Great West Casualty v. Cobra Trucking and Sieler-Rohr

INSURANCE: Owner/operator’s load not excluded from contractor trucking company’s policy as brokered load… death crash covered… Cebull.

Randall Dwyer was driving a semi from Roundup to Casper on Hwy 191 8/3/11 after delivering fracking sand for Cobra Trucking. He crossed the centerline north of Billings and struck a vehicle, killing Frank Rohr and severely injuring his wife Alice and their infant son. Alice is seeking recovery under Cobra’s Great West policy. Dwyer had hauled 16 loads of sand for Cobra 6/18/11-8/3/11. Cobra was under contract with Halliburton and other well service companies. It did not have enough employees, tractors, or trailers to handle all loads available, and contracted with owner/operators including Dwyer, who had his own DOT number and liability insurance. Cobra offered loads as they became available to drivers at the top of a list. Once a driver accepted a load he was obligated to pick it up in Casper. Cobra employees assisted in loading and completed a bill of lading listing Cobra as the carrier. The Great West policy stated that “Liability Coverage shall not apply to transportation broker or freight forwarder operations of the `insured’.” Great West seeks summary judgment that it has no duty to defend or indemnify Cobra for the Dwyer/Rohr accident.

Great West argues that “brokerage operations” can be conducted without a party acting as a “broker.” This is not logical. “Broker operations” is not defined in the policy. 49 CFR 371.2(a) states:

“Brokerage” or “brokerage service” is the arranging of transportation or the physical movement of a motor vehicle or of property. It can be performed on behalf of a motor carrier, consignor, or consignee.

“Broker” means a person who, for compensation, arranges, or offers to arrange, the transportation of property by an authorized motor carrier. Motor carriers, or persons who are employees or bona fide agents of carriers, are not brokers within the meaning of this section when they arrange or offer to arrange the transportation of shipments which they are authorized to transport and which they have accepted and legally bound themselves to transport.

Great West argues that 371.2(c) authorizes a carrier to act as a transportation broker. However, §371.2(a) states that a carrier is not a broker if it is arranging transportation for shipments that the carrier is legally bound to transport. Cobra was legally obligated to transport the sand in Dwyer’s truck 8/3/11, based on its contractual relationship with Halliburton. Dwyer did not have a contract with Halliburton. Even Cobra Pres. Donald Hollandworth confirmed that Dwyer’s load was not a brokered load. The bill of lading listing Cobra as the carrier is further confirmation of its contractual obligation with Halliburton to transport the load. Cobra was not acting as a broker and its dealings with Dwyer were not “brokerage operations” under the policy exclusion.

Further, given that the policy does not define “broker operations,” the Court could certainly find the term to be ambiguous and construe it against Great West.

Summary judgment for Alice.

Great West Casualty v. Cobra Trucking and Sieler-Rohr, 40 MFR 195, 2/4/13.

Brian Smith & Katy Mahe (Garlington, Lohn & Robinson), Missoula, for Great West; James Ragain (Ragain Law Firm), Billings, for Cobra; Torger Oaas (Oaas Law), Lewistown, and Kris Birdwell (Stogsdill Law Office, Lewistown, for Alice.