Federal Register: October 5, 2005 (Volume 70, Number 192)
DOCID: FR Doc 05-19946
DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety Administration
CFR Citation: 49 CFR Part 387
Docket ID: [Docket No. FMCSA-2005-22470]
ACTION: Motor carrier safety standards:
DOCUMENT ACTION: Regulatory guidance.
Regulatory Guidance for Forms Used To Establish Minimum Levels of Financial Responsibility of Motor Carriers
EFFECTIVE DATES: October 5, 2005.
This document presents interpretive guidance material for the Federal Motor Carrier Safety Regulations (FMCSRs). FMCSA issues new regulatory guidance for Forms MCS90, MCS90B, MCS82, and MCS82B used to establish minimum levels of financial responsibility of motor carriers. The questions and answers are applicable to motor carrier operations on a national basis. This guidance will provide the motor carrier and financial services industries and Federal, State, and local law enforcement officials with a clearer understanding of the applicability in particular situations of Forms MCS90, MCS90B, MCS 82, and MCS82B contained in the FMCSRs.
Financial responsibility of motor carriers; forms used to establish minimum levels; guidance,
Basis for the Notice
FMCSA received a petition for rulemaking from several insurance
companies and the American Insurance Association to amend Form MCS90, Endorsement for Motor Carrier Policies
of Insurance for Public Liability, to incorporate several changes, most of which were suggested to clarify the meaning of Form MCS90. The Trucking Industry Defense Association (TIDA) filed a brief in support of the petition. A copy of the petition, amendments to the petition and the TIDA brief are in the docket identified in the heading of this document. The petitioners contended changes were necessary in light of Federal and State court decisions \1\ that they claimed misconstrued Form MCS90 to require insurance companies to pay damages for negligent operation of a vehicle owned by the insured motor carrier but not covered by its insurance policy, even when no judgment had been obtained against the insured motor carrier. The Petitioners' primary concern was to have the agency clarify that the word ``insured'' in the Form MCS90 means ``named insured.''
\1\ John Deere Insurance Co. v. Nueva, 229 F.3d 853 (9th Cir. 2000); Lynch v. Yob, 95 Ohio St. 3d 441, 768 NE. 2d 1158 (2002); Pierre v. Providence Wash. Ins. Co., 286 A.D.2d 139, 730 N.Y.S.2d 550 (2001); and Madere v. National Union Fire Ins. Co. of
Pittsburgh, 2000 U.S. Dist. LEXIS 15994 (E.D. La. 2000).
FMCSA has denied the petition for rulemaking. However, the agency
stated petitioners' concerns could be adequately addressed without
rulemaking through formal agency guidance to be published in the
Federal Register. A copy of the letter denying the petition is in the docket identified in the heading of this document.
FMCSA Authorities Over Motor Carrier Financial Responsibility Requirements
Section 30 of the Motor Carrier Act of 1980 (Pub. L. 96296, July 1, 1980, 94 Stat. 793, at 820), codified at 49 U.S.C. 31139, established minimum levels of financial responsibility for forhire motor carriers of property involved in interstate or foreign transportation and for the transportation of hazardous materials in intrastate and interstate commerce.
Section 18 of the Bus Regulatory Reform Act of 1982 (Pub. L. 97 261, September 20, 1982, 96 Stat. 1102), codified at 49 U.S.C. 31138, established minimum levels of financial responsibility covering public liability and property damage for the transportation of passengers by forhire motor carriers in interstate or foreign commerce.
The financial responsibility provisions of the Motor Carrier Act of 1980 and the Bus Regulatory Reform Act of 1982 were intended to create incentives for the motor carrier industry to focus on the safety aspects of highway transportation and to assure the general public that a motor carrier maintains an adequate level of financial responsibility sufficient to satisfy claims covering public liability, property damage liability and, in the case of transporters of hazardous materials, environmental restoration liability.
The Administrator of FMCSA has been delegated authority, under 49 CFR 1.73(f), to carry out the functions vested in the Secretary of Transportation relating to financial responsibility requirements for motor carriers, brokers and freight forwarders. Such functions include issuing regulations implementing 49 U.S.C. 31138 and 31139 and providing guidance regarding statutory or regulatory requirements.
This document provides regulatory guidance to the petitioners and the public with respect to the proper interpretation of Form MCS90. FMCSA is including Forms MCS90B, MCS82, and MCS82B in this regulatory guidance as well, because the same issue may arise with respect to these forms. Forms MCS90, MCS90B, MCS82, and MCS82B are not intended, and do not purport, to require insurance companies or sureties to satisfy a judgment against any party other than the motor carrier named in the endorsement or its fiduciary.
Members of the motor carrier industry and other interested parties may also access the guidance in this document through the FMCSA's Internet site at http://www.fmcsa.dot.gov.
Specific questions addressing any of the interpretive material
published in this document should be directed to the contact person
listed earlier under FOR FURTHER INFORMATION CONTACT, or the FMCSA Division Office in each State.
PART 387MINIMUM LEVELS OF FINANCIAL RESPONSIBILITY FOR MOTOR CARRIERS
Section 387.15 Forms
Question: Does the term ``insured,'' as used on Form MCS90, Endorsement for Motor Carrier Policies of Insurance for Public Liability, or ``Principal'', as used on Form MCS82, Motor Carrier Liability Surety Bond, mean the motor carrier named in the endorsement or surety bond?
Guidance: Yes. Under 49 CFR 387.5, ``insured and principal'' is defined as ``the motor carrier named in the policy of insurance, surety bond, endorsement, or notice of cancellation, and also the fiduciary of such motor carrier.'' Form MCS90 and Form MCS82 are not intended, and do not purport, to require a motor carrier's insurer or surety to satisfy a judgment against any party other than the carrier named in the endorsement or surety bond or its fiduciary.
Section 387.39 Forms
Question: Does the term ``insured,'' as used on Form MCS90B, Endorsement for Motor Carrier Policies of Insurance for Public Liability, or ``Principal'', as used on Form MCS82B, Motor Carrier Public Liability Surety Bond, mean the motor carrier named in the endorsement or surety bond?
Guidance: Yes. Under 49 CFR 387.29, ``insured and principal'' is
defined as ``the motor carrier named in the policy of insurance, surety
bond, endorsement, or notice of cancellation, and also the fiduciary of
such motor carrier.'' Form MCS90B and Form MCS82B are not intended,
and do not purport, to require a motor carrier's insurer or surety to
satisfy a judgment against any party other than the carrier named in the endorsement or surety bond or its fiduciary.
Issued on: September 28, 2005.
Annette M. Sandberg,
[FR Doc. 0519946 Filed 10405; 8:45 am]
BILLING CODE 4910EXP
FOR FURTHER INFORMATION CONTACT
Ms. Joy Dunlap, Chief, Commercial Enforcement Division, Office of Enforcement and Compliance (MCECC), Federal Motor Carrier Safety Administration, 400 Seventh Street. SW., Washington, DC 20590. Phone 2023852400. Office hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, except Federal legal holidays.