Transportation Executive Summary: Iowa Adopts Tort Reform Regarding Commercial Motor Vehicles
Recently, the Governor signed into law Senate File 228 which addressed “employer liability and damages in civil actions involving commercial motor vehicles.” While the “caps” on damages received the most media attention, another provision of the Act relates to claims for negligent hiring. This article will review the provisions of the Act.
The Act adopted a new Code section (668.12A) about negligent hiring claims. Now in a civil action involving the claims against the employer of a person who operates a commercial motor vehicle, the cause of action shall be based “solely on respondeat superior” and not claims based upon negligent “hiring, training, supervising, or trusting the employee” provided that the employer complies with the balance of the Code section. SF. 228, section 1(1).
The employer must, however, stipulate “that at the time of the event that caused the damages that are the subject of the civil action that the person" who was negligent “was acting within the course and scope of employment with the employer.” SF. 228, section 1(2).
With respect to non-economic damages, the Act adopted a new Code section 668.15A. The gravamen of the section is that non-economic damages are capped at $5,000,000.00. SF. 228, section 2(2). “Noneconomic damages” means those damages “arising from pain, suffering, inconvenience, physical impairment, mental anguish, emotional pain and suffering, loss of chance, loss of consortium, or any other nonpecuniary damages.” SF. 228, section 2(1)(c).
Note that the Act does provide certain exceptions if certain facts are found by the trial court (not the jury). SF. 228, section 2(3). The Act’s damage limitations do not apply to operation of a motor vehicle that does not require a commercial driver’s license. SF. 228, section 2(4)(a). Although, the Act appears to exempt from the damage cap those commercial motor vehicles which transport passengers or school busses. SF. 228, section 2(4)(b).
The damage cap is set to be adjusted each year based upon inflation. SF. 228, section 2(5). This information shall be certified and published by the Iowa Secretary of State. SF. 228, section 2(5).
Corresponding changes were made to Iowa Code Chapter 668A regarding punitive damages. SF. 228, section 3.
The Act would appear to go into effect July 1, 2023.
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Contact John F. Fatino for more information about trucking and transportation matters at 515-288-6041.