Iowa House raises trucker liability caps to $5 million

By: - March 28, 2023 4:34 pm

The Iowa House sent trucking liability legislation back to the Senate Tuesday with a higher noneconomic damages cap and fewer limits on employer liability for their role in negligent hiring. (Photo via Canva)

The Iowa House sent trucking liability legislation back to the Senate Tuesday with a higher noneconomic damages cap and fewer limits on employer liability than originally proposed.

The changes adopted to Senate File 228 represent a compromise reached through weeks of discussion with trucking companies, victims and legal advocates, Rep. Bill Gustoff, R-Des Moines said.

“What we have before us is the result of a great deal of work by disputing parties, or disparate parties, in this matter,” Gustoff said. “I think we’ve reached a reasonable limit on noneconomic damages and liability exposure, while still allowing plaintiffs in commercial vehicle accidents to pursue their remedies and be made whole.”

The amended version of the bill, passed 58-42, would raise the cap on noneconomic damages in commercial motor vehicle accidents from the Senate’s $2 million cap to $5 million, with adjustments starting in 2028 for inflation based on the Consumer Price Index. In addition to the liability cap, it limits the scope of employer liability to “respondent superior” — legal doctrine that states an employer is responsible for the actions of its employees performed while working.

These changes, as well as the exceptions that remove caps for cases such as drunk driving accidents, means this is a compromise is fair for both plaintiffs seeking compensation for accidents and commercial vehicle owners who say “nuclear” verdicts and growing insurance costs are driving their companies out of business, Gustoff said.

Even with the higher cap and changes made, opponents from both parties still argued it was immoral for the government to place a cost on the value of human life through liability limits. Rep. Megan Jones, R-Sioux Rapids, shared a story of a great aunt killed in an accident with four others when their vehicle crashed into a semi-truck parked in the middle of a highway without its lights on at night.

While her family did not sue because of that accident, Jones said she could not support infringing other families’ right to pursue legal recourse in these incidents.

“Iowans aren’t looking to get run down by semi trucks,” Jones said. “Lawyers aren’t taking risky, frivolous cases. Iowa juries aren’t awarding more than a person deserves. And here’s the thing: I’m not here to tell Iowa families what to do, to judge their damages or limit their resolve. I believe and trust in Iowans to make the best decisions for themselves and for their families.”

Rep. Jon Dunwell, R-Newton, also shared a personal experience in a truck accident. Dunwell said he was grateful that his accident was with a commercial motor vehicle and not a personal one, because of the higher insurance and assets required. But he said he’s still in support of putting trucking liability limits in place because of the larger economic context in which these lawsuits take place.

“We’re living during a period of time where we have almost 9% inflation for the last couple of years. Families are struggling,” Dunwell said. “… I recognize the importance and the value of the tort system. But I want to also make sure it has some boundaries on it because of the expense for American families.”

Industry lobbyists told lawmakers in subcommittee meetings about jury verdicts that put trucking companies out of business. Chairman of the Iowa Motor Truck Association Sen. Adrian Dickey, R-Packwood, told his colleagues during floor debate on the bill that critics’ claims that these cases don’t happen in Iowa are not true.

The need for limits to combat high-cost jury awards and stabilize insurance prices also came up in debates over caps for medical malpractice cases, which Gov. Kim Reynolds signed into law in February. Opponents said both liability limit measures take power away from Iowa juries and devalue victims’ lives.

Rep. Charley Thomson, R-Charles City, said limiting noneconomic damages does not interfere with juries’ ability to make a decision in personal injury lawsuits. It’s in the best interest of all Iowans to have “stability in our court systems, stability in risk allocation, and encourage the creation of wealth on all sides,” he said.

“The nature of the tort system is not to right every wrong,” Thomson said. “And as we’ve heard throughout the discussion of (medical malpractice) and torts generally, bad things happen to good people. Just terrible, awful things happen. The jury system, the tort system, is not designed to remedy those. The jury system allocates fault, allocates damages for wrongful conduct. That’s big difference.”

The Senate must approve changes made by the House before the bill heads to Reynolds’ desk.

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Robin Opsahl
Robin Opsahl

Robin Opsahl is an Iowa Capital Dispatch reporter covering the state Legislature and politics. They have experience covering government, elections and more at media organizations including Roll Call, the Sacramento Bee and the Wausau Daily Herald.