The United States Court of Appeals for the Eighth Circuit confronted a case of first impression and decided that the MCS-90 endorsement for motor carriers requires a tortfeasor’s insurer to compensate an injured party even if the injured party has already been compensated by its own insurer. More to the point, the Eighth Circuit allowed a subrogor to pursue relief against a tortfeasor’s insurer in accordance with the MCS-90 endorsement.
As background, a semi-tractor and trailer operated by Yelder collided with a Tri-National truck, causing property damage. Tri-National’s insurer, Harco Insurance Company, paid the claim and retained the subrogation interest. Tri-National sued Yelder and obtained a default judgment. Tri-National, on behalf of Harco, then filed in Missouri state court an equitable garnishment action against Canal Insurance Company, Yelder’s insurer. Following removal of the action to federal court, and upon cross-motions for summary judgment, the district court ruled in favor of Tri-National. Canal appealed.
On appeal, the Eighth Circuit held that even though the MCS-90 endorsement generally does not apply where other insurance policies are available to fully compensate the victim for its injuries, it would be against public policy to let Canal off the hook. The court explained that it would not eliminate the protection afforded victims by the Motor Carrier Act against negligent tortfeasors simply because the victims “prudently carry their own insurance.” According to the court, this would defeat the purpose of the Motor Carrier Act, which is to “assure the injured members of the public … [the ability] to obtain judgments collectible against negligent authorized carriers.” Further, the Eighth Circuit reasoned that its interpretation would encourage the victims’ carriers, like Harco, to promptly satisfy the claim and compensate the victim.
How does your jurisdiction approach the MCS-90 Endorsement? Does it similarly take a broad or liberal view of this protection?