A bill in the New Jersey Senate to address unfair clauses in trucking contracts has taken the first step toward passage.
The Senate Transportation Committee voted unanimously to advance a bill to do away with indemnification clauses in trucking contracts. The clauses are set up to protect shippers or hold them harmless from anything that happens with a shipment.
Sponsored by Sen. Peter Barnes, D-Middlesex, the bill would outlaw provisions in contracts that provide for shippers to be indemnified for losses caused by their own negligence and make them “void and unenforceable.”
The Owner-Operator Independent Drivers Association supports the legislative push.
Mike Matousek, OOIDA’s director of state legislative affairs, has called the legislation a reasonable and fair solution to address existing rules that essentially provide shippers and receivers with immunity from any damage caused by their negligence while a trucker is on their property.
“This is simply wrong, and truckers should not be held liable for the negligence of a shipper or receiver,” Matousek said. “Conversely, shippers and receivers should not be held liable for the negligence or a trucker.”
States lawmakers across the country have been active the past few years changing rules on indemnity clauses. To date, 42 states have acted to forbid unfair provisions from contracts. Arkansas acted in the past few weeks to prohibit the protection for shippers.
A full list of states, and the laws, where protections are in place is available. In addition to New Jersey, states that have yet to adopt protections are Delaware, Mississippi, New Hampshire, New York, Ohio, Rhode Island and Vermont.
Affected contracts in New Jersey would be defined as “a contract, agreement, or understanding” between a motor carrier and a shipper covering the transportation of property for hire by the motor carrier, entry on property to load, unload, or transport property, including the storage of property.
The bill, S1380, awaits consideration on the Senate floor. If approved there, it would move to the Assembly.
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