Bill S1087-2013

Proscribes indemnity agreements in motor carrier transportation contracts

Proscribes indemnity agreements in motor carrier transportation contracts.

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  • Jan 8, 2014: REFERRED TO TRANSPORTATION
  • Jan 9, 2013: REFERRED TO TRANSPORTATION

Memo

BILL NUMBER:S1087

TITLE OF BILL: An act to amend the transportation law, in relation to proscribing indemnity agreements in motor carrier transportation contracts

PURPOSE OF GENERAL IDEA OF BILL: Article 8 of the Transportation Law is amended by adding Section 182, This section will prohibit the use of indemnification clauses in contracts between shippers and common earners.

SUMMARY OF SPECIFIC PROVISIONS: Section 182(1)(a) defines "motor carrier transportation contract. Section 182(1)(b) defines "promisee". Section 182(2) makes any contract that purports to indemnify, defend or hold harmless, or has the effect of indemnifying, defending or holding harmless, the promisee from or against any liability for loss or damage resulting from the negligence or intentional acts or omissions of the promisee; is against the public policy of this state and is void and unenforceable.

JUSTIFICATION: Current law does not prohibit a shipper from including indemnification language in the contract between the shipper and motor carrier. The indemnification absolves the shipper of all liability for damage to goods regardless of fault. For example, if a shipment of produce is damaged in the warehouse because it was kept there too long, it is the responsibility of trucking company because of the indemnification provision in the contract.

Because indemnification language is commonly included in contracts,. motor carriers have no choice but to accept the terms. Twenty-five states (thirteen of them in the past two years) have passed similar legislation to address this growing problem.

This legislation will not limit anyone's ability to collect for damaged goods but will simply hold the responsible party liable.

PRIOR LEGISLATIVE HISTORY: S4843/A8254 of 2011-12; Referred to Transportation

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: Immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 1087 2013-2014 Regular Sessions IN SENATE (PREFILED) January 9, 2013 ___________
Introduced by Sen. MAZIARZ -- read twice and ordered printed, and when printed to be committed to the Committee on Transportation AN ACT to amend the transportation law, in relation to proscribing indemnity agreements in motor carrier transportation contracts THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. The transportation law is amended by adding a new section 182 to read as follows: S 182. INDEMNITY PROVISION IN MOTOR CARRIER TRANSPORTATION CONTRACTS. 1. FOR THE PURPOSES OF THIS SECTION: (A) "MOTOR CARRIER TRANSPORTATION CONTRACT" MEANS A CONTRACT, AGREE- MENT OR UNDERSTANDING COVERING: (I) THE TRANSPORTATION OF PROPERTY FOR COMPENSATION OR HIRE BY THE MOTOR CARRIER; (II) ENTRANCE ON PROPERTY BY THE MOTOR CARRIER FOR THE PURPOSE OF LOADING, UNLOADING OR TRANSPORTING PROPERTY FOR COMPENSATION OR HIRE; OR (III) A SERVICE INCIDENTAL TO ACTIVITY DESCRIBED IN SUBPARAGRAPH (I) OR (II) OF THIS PARAGRAPH, INCLUDING, BUT NOT LIMITED TO, STORAGE OF PROPERTY. (B) "PROMISEE" MEANS THE PROMISEE AND ANY AGENTS, EMPLOYEES, SERVANTS OR INDEPENDENT CONTRACTORS WHO ARE DIRECTLY RESPONSIBLE TO THE PROMISEE EXCEPT FOR MOTOR CARRIERS PARTY TO A MOTOR CARRIER TRANSPORTATION CONTRACT WITH THE PROMISEE AND SUCH MOTOR CARRIER'S AGENTS, EMPLOYEES, SERVANTS OR INDEPENDENT CONTRACTORS DIRECTLY RESPONSIBLE TO SUCH MOTOR CARRIER. 2. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, A PROVISION, CLAUSE OR AGREEMENT CONTAINED IN, COLLATERAL TO OR AFFECTING A MOTOR CARRIER TRANSPORTATION CONTRACT THAT PURPORTS TO INDEMNIFY, DEFEND OR HOLD HARMLESS, OR HAS THE EFFECT OF INDEMNIFYING, DEFENDING OR HOLDING HARMLESS, THE PROMISEE FROM OR AGAINST ANY LIABILITY FOR LOSS OR DAMAGE
RESULTING FROM THE NEGLIGENCE OR INTENTIONAL ACTS OR OMISSIONS OF THE PROMISEE IS AGAINST THE PUBLIC POLICY OF THIS STATE AND IS VOID AND UNENFORCEABLE. 3. "MOTOR CARRIER TRANSPORTATION CONTRACT," AS DEFINED IN THIS SECTION, SHALL NOT INCLUDE THE UNIFORM INTERMODAL INTERCHANGE AND FACIL- ITIES ACCESS AGREEMENT ADMINISTERED BY THE INTERMODAL ASSOCIATION OF NORTH AMERICA OR OTHER AGREEMENTS PROVIDING FOR THE INTERCHANGE, USE OR POSSESSION OF INTERMODAL CHASSIS, CONTAINERS OR OTHER INTERMODAL EQUIP- MENT. S 2. This act shall take effect immediately.

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