[Musicman]

Originally Posted by solo379

And they won't be disappointed, but first i should accept that run. Other wise i couldn't call myself owner operator. And IRS wouldn't think so either. BTW I practically never refuse the load cause of difficulty, only based on a profitability. That's my business after all, and i should be able to run it, as i see fit. I might help them in a bind, once in a while, but only as a favor.

I beg to differ with you on that one. Below is an excerpt from a sample lease from OOIDA. If you know anything about OOIDA you know they’d never write a contract that benefitted the carrier any more than absolutely necessary. Every lease I have ever seen or signed has included language that is similar to this as well:

Contractor is the owner of the equipment described in Appendix A to this Agreement and drives and/or will provide drivers fully qualified under all applicable federal and state laws to operate that equipment in interstate and/or intrastate commerce.

Carrier is in the business of offering and providing motor carrier services to the shipping public and desires to retain the equipment and driver services of Contractor to meet its transportation commitments. Carrier is authorized to conduct operations in interstate and/or intrastate commerce pursuant to operating authorities issued by the appropriate federal and state agencies.

Contractor desires to lease its equipment with a driver or drivers to Carrier, and Carrier desires to lease that equipment and driver(s) to meet its transportation requirements for its customers, and for good and lawful consideration, the parties agree as follows:

1. Copies of this Agreement. --- blah blah blah---
2. Receipts for Equipment --- blah blah blah--- Upon termination of this lease, or when possession by the Carrier of a unit of equipment identified in the addendum ends, the Carrier shall give Contractor a receipt evidencing the date and time of the [/B]return of the equipment to Contractor's control.[/B]
3. Exclusive Possession and Control by Carrier. Carrier shall have the exclusive possession, control and use of the equipment, and shall assume complete responsibility for the operation of the equipment, for the duration of the lease.

From the above except, we can clearly see that the leased on equipment is strictly under the control of the carrier, NOT the contractor. Additionally, the carrier’s stated goal “to lease that equipment and driver(s) to meet its transportation requirements for its customers couldn’t possibly be met it you are constantly picking and choosing where you will and will not go.

[Musicman]

Originally Posted by allan5oh

Most of these questions can be answered by obtaining a copy of the carrier/owner operator lease agreement. If they're not willing to show you it before you're ready to sign, run as fast as you can.

Amen to that! I've only had a few carriers try that on me, though.

[Musicman]

Originally Posted by Red Clay Rambler

I would add asking who pays cargo and liability insurance while under loads. Quite a few companies are now expecting (in contract) O/O's to pick up that cost, which I would never do.

Wow. I guess things have changed since I got my authority. If I’m paying the liability and cargo as a leased o/o then I need to see a higher rate of pay to cover it. Are they really getting many people to go for this?

[Musicman]

Originally Posted by GMAN

Where some get the owner operator is in all the little fees that they charge.

I had a company charge me $3.60 for a “fuel card fee” every time I fueled with their TCH card. A couple of years later, I am on my own and have my own TCH account and learn that the standard fee is $1.80 per use. So this company was making $1.80 off me every time I bought fuel. Now that doesn’t seem like much, but figure I bought fuel 6 times a week and they make $10.80. Now multiply that by a hundred trucks and they were making over a $1k a week just in excess fuel card fees. That’s a nice car payment for the owner of the company.

Originally Posted by GMAN

If an owner operator is expected to pay liability and cargo insurance he would be better off getting his own authority. If you are paying the full cost of insurance there is no need to give another carrier 25% or more of the revenue, depending on the type of freight hauled and whether the owner operator has his own trailer.

GMAN for you and me and some others this is certainly true. The problem is that probably over half (and maybe a heck of a lot more) of all leased on o/o aren’t business people. They think that because they know how to drive a truck that it qualifies them to go into business for themselves. These are the people who end up losing their truck when they blow a turbo and don’t have $2500 to fix it or can’t replace a blown tire without an advance from the carrier. How are these people going to survive when they have to pay for their fuel up front for three of four weeks before they ever see a penny from the loads they ran? Rates are so low that I don’t see how they can factor their loads to get fast operating cash and still pay the bills.

[solo379]

Originally Posted by Musicman

B]
3. Exclusive Possession and Control by Carrier. Carrier shall have the exclusive possession, control and use of the equipment, and shall assume complete responsibility for the operation of the equipment, for the duration of the lease.

I believe, you got it wrong. That's only after, and if, i accept the run. If i can't "pick and choose", i'm no more than a company driver on a leased truck. I'm INDEPENDENT contractor, after all.

[Musicman]

Originally Posted by solo379

I believe, you got it wrong. That's only after, and if, i accept the run. If i can't "pick and choose", i'm no more than a company driver on a leased truck. I'm INDEPENDENT contractor, after all.

Leases have a time period they are good for. Most are for one year. You can't say that this particular statement only applies to a situation where you have accepted a load. You are an independent contractor who has signed a contract to give exclusive operational control of your equipment and labor to another party for a specific period of time. There’s no way you could ever make this argument in court as they’d laugh you right out the door. I’ve never seen a standard lease that said you give to carrier control of your equipment and labor on a per load basis. The only situation that would fit the definition you’ve given would be a Trip Lease.

[Red Clay Rambler]

Originally Posted by Musicman

Wow. I guess things have changed since I got my authority. If I’m paying the liability and cargo as a leased o/o then I need to see a higher rate of pay to cover it. Are they really getting many people to go for this?

I don't know if anyone is accepting contracts with that stipulation, if so, my guess would be they are inexperienced and don't know any better, or desperate. Yes, some carriers who charge the O/O with cargo/liability are paying a higher percentage, but then the carrier has no reason to shop for insurance at the best rate. The O/O would theoretically be paying a premium based on the overall safety record of the carrier, I suppose, which could be horrible depending on accidents/violations. And I'm sure those carriers would be happy to provide you a copy of their declarations page/premium statements, to be sure they weren't "marking up" the cost on you. (Not)

[solo379]

Originally Posted by Musicman

Leases have a time period they are good for. Most are for one year.

Actually, i don't even remember, what's in mine. I've been leased to the same company for over 12 years. I do know tho, that my contract, could be canceled at any time, for any reason, by either party. No expiration date. And believe me, in those years, I've refused more than a few loads. But you've got my curiosity, and I'll post that example of lease agreement, on OOIDA forum for some explanations.

[Musicman]

Originally Posted by solo379

Actually, i don't even remember, what's in mine. I've been leased to the same company for over 12 years. I do know tho, that my contract, could be canceled at any time, for any reason, by either party. No expiration date. And believe me, in those years, I've refused more than a few loads. But you've got my curiosity, and I'll post that example of lease agreement, on OOIDA forum for some explanations.

Most leases read that they are for a period of one year and will be automatically renewed unless one party or the other makes it known in writing to the other party that it is not to be renewed. Every lease I’ve seen can be broken by either party at any time as long as proper notice is given in writing to the other party. Some will have a few other stipulations involved with the breaking of the lease, but most I’ve seen are pretty similar.

I may actually call OOIDA tomorrow and ask the legal department there about the language we are at odds about. I could be wrong here, but I’m pretty sure I’m not. I have enough background in contract law to usually come to the correct interpretation of what I have read. Either way, right or wrong, I’d like to know for curiosity’s sake which it is. While I love being right, I hate being wrong even more so now I really need to know.

[solo379]

Originally Posted by Musicman

so now I really need to know.

OK! Let us know what did you find out, and i sure will do the same.