A Decision of Significance: The Illinois Appellate Court, First District, Grants a Shipping Broker JNOV on Appeal Holding That There Was No Vicarious Liability Relationship Between the Shipping Broker and the Broker’s Carrier and Driver

By Melinda S. Kollross

In personal injury litigation, liability usually follows the money, meaning that the plaintiff’s PI bar tries to stick it to the party that has the highest liability insurance limits. In Cornejo v. Dakota Lines, Inc., 2023 IL App (1st) 220633, the party with the most insurance was a shipping broker, Alliance Shippers, who had contracted with a carrier, Dakota Lines, to transport goods on behalf of one of the shipper’s clients. Dakota’s driver Lewis had a catastrophic accident and the jury awarded $18,150,750 plus $466,161.20 in prejudgment interest. Judgment was entered against Alliance Shippers, Dakota Lines and Lewis, but only Alliance Shippers appealed the judgment.

On appeal, the Appellate Court, First District, which hears appeals from judgments entered in Cook County, Illinois, took this nuclear verdict away from the plaintiff holding that Alliance was not vicariously liable for Lewis’s negligence, since neither Lewis nor Dakota were Alliance’s agents. The Court ruled that there were no facts from which a reasonable jury could find an agency relationship between Alliance and Dakota/Lewis.

The Court found significant that Alliance did not pay Dakota’s drivers and withhold taxes from their pay; hire, train or fire the drivers; dispatch or speak to the drivers; control the drivers’ routes or provide them with tools, equipment, or materials; or own the tractors or trailers the drivers used. Dakota hired, trained, and fired its drivers; paid them; and withheld taxes from their paychecks. The Court noted that it was undisputed that Dakota and Alliance adhered to the terms of their agreement, which provided that Dakota had full control over its personnel and would perform services as an independent contractor. Moreover, the Court found that Dakota and Alliance did not have an exclusive relationship; Dakota was free to haul freight for other brokers and was not Alliance’s primary carrier.