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Downstream Liability: Myths versus Reality

February 21st, 2017 by Howard Skolnik

Filed under: Associations, HazMat, Safety, Skolnik Newsletter

Some persons in corporate management believe that outsourcing the corporate transportation function will help to insulate the company from liability in the event of a motor carrier accident or a hazardous materials incident. This is not necessarily true — outsourcing to third parties does not necessarily eliminate or mitigate this risk. Outsourcing transportation to a for-hire motor carrier (or an intermediary such as a broker or freight forwarder) does change the target of due diligence from private fleet drivers to the third party transportation provider, but it does not eliminate the shipper’s responsibility for investigating the person or company that will be transporting their goods, performing their pre- and post-transportation functions adequately, or even supervising their carrier’s performance. But the aggressive exercise of management over carrier practices could also provide evidence that the shipper is responsible for the carrier’s negligent acts or omissions. Ultimately, shippers must balance the need to control their transportation service and the acceptance of a certain degree of liability for injuries caused by transportation operations.

To further investigate these liabilities, Richard (Rick) Schweitzer, General Counsel to the Council on the Safe Transportation of Hazardous Articles (COSTHA), and General Counsel to Skolnik Industries, has prepared a paper entitled Downstream Liability: Myths Versus Reality. This paper deals with civil liability for incidents or collisions that cause personal injuries or death and that occur in the stream of commercial motor vehicle transportation. View the entire paper here.

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