Lease-on Agreement

Lawyer

 

You can find some generic ones by Google. I would look at them, then talk to a lawyer. Its a legal binding document. Don't wanna screw this up.

 

I agree with the lawyer thing and one who has experience with trucking

Doing things on the cheap now will most certainly cost you way more later when there’s a wreck or what someone feels is an unfair letting go

Everyone and I mean EVERYONE is sue happy. Even your friends and family

If it has happened yet then there just hasn’t been the opportunity. Yet!

 

Purchase a professionally written lease agreement. This is a fairly complex issue that needs to comply with Part 376 for FMCSA compliance as well as contract law from whatever state your business is based out of and will be the governing document for when it all goes wrong. Trust me, no matter how well you know someone or how good of intentions everyone has a business deal is only as good as the paper it is written on if not done properly. Don't settle for the fill in the blank forms available for $29.95 online, they are just about worthless and don't try to plagiarize someone else's agreement, especially without fully understanding it. Change one word and you could change the whole meaning of a clause.

This agreement needs to protect both your business and the owner operator, clearly spell out rules for each possible scenario you could find yourself in and detail what can be charged back, if they can use outside brokers and if so under what conditions, etc. Our lease agreement was 12 pages, not including rate structure, chargebacks and other company policies the had to agree to abide by to lease onto my company.

Now, to answer your question about using an outside dispatcher, that is purely up to you. I would not allow outside freight if it were me. When I had my car haulers we had a few leased operators, including my own brother, and we always controlled 100% of the freight. I only leased on trucks to cover my customers not just to make a few points on someone else's freight. It simply isn't worth the risk to take on a leased operator just to have them haul freight that isn't from my direct customers.

Keep in mind if you do allow the owner operator to source their own freight it will be as if you found it yourself making your company fully liable for collecting the invoice, any damages or loss and making sure it gets hauled. A service failure will look bad on you, not the owner operator, so be cautious about what and where you agree to allow an owner operator to commit your company and it's assets (his truck included) to haul. Also, you will be legally bound to pay the owner operator within 15 days even if you do not get paid from the freight he sourced so make sure you are aware of the risk associated with that.

 

49 CFR is Title 49 Code of Federal Regulations, which is the section of regulations that are commonly referred to as the Federal Motor Carrier Safety Regulations. Parts 40 and 382 are the drug and alcohol regulations, nothing DMV or IRP would be interested in. Parts 390-399 are the general rules for all motor carriers, including leased operators.

Specifically the DMV/IRP Board will be looking for reference to 49 CFR Part 376 which is the leasing regulations.

Electronic Code of Federal Regulations (eCFR)

No offense intended, I mean this as sincere advice, but honestly if you don't even know what the regulations are how can you expect to create a compliant, safe and equitable lease arrangement with an owner operator? You really need to get professional guidance outside of this forum from a competent transportation lawyer before you create an unenforceable agreement, or worse yet one that puts your company and personal assets at risk.

Remember, when you lease on a truck and driver you become fully liable for them as if they were your employee and you owned the truck. These agreements are not something to be entered into lightly or uninformed. If you insist on doing this yourself then I strongly recommend you purchase a copy of the book Rules of the Road, A Practical Guide to Legal Issues in Truck Transportation by Hank Seaton, Esq.

The Law Office of Seaton & Husk, LP

Hank is a transportation lawyer with decades of experience going all the way back to the ICC days and his guide will explain in detail why contracts are important, the basic content they must have and why a lawyer or other competent council is highly advised. I use his guide book daily, and for the moderators -no I do not have a working relationship with Hank nor do I receive any consideration for promoting his book, just giving good advice to help a member here.

Best wishes for success.

 

I used to run under my own authority until a few years ago when I switched from car hauling to flatbed
I am now leased on to a company and although we can find our own loads it is they, the company I am leased on to that will verify the broker credit and it is they who decide whether or not they’ll book the load for me for the reasons you posted
Liability. Payment. Reputation and so on

 

Just don’t be too quick to jump in to this

It’s easier to jump in than out of a bad situation
Many see $$ signs and how to make more and forget about everything else then lose everything in the end
Slow and steady with a ton of research

And you will never have full knowledge, that’s why you need other key people like lawyer etc