a conflict between any state’s laws or constitution and federal law.

 

The appellate court held the following:

 

Note: Under the Doctrine of Collateral Estoppel, a prior judgment between the same parties on a different cause of action is an estoppel as to those matters in issue or points controverted, on determination of which finding or verdict was rendered.

 

The appellate court reversed the trial court’s decision and remanded the case back to it for further proceedings consistent with this opinion. One justice dissented.

 

Court of Appeals of Michigan. Department of Transportation, Plaintiff–Appellant, v. North Central Cooperative LLC, Defendant–Appellee. Docket No. 268432. Submitted July 18, 2007, at Lansing. Decided Jan. 24, 2008, at 98:00 a.m. 277 Mich.App 633, 750 N.W.2d, 234