REMARKS – The MCS-90 endorsement mandated by the Motor Carrier Act held not to require issuer of that endorsement to pay out to another insurance company – in light of MCS-90’s design that was to protect an “injured member of the public” harmed by “negligent authorized interstate [motor] carriers”. It simply does not apply “between two or more insurance companies”. COMMENT: At some point the federal court systems will need to resolve this question about application of MCS-90 as between two or more insurance companies. The law is unsettled in the various jurisdictions – including as interpreted by federal and state courts.

Carolina Casualty Insurance Co. v. Canal Insurance Co., Case No. 2:11-cv-736 (U.S. District Court for the Southern District of Ohio, April 18, 2013). Free copy from the court available here.

Legal Take-Away:

Application of MCS-90 to cases between two or more insurance companies is unsettled in the law.

Practical Take-Away:

Until law is resolved on the application of MCS-90 to cases between two or more insurance companies, counsel for insurance carriers (1) should assume for planning purposes that MCS-90 will not apply to such circumstances, and (2) should always – in the context of an accident case presenting this situation – explore the possibility of making a good faith claim for recovery in such circumstances unless and until the law is settled to say otherwise.