During class, I receive and review hundreds of broker/motor carrier contracts from my students. It is quite apparent to me that most people brokering loads or receiving them don’t understand the purpose of a contract. Allow me to illustrate a few contract basics:

First, a broker may not declare an interest in a cargo. Brokering is not a mode of transportation as defined by the Federal Motor Carrier Safety Administration’s regulations and enabling legislation. This makes the broker a travel agent of freight — exempt from safety issues and insurance liability. (Some insurance companies are successfully selling contingent cargo insurance for those brokers who create all kinds of “interest” in a cargo.)

Note that brokering can occur between two motor carriers, but the contract should read “motor carrier to motor carrier.” Most of these brokered loads are offered by large motor carriers to other motor carriers. This brokering creates equal liability both for public liability and cargo through subrogation. One motor carrier does not become “not liable” in doing so; both parties are equally liable, as a lessor and leasee would be.

The purpose of our Freight Training  curriculum is to make learning easier. The program content is an accumulation of 40 years of brokering and trucking experience in the field, and in the classroom. Changes in the transportation brokering industry have been confusing and numerous. The latest law change is commonly referred to as MAP-21, which essentially eliminates the brokering conduct referred to as “Truck Brokering” (one authorized carrier hiring another authorized carrier). The only brokering now permitted by Law is “Licensed Property Brokering”, as defined, as of this writing, as 49 CFR 371.2. This brokering definition is what our curriculum all about.