As I have stated in other posts, I have been kicking around the idea of buying and leasing out a trailer. My question is, would it be worth it with only one trailer to form an LLC?

The other question is this: Hypothetical situation-Lets say I lease trailer to a driver who owns his own truck and god forbid he is involved in a major accident which severely injures or possibly kills someone. During the investigation it is found that trailer had out of adjustment brakes or some other malfunction that caused the accident. Suppose I had documentation of DOT inspections, PM's, and any other work done on that trailer, but driver missed something crucial during pre-trip or did not report it. Am I likely to be held liable since I am the owner or would it fall to the driver since it is their responsibility to ensure they are operating a safe vehicle. I would think it is drivers responsibility, but lawyers can accomplish many things. Your thoughts would be appreciated.

 

I think this question would be best answered by an attorney, preferably one who specializes in transportation law. You may check with Opie on TN. You could also contact OOIDA. A local attorney would be your best choice.

 

I think the most expensive lawyer would win in this situation and I'm sure they would go after you and not the driver since you have the most insurance.

 

Most of the time you should be covered by the carrier's insurance. To qualify for motor carrier authority, the carrier must carry a minimum amount of liability insurance. That should cover you should anything happen, however, when there is an accident lawyers tend to sue any and everyone and settle with who has the deeper pockets. If you do lease the trailer, you may want to make sure that you are protected with adequate insurance and that the lessee assumes all liability for maintenance and insurance. You could always require specific maintenance checks. Most carrier's will have their leased equipment DOT inspected at least once a year. With older equipment, some are not requiring inspections every 3-6 months. I would say that your greatest liability lies in someone abusing the equipment, not taking care of maintenance or theft rather than an accident. You will probably want to carry collision insurance in case of damage to the trailer.

 

no question you are responsible
the driver is going to blame you too.

here's the deal

I own a 94 great dane reefer for a year now.
I have sunk quite a bit of money into it to lessen the chances of malfunction.
I have replaced so far:
all the brake chambers
brakes,drums
slacks
rebushed cams
2 tires
1/2 of the hoses
still to be done
shocks
airbags(if I decide to keep it longer)
rebuild all air valves before winter

thats just the box.
any truck can pass a dot inspection
but there are so many parts to wear out on an old unit
did you ever see a trailer loose its duals?
why did that happen?
are you going to pull every wheel and change the bearings and seals?
are you going to pull the wheels and inspect each rim and lug nut?

the only way to protect yourself is to spend $$$$$$$ to avoid the accident to begin with.
and it becomes quite pricey.
so you take some calculated risks on maint
if you are the driver /owner you are up on the quirks of the unit.
but if you are renting it out, that driver will run that leaky seal until the cows come home and if it gets dry?
"they gave me a trailer with a bad seal,your Honor"

 

Thanks for the responses,so what do you think about the first question about the LLC. I would think this would give me a little more protection.

 

Teamster, when you lease this equipment you will have a lease agreement that the lessee must carry in the vehicle. You can specify in the lease who is responsible for maintaining the equipment. I also agree with the poster that said the most expensive lawyer may win.

 

even if the lease says who is responsible for maintenance. You will still go to court. The llc will not protect you neither will an inc. You as an individual are to close to the equipment. Its just you and the trailer no legal entity can separate you.
eg
Judge "who is the head of maintenance in your co?"
"er I guess me your honor"
who is in charge of renting out the trailer?
"er I guess me your honor"
who is in charge to make sure that the trailer is properly maintained?
"well you see I have a paper,the renter is supposed to check......"
I ask you again who is the head of maintenance in your co?
"me your honor"
If the trailers brakes freeze up in -0 weather and you get slammed in the rear, you better call a lawyer.
you are still the owner and it could be your fault for leasing a trailer to someone who is a bad pre trip inspector.

 

I personally wouldn't want to loose sleep at night wondering who would bear the brunt of the lawsuit, for a few extra bucks. I would check with my insurance carrier and join OOIDA if you haven't yet, they can give you sound advice.
Get everything IN WRITTING.

 

That's why you have liability insurance. To cover these things.