TRENTON, N.J. (Legal Newsline) – The New Jersey Supreme Court recently upheld judgments in a class action lawsuit that accused a company of violating lease agreements with truckers by failing to reimburse their diesel fuel taxes.
In its April 25 per curiam opinion, the high court upheld a Superior Court Appellate Division ruling in the case against Proud 2 Haul Inc., which resulted in judgments of $382,753 and $4.48 million against the company.
The plaintiffs are a class of truck owner-operators who contracted with P2H to deliver sealed containers from the Port of New Jersey to customers in the northeastern United States, court filings said.
A synopsis of the suit states: "P2H supplied plaintiffs with credit cards that plaintiffs used to purchase diesel fuel for their trucks and gasoline for their personal vehicles. The Nov. 19, 2010, lease agreements between plaintiffs and P2H provided that P2H would reimburse plaintiffs for the taxes included in the price of diesel fuel they purchased for their trucks. In June 2012, P2H entered into an agreement with Trucking Support Services, doing business as Contracts Resource Solutions (CRS), under which CRS leased the trucks from the owner-operators.
"CRS in turn assigned the services and equipment it leased from the owner-operators to P2H. Plaintiffs’ complaint alleged in pertinent part that defendants violated the Truth In Leasing regulations by virtue of their arrangement with CRS, violated New Jersey’s Wage Payment Law, and engaged in acts of conversion and fraud."
The trial court awarded plaintiffs $382,753 on their claim that defendants violated the lease
agreements by failing to reimburse plaintiffs’ diesel fuel taxes. The trial court also awarded plaintiffs $4.48 million on their claim that P2H violated Truth In Leasing regulations by failing to have written lease agreements with plaintiffs.
P2H challenged the second amount, arguing that CRS, not the truck drivers, was the “owner” of the equipment because CRS had the exclusive right to use of the equipment.
An appeals court rejected that argument, finding that CRS was not the “owner” of the trucks under the
Truth In Leasing regulations because it did not have the right to exclusive use of the trucks.
The appeals court found that the agreements were devoid of any language that made CRS’s relationship to plaintiffs exclusive because they did not prohibit plaintiffs from entering into contractual agreements with other motor carriers and, in fact, allowed for direct arrangements to be made between plaintiffs and P2H.