Now Oregon law provides indemnification protection

| Friday, June 03, 2011

A bill to address indemnification clauses has completed its trek through the Oregon Legislature.

Gov. John Kitzhaber signed into law a bill to make unenforceable any motor carrier contracts that provide for shippers to be indemnified for losses caused by their own negligence. The rule, which took effect immediately, applies only to contracts executed after May 27.

Oregon joins nearly 30 states that have acted to outlaw the provisions in contracts that protect shippers or hold them harmless from anything that happens with a shipment.

The Oregon law defines affected contracts as any written agreement for the transportation of property for compensation or hire; entry on property to load, unload or transport property; or any service incidental to such activity, including the packing or storage of property.

Joe Rajkovacz, OOIDA director of regulatory affairs, says the indemnification protection effectively prohibits a receiver from pre-conditioning unloading by attempting to require the motor carrier to obtain specific insurance coverage that many times is not commercially attainable.

Rajkovacz said the receiver often requires itself to be named as co-insured on a policy.

“This type of scam is often used by receivers to force motor carriers into paying for unloading services provided by the receiver – services from which they profit dramatically,” he said.

Rajkovacz said passage of SB259 is a major win for truckers doing business in Oregon.

To view other legislative activities of interest for Oregon, click here.

Editor’s Note: Please share your thoughts with us about the legislation included in this story. Comments may be sent to statelegislativedesk@ooida.com.

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