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7th Circuit: Drivers not entitled to ‘special services’ profit

June 2, 2016

Truck drivers are not entitled to profits from any “special services” a company they drive for provides, the 7th Circuit Court of Appeals affirmed Wednesday, because the language supporting such a claim isn’t in the contract.

Trailer Transit contracts with shippers for the movement of cargo and then drivers for transportation. The language of the contract between the drivers and Trailer Transit states the company shall pay “a sum equal to 71 percent of the gross revenues derived from use of the equipment leased herein” less any special services such as permits, escort service for overwide loads and other special administrative costs.  

The drivers contended only items provided at cost, which also include licenses and flashing lights, can be classified as special services, and if Trailer Transit makes a profit on those transactions, the drivers should be entitled to 71 percent of that profit. However, the District Court in Indianapolis refuted that argument because “it amounts to saying that the Drivers are entitled to 71% of the gross revenue on the principal charge for transportation (which Trailer Transit bills at a price per mile) and 71% of the net revenue on everything else.”

That is not the case, Circuit Judge Frank Easterbrook wrote for the panel. The contract does not provide a share of Trailer Transit’s profit on any other part of the bill other than charge for use of the equipment, the drivers’ rigs.

Easterbrook wrote “reimburse” in the contract could have different meanings, including to compensate or pay, but in the context of the contract, it doesn’t mean that. “If the contract had said ‘reimburse the expense of’ special services, that would limit the word’s meaning to recovery of actual costs. But those words aren’t in the contract,” Easterbrook wrote.

A better line of argument would have been that parties cannot take opportunistic advantage of contractual commitments, but the drivers’ lawyer said that it is not what they are arguing. They claim they are entitled to a slice of any net profit on special services, but the contract provides no basis for that, Easterbrook wrote.

The case is Hubert E. Walker, on behalf of himself and a class v. Trailer Transit Inc., 15-1482.
 

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