Georgia’s Direct
Action Statute

Jeff Shiver and Alan Hamilton
Shiver Hamilton
Atlanta, GA


Though it has been around for decades, many lawyers are unfamiliar with Georgia’s Direct Action Statute. Georgia’s Direct Action Statute (“DAS”) allows plaintiffs to name the insurance company as a party defendant in the case and have the insurance company listed on all pleadings including the verdict form and judgment. The DAS “establishes an independent cause of action against the carrier’s insurer on behalf of a member of the public injured by the carrier’s negligence.” Glenn McClendon Trucking Co. v. Williams, 183 Ga. App. 508–509 (1987).

The DAS is found in two separate places in the Georgia code.  O.C.G.A. § 40-1-112(c) and O.C.G.A. § 40-2-140(d)(4) both empower plaintiffs to “join in the same action the motor carrier and the insurance carrier,” but involve different provisions.  Because it is important to determine the applicability of the particular statutory provisions to a particular defendant, these two statutes will be examined separately.
O.C.G.A. § 40-2-140 – Georgia Unified Carrier Registration System

In 2008, the federal government enacted the Unified Carrier Registration Agreement (“UCRA”) and each state had the option to opt into the Agreement. In 2009, Georgia enacted O.C.G.A. § 40-2-140, which allowed Georgia to opt into the UCRA. O.C.G.A. § 40-2-140 provides:
(c) Every foreign or domestic motor carrier, leasing company leasing to a motor carrier, broker, or freight forwarder that engages in interstate commerce in this state shall register with the commissioner or a base state and pay all fees as required by the federal Unified Carrier Registration Act of 2005.

(d)       (1) Any intrastate motor carrier, leasing company leasing to a motor carrier, broker, or freight forwarder that engages in intrastate commerce and operates a motor vehicle on or over any public highway of this state shall register with the commissioner and pay a fee determined by the commissioner.

(4) Any person having a cause of action, whether arising in tort or contract, under this Code section may join in the same cause of action the motor carrier and its insurance carrier.

O.C.G.A. § 40-2-140 (emphasis added).

Under § 40-2-1(4), a “[f]or-hire intrastate motor carrier means an entity engaged in the transportation of goods … for compensation wholly within the boundaries of the state.”  O.C.G.A. § 40-2-1(5) defines an “[i]ntrastate motor carrier” as “any self-propelled or towed motor vehicle operated by an entity that is used on a highway in intrastate commerce to transport passengers or property and has a gross vehicle weight rating, gross combination weight rating, gross vehicle weight, or gross combination weight of 4,536 kg (10,001 lbs.) or more, whichever is greater.”  Finally, O.C.G.A. § 40-2-1(6) defines a “[m]otor carrier” as “[a]ny entity defined by the commissioner or commissioner of public safety who operates or controls commercial motor vehicles as defined in 49 C.F.R. Section 390.5 or this chapter whether operated in interstate or intrastate commerce, or both.” O.C.G.A. § 40-2-1(6)(B).  The DAS under § 40-2-140 applies to both interstate and intrastate commerce.  See Bramlett v. Bajric, No. 1:12-CV-2148-TWT, 2012 WL 4951213, at *2 (N.D. Ga. Oct. 17, 2012).
Pursuant to 49 C.F.R. § 390.5, a commercial motor vehicle is defined as “any self-propelled or towed motor vehicle used on a highway … to transport passengers or property when the vehicle—(1) Has a gross vehicle weight rating or gross combination weight rating, or gross vehicle weight or gross combination weight, of 4,536 kg (10,001 pounds) or more, whichever is greater.” 49 C.F.R. § 390.5.  A “motor carrier” under 49 C.F.R. § 390.5 is defined as
a for-hire motor carrier or a private motor carrier. The term includes a motor carrier’s agents, officers and representatives as well as employees responsible for hiring, supervising, training, assigning, or dispatching of drivers and employees concerned with the installation, inspection, and maintenance of motor vehicle equipment and/or accessories. For purposes of subchapter B, this definition includes the terms employer, and exempt motor carrier.
49 C.F.R. § 390.5. A “[f]or-hire motor carrier means a person engaged in the transportation of goods or passengers for compensation.” 49 C.F.R. § 390.5 (emphasis added). Additionally, a “[p]rivate motor carrier means a person who provides transportation of property or passengers, by commercial motor vehicle, and is not a for-hire motor carrier.” 49 C.F.R. § 390.5 (emphasus added).
In Bramlett v. Bajric, the Northern District of Georgia weighed in on the public policy of O.C.G.A. § 40-2-140. The court stated,
[T]he broad language within section [40-2-140(c)(2)] strongly supports the conclusion that the [direct action statute] is intended to ensure that motorists injured in Georgia can sue a motor carrier and its insurer without regard to the carrier’s scope of business. This conclusion is supported by the statement that the motor carrier’s insurance policy shall provide for the protection of passengers in passenger vehicles and the protection of the public against the negligence of such motor carrier, and its servants or agents, when it is determined to be proximate cause of any injury.

Bramlett, 2012 WL 4951213 at *3 (internal quotation marks omitted).

O.C.G.A. § 40-1-112  – Georgia Motor Carrier Act (2012)

In 2012, the Georgia General Assembly enacted the Georgia Motor Carrier Act of 2012 (“GMCA”). The GMCA provided a second DAS codified under O.C.G.A. § 40-1-112, which applies to motor carriers operating pursuant to a permit issued by the Georgia Department of Public Safety. Specifically, O.C.G.A. § 40-1-112 states:
(a) No motor carrier of household goods or property or passengers shall be issued a motor carrier certificate unless there is filed with the department a certificate of insurance for such applicant or holder on forms prescribed by the commissioner evidencing a policy of indemnity insurance by an insurance company licensed to do business in this state, which policy must provide for the protection, in case of passenger vehicles, of passengers and the public against injury proximately caused by the negligence of such motor carrier, its servants, or its agents; and, in the case of vehicles transporting household goods, to secure the owner or person entitled to recover against loss or damage to such household goods for which the motor common carrier may be legally liable. The department shall determine and fix the amounts of such indemnity insurance and shall prescribe the provisions and limitations thereof. The insurer shall file such certificate. The failure to file any form required by the department shall not diminish the rights of any person to pursue an action directly against a motor carrier’s insurer.

(b) The department shall have power to permit self-insurance, in lieu of a policy of indemnity insurance, whenever in its opinion the financial ability of the motor carrier so warrants.

(c) It shall be permissible under this part for any person having a cause of action arising under this part to join in the same action the motor carrier and the insurance carrier, whether arising in tort or contract.

O.C.G.A. § 40-1-112 (emphasis added).
Under Georgia law, “[a] motor carrier, which may be classified either as a ‘common’ or ‘contract’ carrier, is one which ‘owns, controls, operates, or manages any motor propelled vehicle used in the business of transporting for hire of persons or property on the public highways of Georgia.”  Sapp v. Canal Ins. Co., 288 Ga. 681, 682 (2011); see also O.C.G.A. § 40-1-100(12). “Transporting ‘for hire’ is defined as ‘an activity wherein for payment or other compensation a motor vehicle and driver are furnished to a person by another person.’” Sapp, 288 Ga. at 682.
Certain exemptions exist under § 40-1-100(12) that will protect an insurer from a direct action. Specifically, § 40-1-100(12)(B) provides that certain carriers are included within the statutory scope of “motor carrier for hire.” The exemptions include vehicles engaged solely in transporting school children to and from school, taxicabs operating within municipalities, limousines, hotel passenger vehicles, motor vehicles operated not for profit to transport elderly or disabled passengers, vehicles owned and operated by the federal government, and ambulances. O.C.G.A. § 40-1-100(12).  The former DAS included an exemption regarding agricultural products. However, the updated code does not include such an exemption.

A recent trend by defense lawyers is to ask the trial court to exclude reference to the direct action defendant insurer in exchange for a stipulation that the insurer be subject to judgment.  This strategy, while creative, has been rejected.  “[E]vidence of insurance is proper ‘where the insurer is a party to the proceeding.’”  Jiles v. Smith, 118 Ga. App. 569, 569 (1968).  The goal of this argument is to disarm the DAS on the basis that an insurance company being included as a named party is so inherently prejudicial that the Court should impose limitations on the DAS not imposed by the legislature.   The legislature had every opportunity to create a mechanism where the direct action carrier was subject to judgment without revealing its presence as a party to the jury.  No such provision is found in the DAS.

The purpose of the DAS is to protect the motoring public.  Sapp, 288 Ga. at 682 (citing DeHart v. Liberty Mut. Ins. Co., 270 Ga. 381, 385 (1998)).  The legislature decided the importance of protecting motorists is more important than any potential prejudice resulting from having an insurance company as a party defendant.   In so doing, it creates and eliminates certain rights.  See Morgan Driveway, Inc. v. Canal Ins. Co., 266 Ga. App. 765, 769 (2004).  In finding that the DAS creates substantive rights in favor of plaintiffs and against insurers, the Court of Appeals identified multiple rights created or eliminated by The DAS.  See id.  The DAS creates the right of a plaintiff to join in a lawsuit against the tortfeasor the company that insured the motor carrier.  Id.  It eliminates “the insurer’s right to avoid having its insured characterized as a motor contract or common carrier, to avoid being named directly in a lawsuit, and consequently the prejudicial impact on jury deliberations of the existence of insurance coverage.”  Id.

It is the role of the legislature and not of courts to articulate the parameters of and limitations on the DAS.  See Lockhart v. Southern General Ins. Co., 231 Ga. App. 311, 313 (1998).  Accordingly, courts should not, and currently have not accepted the invitation to alter the statutory DAS by excluding the identity of the insurance company at trial.

Insurance companies also sometimes argue that their presence in the litigation should not be disclosed to the jury where they provided only a “fronting policy” to the insured motor carrier.  A “fronting policy” is “a form of self-insurance in which the deductible is identical to the limits of liability, and the insurance company acts only as surety that the holder of the fronting policy will be able to pay any judgment covered by the policy.”  Dorsey v. Fed. Ins. Co., 154 Ohio App. 3d 568, 574, 798 N.E.2d 47, 51 (2003).  Essentially, the insurer argues, an insured with a “fronting policy” is self-insured, and therefore naming the insurance company in the litigation is unduly prejudicial where they did not actually provide a policy of insurance.  However, this argument is another attempt to end-run the express wording of the DAS and controlling precedent.  A motor carrier with a “fronting policy” is not in fact self-insured, since a “fronting policy” is a policy of insurance pursuant to the DAS.  O.C.G.A. § 40-1-112 provides the option for self-insurance in lieu of an insurance policy, but a “fronting policy” does not constitute self-insurance under Georgia law.  No exception for such a policy exists in the statute or in Georgia case law.  Thus, “[u]nder the guise of construing a statute, [courts] are not at liberty to rewrite it.”  White Cloud Charter, Inc. v. DeKalb Cnty. Bd. of Tax Assessors, 238 Ga. App. 805, 806 (1999).

Choosing a Venue
When a plaintiff is injured by a motor carrier, the plaintiff may sue the driver alone, or the motor carrier alone, or she may sue them jointly.  Seawheels v. Bankers & Shippers Ins. Co. of N.Y., 175 Ga. App. 528, 532 (1985).   Likewise, the plaintiff can sue “the insurance carrier alone or, as authorized by the act, she [may join] the motor carrier and the insurance carrier in the same action, irrespectively of whether it sounded in tort or in contract.” Id.  But because a motor carrier and its insurer are not considered joint tortfeasors, proper venue as to one defendant is not necessarily proper venue as to the other.  Jackson v. Sluder, 256 Ga. App. 812, 814 (2002).  Therefore, where a particular venue is proper as to the motor carrier and driver, but not as to the insurer, a plaintiff’s attorney must decide whether to attempt to gain the insurer’s consent to be sued in the same venue as the other defendants, or to sue the insurance company separately.
In Bartja v. National Union Fire Insurance Co. of Pittsburgh, Pennsylvania, 218 Ga. App. 815, 815 (1995), an injured motorist filed suit against the tractor-trailer truck driver, the motor carrier and the insurance carrier under the DAS. Prior to final judgment, the plaintiff voluntarily dismissed without prejudice the driver and motor carrier, leaving only the insurer as a defendant. Id. The plaintiff then re-filed his negligence claims against the motor carrier. Id. at n.1.
As a preliminary matter, we note that a contract action against an insurer of a motor carrier on the policy itself is cognizable as an independent suit without joinder of the motor carrier. . . . Thus, where an actionable injury exists at the time suit is filed, the injured party need not pursue a suit against the motor carrier in order to sue the insurer, even though “under the Motor Carrier Act, OCGA § 46-7-1 et seq., the insurance carrier is not, in reality, a separateparty for purposes of liability, but, rather, is equivalent to a provider of a substitute surety bond, creating automatic liability in favor of a third party who may have a claim for damages for the negligence of the motor common carrier. . . . Accordingly, the resolution of the venue issue as to [the motor carrier] does not affect the viability of this action.

Id. (emphasis added) (internal citations omitted) (internal quotation marks omitted).  Thus, where an insurance company objects to venue that is proper as to its insured, plaintiff’s counsel may voluntarily dismiss the insurance company and file suit in the insurance company’s desired venue while keeping the claims against the motor carrier and driver in the original venue. See id.  As a practical matter, however, since the insurance company will still have to provide a defense to the other parties in the original venue, it may find that it is more inconvenient to defend two separate lawsuits than it would be to remain in the original venue.

In conclusion, the DAS is an important provision allowing an injured Plaintiff to include the insurer on the judgment.  Whether the defendant be a bus, limousine or traditional tractor trailer, a plaintiff’s lawyer should presume the DAS applies and proceed accordingly from the beginning of a case.

[1] The Direct Action Statute is broad and cases interpreting its various provisions numerous.  This article intends to broad-brush the Direct Action Statute generally.  For case specific questions, please email Jeff Shiver at
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