Hollywood Trucking, Inc. v. Watters

Ill.App. 5 Dist.,2008.

Appellate Court of Illinois,Fifth District.

HOLLYWOOD TRUCKING, INC., Plaintiff-Appellant,

v.

Roger WATTERS, M.D., Primary Care Group, and James Atkinson, Defendants-Appellees.

No. 5-06-0231.

Sept. 18, 2008.

Justice DONOVAN delivered the opinion of the court:

The plaintiff, Hollywood Trucking, Inc. (Hollywood), filed a three-count complaint in the circuit court of Saline County, against the defendants, Roger Watters, M.D., Primary Care Group (Primary Care), and James Atkinson. In the complaint, Hollywood alleged that Dr. Watters negligently certified Atkinson’s physical fitness to operate a commercial motor vehicle under regulations established by the United States Department of Transportation (DOT) (count I); that Dr. Watters fraudulently certified that Atkinson was physically fit to operate a commercial motor vehicle under DOT regulations (count II); that James Atkinson fraudulently misrepresented his medical history in that he failed to disclose prior back surgeries during the DOT certification examination (count III); and that if it had been aware of Atkinson’s back condition, it would not have hired Atkinson and it would not have become liable to provide benefits to him under the Illinois Workers’ Compensation Act (820 ILCS 305/1 et seq. (West 2002)).

All the defendants filed motions to dismiss the counts against them pursuant to section 2-619 of the Illinois Code of Civil Procedure (Code) (735 ILCS 5/2-619 (West 2004)). After considering the parties’ arguments, the circuit court dismissed with prejudice count I and count III but let count II stand. The court expressly found that there was no just reason to delay the enforcement or appeal of its rulings. Hollywood filed this appeal pursuant to Illinois Supreme Court Rule 304(a) (210Ill.2dR. 304(a)).

Hollywood is an interstate motor carrier located in Eldorado, Illinois. Its operations are regulated by the DOT. The DOT imposes a number of rules on interstate motor carriers and the persons who drive commercial motor vehicles for those carriers. See 49 C.F.R. §§ 391.1, 391.11(a) (2005). Each motor carrier is required to investigate and make inquiries with respect to the backgrounds and qualifications of the driver it employs. 49 C.F.R. § 391.23 et seq. (2005). Each driver is required to periodically submit to road tests (49 C.F.R. § 391.31 (2005)) and physical examinations (49 C.F.R. § 391.41 (2005)) in order to establish the driver’s competence to operate and control a commercial motor vehicle. A driver is also required to present a copy of a medical examiner’s certificate stating that the driver is physically qualified to operate and control a commercial motor vehicle safely. 49 C.F.R. §§ 391.41(a), 391.45 (2005).Section 391.41(b) of Title 49 of the Code of Federal Regulations (49 C.F.R. § 391.41(b) (2005)) identifies the physical and medical conditions to be evaluated during the examination. The standardized medical evaluation form includes a section noting the driver’s health history and a section detailing the physical examination. Section 391.43 identifies the qualifications of the medical examiners and provides the examiners with instructions for performing the examination and recording the results. 49 C.F.R. § 391.43 (2005).

“The medical examiner must be aware of the rigorous physical, mental, and emotional demands placed on the driver of a commercial motor vehicle. In the interest of public safety, the medical examiner is required to certify that the driver does not have any physical, mental, or organic condition that might affect the driver’s ability to operate a commercial motor vehicle safely.”(Emphasis added.) 49 C.F.R. § 391.43(f) (2005).

Section 391.47 provides a process for a resolution in the event of a disagreement between the physician for the driver and the physician for the motor carrier regarding the driver’s physical fitness to operate a commercial vehicle. 49 C.F.R. § 391.47 (2005).

On January 9, 2004, Atkinson presented to Primary Care to undergo a medical examination for purposes of determining his fitness to drive a commercial motor vehicle under 49 C.F.R. § 391.41 (2005). According to the “Medical Examination Report for Commercial Driver Fitness Determination” (DOT medical report), Atkinson was seeking a new certification of his physical qualifications to operate a commercial motor vehicle. Dr. Watters, an employee of Primary Care, conducted the physical examination and completed the DOT medical report. Dr. Watters found that Atkinson had no abnormalities or conditions in the body systems listed in the DOT’s standardized form. Dr. Watters determined that Atkinson met the physical qualifications to operate a commercial vehicle according to 49 C.F.R. § 391.41(b) (2005) and that Atkinson qualified for a two-year certificate.

Sometime after Atkinson was medically certified to operate a commercial motor vehicle, he was hired by Hollywood. On June 22, 2004, Atkinson was securing a tarp over a load of lumber when he fell approximately 10 to 12 feet, from the top of a tractor-trailer to the ground, and injured his back.

On July 26, 2004, Atkinson filed a workers’ compensation claim. After the claim was filed, Hollywood disclosed that it had not obtained workers’ compensation insurance and that it would be personally liable for any award of medical expenses, temporary total disability benefits, and permanent disability benefits that were found to be attributable to the incident on June 22, 2004. Hollywood paid a portion of Atkinson’s medical bills and temporary total disability benefits but then denied liability and ceased further payments. In defending its decision to stop paying benefits, Hollywood initially claimed that Atkinson had sustained his injuries at home and that his injuries did not arise out of and in the course of his employment. Several months later, Hollywood asserted that Atkinson was not eligible for benefits because he had made false representations regarding his medical history in the DOT fitness report.

On January 9, 2006, Hollywood filed a three-count complaint against Dr. Watters, Primary Care, and Atkinson in the circuit court of Saline County. Hollywood brought count I against Dr. Watters and Primary Care. Hollywood alleged that Dr. Watters performed a DOT examination on Atkinson on January 9, 2004; that Dr. Watters and Primary Care owed “Hollywood Trucking, Inc. [,] and other employers who might hire Atkinson as a truck driver and the general motoring public a duty to examine Atkinson and to report his physical condition using that degree of skill and care normally employed by those with like training, education[,] and experience”; and that Dr. Watters violated his duty of care and was negligent in that (a) he failed to recognize and report that Atkinson had obvious surgical scars on his back, (b) he failed to recognize and report that Atkinson had lied when he reported that he never had a spinal injury, spinal disease, or chronic lower back pain, (c) he reported that Atkinson had no previous surgery to his back or spine, no deformities to his back or spine, no limitation of motion to his back or spine, and no tenderness to his back or spine, when, had he examined Atkinson’s back, he could have seen the surgical scars, and (d) he reported that Atkinson met the standards of 49 C.F.R. § 391.41 (2005), when he did not meet those standards. Hollywood further alleged that as a proximate cause of one or more of the negligent omissions, it hired Atkinson and thereafter became liable to defend against Atkinson’s workers’ compensation claim and to pay benefits for injuries and disabilities that are causally connected to the June 22, 2004, incident.

Atkinson’s workers’ compensation claim was pending when Hollywood filed its complaint. Atkinson’s claim was unresolved as of the date of oral arguments on appeal.

Hollywood brought count II against Dr. Watters and alleged fraudulent misrepresentation in regard to the performance of the DOT medical examination and the certification of the driver. Count II is not at issue in this appeal.

The circuit court denied Dr. Watters’ motion to dismiss count II, but it stayed the action pending the disposition of this appeal.

Hollywood brought count III against its employee. Hollywood alleged that Atkinson fraudulently misrepresented his medical condition in that he indicated that he had no prior history of spinal injury, disease, or lower back pain in the patient history section of the DOT medical report when he knew that he had undergone back surgery and had experienced a prior limitation of motion, chronic low back pain, and tenderness in his spine. Hollywood reasserted the elements of damages set forth in count I, and it made a claim for punitive damages.

The defendants moved to dismiss the counts filed against them pursuant to section 2-619 of the Code. The circuit court determined that under the circumstances alleged in count I, a physician owes no duty to a prospective employer, such as Hollywood, to exercise ordinary care in physically examining an individual to determine whether he or she is physically qualified to drive a commercial motor vehicle pursuant to DOT regulations set forth in 49 C.F.R. § 391.41 et seq. (2005). The court dismissed count I with prejudice. The court also determined that the Illinois Workers’ Compensation Commission had exclusive jurisdiction over the matters described in count III, and it dismissed count III with prejudice. This appeal followed.

A motion for an involuntary dismissal filed pursuant to section 2-619 raises certain defects or defenses to the action. 735 ILCS 5/2-619 (West 2004). In considering a trial court’s decision to grant a motion for an involuntary dismissal, a reviewing court must accept all well-pleaded facts as true and view them in a light most favorable to the plaintiff. Bartow v. Ford Motor Co., 342 Ill.App.3d 480, 483, 794 N.E.2d 1027, 1029 (2003). The standard of review is de novo. Bartow, 342 Ill.App.3d at 483, 794 N.E.2d at 1030.

The first issue is whether the circuit court erred in dismissing count I on the ground that Dr. Watters and Primary Care had no duty to prospective employers, such as Hollywood, to exercise ordinary care in performing a DOT medical examination pursuant to 49 C.F.R § 391.41 (2005). In order to state a legally sufficient cause of action for negligence, the complaint must set out facts that establish the existence of a duty owed by the defendant to the plaintiff, a breach of the duty, and an injury proximately caused by the breach. Kirk v. Michael Reese Hospital & Medical Center, 117 Ill.2d 507, 525, 513 N.E.2d 387, 395-96 (1987). The existence of a duty is a question of law to be determined by the court. Kirk, 117 Ill.2d at 525, 513 N.E.2d at 396. The court must determine whether the defendant and the plaintiff stood in such a relationship to each other that the law imposed upon the defendant an obligation of reasonable conduct for the benefit of a plaintiff. Kirk, 117 Ill.2d at 525, 513 N.E.2d at 396. The Illinois Supreme Court has instructed that the existence and the scope of a legal duty should not rest only on the foreseeability of the occurrence. Cunis v. Brennan, 56 Ill.2d 372, 375, 308 N.E.2d 617, 618-19 (1974). A court should consider the reasonable foreseeability of the injury, the likelihood of injury, the burden of guarding against the injury, and the consequences of placing that burden upon the defendant. Kirk, 117 Ill.2d at 526, 513 N.E.2d at 396.

The nature of the relationship between the parties is a threshold question in the duty analysis. In this case, Hollywood has neither alleged nor argued that there is a direct relationship between itself and Dr. Watters and Primary Care. Hollywood has not asserted that Dr. Watters and Primary Care performed Atkinson’s DOT fitness examination at its request. Hollywood has not asserted that it directs its drivers and prospective hires to obtain their DOT fitness examinations at Primary Care or that it pays for examinations performed at Primary Care. Hollywood acknowledges that Atkinson was not one of its employees at the time he presented to Primary Care for his DOT fitness examination. The absence of a special, intimate relationship between Atkinson and Hollywood eliminates from consideration a duty owed by Dr. Watters and Primary Care to Hollywood under the transferred-negligence theory discussed in Renslow v. Mennonite Hospital, 67 Ill.2d 348, 367 N.E.2d 1250 (1977), and Tedrick v. Community Resource Center, Inc., 373 Ill.App.3d 761, 869 N.E.2d 421 (2007), appeal allowed,225 Ill.2d 677, 875 N.E.2d 1125 (2007). Likewise, the absence of a special relationship between Atkinson and Dr. Watters eliminates from consideration any of the recognized exceptions to the general rule that a person has no duty to control the conduct of a third party to prevent him from causing harm to another. See Restatement (Second) of Torts §§ 315 through 319 (1965); Estate of Johnson v. Condell Memorial Hospital, 119 Ill.2d 496, 509-10, 520 N.E.2d 37, 42-43 (1988).

Hollywood’s difficulties in defining the duties of Dr. Watters and Primary Care are revealed in its pleadings in the circuit court and its written and oral arguments before this court. Within the period between the filing of the complaint in the circuit court and the filing of the briefs in this court, the theory alleged in count I was gradually transformed from a general negligence theory to a more specific theory of negligent misrepresentation. Nevertheless, the nature and scope of Dr. Watters’ duty remains unclear.

Hollywood suggests that Dr. Watters should be held liable for negligently misrepresenting the results of the DOT fitness examination because he is an approved evaluator who undertook to examine Atkinson and record the results of the examination for the specific purpose of directly benefiting prospective employers. Hollywood contends that it was an intended beneficiary of the relationship between Dr. Watters and Atkinson. We disagree. The circumstances of this case do not fit within the parameters of cases where a professional has been hired by a client to render services for the specific purpose of conferring a benefit on a third party. See, e.g., Pelham v. Griesheimer, 92 Ill.2d 13, 20-21, 440 N.E .2d 96, 99-100 (1982); Stinson v. Physicians Immediate Care, Ltd., 269 Ill.App.3d 659, 646 N.E.2d 930 (1995).

In this case, Atkinson went to Dr. Watters for the primary purpose of obtaining a DOT medical certificate so that he could drive commercial motor vehicles. Atkinson was a direct beneficiary of the examination. The DOT regulations governing the medical examination of drivers specifically provide that the examiner’s duty is to evaluate the driver’s present physical condition for purposes of determining whether he has any infirmity that is likely to interfere with his ability to operate and control a commercial vehicle safely, and they also provide that the examination and certification of physical fitness are required in the interest of public safety. 49 C.F.R. §§ 391.41, 391.43(f) (2005). It is clear that the DOT medical examination was implemented for the safety of the traveling public, and not for purposes of insulating an employer from every claim of injury an employee sustains in the course of his employment. Count I fails to allege factual allegations to establish that Hollywood was an intended beneficiary of the professional services that Dr. Watters provided to Atkinson.

Perhaps under other circumstances, one could make a compelling argument that those traveling on public highways are direct and intended beneficiaries of the DOT medical examination, but that issue is not before us.

Hollywood also suggests that in conducting the DOT medical examination, Dr. Watters assumed a duty to provide information to employers of physically unsafe drivers “whose hiring may cause financial loss to the employer and physical injury and damage to drivers and others” on the highway. It contends that Dr. Watters should be held liable for negligently misrepresenting the results of the DOT medical examination because he knew that prospective employers would be guided by the results in making hiring decisions.

Negligent misrepresentation involves the breach of a duty to use reasonable care in obtaining and communicating information upon which others may reasonably be expected to rely in the conduct of their business transactions.Restatement (Second) of Torts § 552 (1977); Cahill v. Eastern Benefit Systems, Inc., 236 Ill.App.3d 517, 603 N.E.2d 788 (1992). Section 552(3) of the Restatement (Second) of Torts states that the liability of one who is under a public duty to give information extends to the loss suffered by a person or a limited group of persons for whose benefit and guidance the information is intended, in any of the transactions in which it is intended to protect them.Restatement (Second) of Torts § 552(3) (1977); Cahill, 236 Ill.App.3d 517, 603 N.E.2d 788.

In this case, Dr. Watters conducted a DOT medical examination on Atkinson for the purpose of determining whether he had any condition or infirmity that would likely interfere with his ability to operate and control a commercial motor vehicle on the public highways. The DOT medical examination was not performed for the purpose of certifying that he would not reinjure or aggravate his back while performing his work-related duties, and the result of the examination was not expected or intended to be used to assess the likelihood that Atkinson would suffer an on-the-job injury and to calculate the potential exposure to a prospective employer under the Workers’ Compensation Act if it hired Atkinson. Additionally, we note that the complaint does not allege that Hollywood actually relied upon the results of Dr. Watters’ examination or that it would be required to accept the opinion of a prospective employee’s physician under the federal regulations (49 C.F.R. § 391.47 (2005)).

Having liberally construed the factual allegations in count I and the theories of liability and duty developed in the appellate arguments, we conclude that Hollywood has not alleged facts to establish that Dr. Watters and Primary Care owed it a duty of care under the circumstances of this case. The circuit court did not err in dismissing count I with prejudice.

We next consider whether the circuit court erred in dismissing count III on the basis of a lack of jurisdiction. The court found the Illinois Workers’ Compensation Commission (Commission) has exclusive jurisdiction over the matters described in count III, and therefore, it dismissed with prejudice Hollywood’s fraud count against Atkinson. Hollywood contends that the court’s ruling ignores the fact that the fraud allegations in count III are based upon events which predate Atkinson’s employment with Hollywood and his alleged on-the-job injury. Hollywood insists the pending action was filed for the purpose of obtaining a remedy for the harm that resulted from Atkinson’s fraudulent misrepresentations prior to his employment and not for purposes of litigating the merits of Atkinson’s workers’ compensation case. Hollywood contends that there are no provisions within the Workers’ Compensation Act which indicate that the Commission is expected to authorize or to adjudicate matters concerning restitution or the repayment of workers’ compensation benefits and that the action can only be brought in the circuit court as a common law action for fraud. We disagree.

Section 18 of the Illinois Workers’ Compensation Act (Act) (820 ILCS 305/18 (West 2002)) specifically states, “All questions arising under this Act, if not settled by agreement of the parties interested therein, shall, except as otherwise provided, be determined by the Commission.”The Illinois Supreme Court has determined that the circuit courts have no original jurisdiction in cases involving a determination of workers’ compensation benefits. Hartlein v. Illinois Power Co., 151 Ill.2d 142, 158, 601 N.E.2d 720, 727 (1992). However, the Illinois Supreme Court has held that there are certain instances in which the Commission and the circuit court have concurrent jurisdiction to decide a question raised in a workers’ compensation case. For example, in Employers Mutual Cos. v. Skilling, 163 Ill.2d 284, 644 N.E.2d 1163 (1994), the Illinois Supreme Court determined that the Commission and the circuit court had concurrent jurisdiction to consider an insurance issue regarding the scope of coverage afforded under a workers’ compensation policy. Skilling, 163 Ill.2d at 286-87, 644 N.E.2d at 1165.

According to the factual allegations set forth in count III of the complaint, Hollywood is seeking to recoup the benefits it has paid to Atkinson under the Act, on the theory that Atkinson fraudulently misrepresented his physical condition at the time of his hiring. The allegations in count III involve factual issues regarding accident, causal connection, the nature and extent of the injury, and the employer’s potential defenses, and these are proper subjects for the Commission in the first instance. In cases involving a determination of an employee’s entitlement to workers’ compensation benefits and the employer’s defenses to the claim, the circuit court’s role is appellate only. Gunnels v. Industrial Comm’n, 30 Ill.2d 181, 185, 195 N.E.2d 609, 611 (1964). Accordingly, we find that the circuit court did not err in dismissing count III for a lack of jurisdiction.

Accordingly, the circuit court’s decision to dismiss count I and count III of the complaint with prejudice is affirmed, and the cause is remanded for further proceedings.

Affirmed; cause remanded.

SPOMER, J., concurs.Justice GOLDENHERSH, concurring in part and dissenting in part:

I concur with the majority’s disposition with regard to count III. As to count I, however, I respectfully dissent.

In general, a physician does not owe a duty to a nonpatient third party in regard to his or her treatment of a patient. Brewster v. Rush-Presbyterian-St. Luke’s Medical Center, 361 Ill.App.3d 32, 36, 836 N.E.2d 635, 638 (2005). However, the instant case does not present a physician-patient relationship. Dr. Watters and Primary Care were not acting as treating physicians but, rather, were certifying that Atkinson was physically qualified to drive a commercial motor vehicle. Section 391.11 of Title 49 of the Code of Federal Regulations sets forth the general qualifications of drivers as follows:

“(a) A person shall not drive a commercial motor vehicle unless he/she is qualified to drive a commercial motor vehicle. Except as provided in § 391.63, a motor carrier shall not require or permit a person to drive a commercial motor vehicle unless that person is qualified to drive a commercial motor vehicle.

(b) Except as provided in subpart G of this part, a person is qualified to drive a motor vehicle if he/she-

* * *

(4) Is physically qualified to drive a commercial motor vehicle in accordance with subpart E-Physical Qualifications and Examinations of this part[.]”49 C.F.R. § 391.11(a), (b)(4) (2005).

In order for a certificate of physical examination to be issued, a medical examiner is required to examine a prospective driver and record the results in accordance with several instructions, including in pertinent part the following: “Spine, musculoskeletal.Previous surgery, deformities, limitation of motion, and tenderness should be noted. Findings may indicate additional testing and evaluation should be conducted.”  49 C.F.R. § 391.43(f) (2005).

This was a preemployment examination with the intended recipient consumer being a prospective employer, such as plaintiff. In the instant case, Dr. Watters’ examination report specifically noted that Atkinson had no previous spinal injury or disease, no chronic low back pain, and no previous surgery, deformities, limitation of motion, or tenderness in his spine or other musculoskeletal areas. According to the pleadings, which we are required to accept as true at this stage in the proceedings, Atkinson has “obvious scars” on his back from his previous back surgeries. Accordingly, Dr. Watters, upon examination, would have discovered that Atkinson misrepresented his history about no previous spinal injuries and no chronic low back pain. Plaintiff alleges that Dr. Watters is a partner, employee, and agent of Primary Care, thereby premising liability on a respondeat superior basis.

After careful consideration, I believe that the alleged injury was reasonably foreseeable. Dr. Watters was aware that the examination he was performing on Atkinson was to certify him as medically fit to operate a commercial motor vehicle. Dr. Watters knew that if he certified Atkinson as medically fit to perform the job, potential employers would rely on that certification. Conversely, Dr. Watters was aware that if he refused to certify Atkinson as medically fit, potential employers would refuse to employ Atkinson on that basis.

In Renslow v. Mennonite Hospital, 67 Ill.2d 348, 367 N.E.2d 1250 (1977), the Illinois Supreme Court allowed a nonpatient third party with no patient-hospital or patient-doctor relationship to maintain a cause of action against a hospital and doctor. In Renslow, a child not yet conceived at the time negligent acts were committed against its mother by a doctor and hospital employees was allowed to sue for that negligence directed against its mother. A wrong against one person may invade the protected rights of one who has a special relationship with the first party because the law recognizes a limited area of transferred negligence. Renslow, 67 Ill.2d at 357, 367 N.E.2d at 1255.

This is not a situation in which the plaintiff is an unidentifiable third party. Dr. Watters was aware of the nature of this examination and knew that a potential employer would rely on the results of the examination in making a decision with regard to hiring or not hiring Atkinson. I, therefore, find the relationship between Dr. Watters, Primary Care, and plaintiff to be the type of relationship in which it is reasonable to impose a duty. The injury to plaintiff in hiring a prospective employee with undisclosed previous back problems is clear. If plaintiff had been made aware of Atkinson’s previous back problems, it might not have hired him and might not have become liable to Atkinson under the Act.

I disagree with Dr. Watters’ and Primary Care’s assertion that by finding they owed a duty to plaintiff, they would be required to guard plaintiff from every conceivable injury that Atkinson could incur during the course of his employment. However, hiring a driver with previous back problems increases the likelihood of another back injury to that driver. The medical examination was intended to disclose any previous back injuries, deformities, surgeries, or pain. This burden is not onerous. It requires a doctor to exercise due care when performing an examination on a prospective commercial truck driver.

After considering the circumstances here in which Atkinson allegedly injured his back while working for plaintiff, I would find that Dr. Watters and Primary Care owed a duty to plaintiff to exercise due care when performing the physical examination on Atkinson. Accordingly, I would find the trial court erred in granting the motion to dismiss count I on the basis that Dr. Watters and Primary Care owed no duty to plaintiff in regard to Atkinson’s medical examination.

Lewis v. Atlas Van Lines, Inc.

C.A.3 (Pa.),2008.

United States Court of Appeals,Third Circuit.

Richard J. LEWIS; Patricia A. Lewis, Appellants,

v.

ATLAS VAN LINES, INC.

No. 07-2688.

Argued June 3, 2008.

Filed: Sept. 9, 2008.

OPINION

JORDAN, Circuit Judge.

This appeal involves a claim by Richard and Patricia Lewis against Atlas Van Lines, Inc. (“Atlas”) for damages incurred as a result of Atlas’s failure to live up to its promise to move the Lewises’ household belongings by a date certain. The District Court dismissed the Lewises’ claim, concluding that they had failed to comply with the procedural requirements of 49 U.S.C. § 14706, also known as the “  Carmack Amendment,” or, for purposes of this opinion, the “Amendment.” While we agree with the District Court as to one aspect of its ruling, as more fully explained herein, we disagree that the Lewises’ claim for damages in the amount of additional mortgage payments they had to make and the lost profit on the sale of their home was insufficient to comply with the Carmack Amendment and applicable regulations. We will therefore vacate the District Court’s order dismissing the case and remand for further proceedings.

I. Standard of Review & Jurisdiction

The District Court had jurisdiction pursuant to 28 U.S.C. § 1331. We have jurisdiction under 28 U.S.C. § 1291. The standard of review for a dismissal under Federal Rule of Civil Procedure 12(b)(6) is de novo.Phillips v. County of Allegheny, 515 F.3d 224, 231 (3d Cir.2008). In conducting our review, we must “accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.”Id. at 233.

II. Background

Consistent with our standard of review, we recite the facts of the case in the light most favorable to the Lewises. The Lewises owned and lived in a house in Glen Rock, Pennsylvania. On July 19, 2004, as part of a planned move to New York, they entered into a contract to sell that residence. The sales agreement provided that the Lewises would deliver “a vacant building” to the buyer at the time of the closing, which was scheduled for August 27, 2004. (Appellee App. at A24 ¶¶ 6-8.) Well aware of the need to move their belongings quickly to comply with the terms of the sales agreement, the Lewises solicited a bid from Atlas’s local agent, Warners Moving and Storage (“Warners”), explicitly informing Warners that their house had to be empty before August 27. The Lewises also informed Warners that they had purchased a new home in New York and that they intended to use the proceeds from the sale of their Pennsylvania home to pay for it.

Warners assured the Lewises that, if hired, it would have their Pennsylvania residence emptied by August 26, the day before the closing was scheduled to occur. On July 27, 2004, a Warners sales representative executed an agreement with the Lewises providing that “Warners Moving and Storage will arrive at your home on 8/23 & 8/24 to box the household belongings with loading the household effects on 8/25 & 8/26. Delivery is scheduled for 8/31 or 9/1.”(Appellee App. at A42.)

However, notwithstanding its explicit promise, made with full awareness of the Lewises’ obligation to present an empty home at closing on August 27 and their need to pay for their new home in New York, Warners dramatically failed to fulfill its commitment. On August 23 and 24, Warners did pack the Lewises’ belongings as required, and on August 25, Warners did provide a moving van at the Lewises’ residence, and began loading the belongings into the van. Despite its obligation to complete the loading by the following day, though, and knowing full well the possible consequences to the Lewises, Warners advised the Lewises that the moving van was leaving that evening because the tractor and crew were needed to handle a move to North Carolina for another customer the next day.

The Lewises were still left believing that another crew would appear with a tractor trailer to finish their move as scheduled. But, on August 26, the day it had agreed to complete the loading, Warners failed to show up at the Lewises’ home. Obviously concerned, the Lewises attempted to contact Warners. No one from Warners appeared at the Lewises’ home that day, and no one from Warners offered any explanation for the delay. Nor did Warners appear on August 27, the day of the closing. Aware that the real estate transaction was in serious jeopardy, the Lewises again tried to contact Warners and eventually spoke to Jeff Warner at around noon on August 27.Mr. Warner advised the Lewises that there were no licensed drivers available to deliver a moving van to their residence.

Later that day, the Lewises attended the scheduled closing. Not surprisingly, given Warners’ failure to perform as promised, the Lewises were unable to deliver a vacant home to the purchasers. The purchasers refused to go through with the sale. Warners did not complete the loading of the Lewises’ belongings until August 29, and did not deliver them to New York until September 3, 2004.

When the Lewises’ belongings arrived at their new home in New York, Richard Lewis acknowledged their receipt by signing a Household Goods Bill of Lading and Freight Bill. That document provided that “as a condition precedent to recovery, a claim for any damage … or delay, must be filed within nine months after delivery…. When a claim is not filed … in accordance with the foregoing provisions, carrier shall not be liable and such a claim shall not be paid.”(Appellee App. at A139.)

The following month, on October 26, 2004, the Lewises’ attorney sent a letter to Warners requesting compensation for losses incurred because of Warners’ failure to timely perform as promised under the parties’ agreement. The letter requested damages equal to the “loss of profit on the sale of their residence, additional mortgage payments that Mr. and Mrs. Lewis have had to pay on two mortgages on their Pennsylvania residence which otherwise would have been paid off at closing, and various other miscellaneous expenses they would not have otherwise incurred.”(Appellee App. at A150.) The letter went on to explain that the Lewises could not provide an exact dollar amount for their losses “until they are able to sell their Pennsylvania residence.”(Appellee App. at A151.) Shortly thereafter, on November 4, 2004, Warners’ counsel sent a letter to the Lewises’ attorney acknowledging receipt of the October 26, 2004 letter, and requesting additional information and documentation.

On March 14, 2005, the Lewises entered into a new contract to sell their Pennsylvania property. The sale closed on June 3, 2005, at a price approximately $35,000 lower than the amount the Lewises would have received under the prior sales agreement, had that transaction been completed. During the nine-month period between the delivery of their belongings to New York and the sale of their Pennsylvania residence, the Lewises paid approximately $9,000 in mortgage payments on the Pennsylvania residence, approximately $1,600 in additional utility bills, and over $28,000 in additional taxes.

On November 9, 2005, the Lewises sent a letter to Warners fully explaining their damages and providing a detailed spreadsheet showing the expenses incurred because of Warners’ failure to keep its promises. Warners refused to pay, and the Lewises were compelled to file suit.

In their complaint filed on August 23, 2006 against Atlas in its capacity as Warners’ principal, the Lewises asserted claims for breach of contract and negligence and sought approximately $72,000 in damages. Atlas, relying on the Carmack Amendment, removed the case to the United States District Court for the Middle District of Pennsylvania. Atlas then filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). It argued that the Lewises’ state law claims were preempted by the Amendment and that the Lewises could not obtain relief under that statute because they had not complied with an associated regulation, 49 C.F.R. § 370.3, which requires a shipper to file a claim “for a specified or determinable amount of money” with the carrier within the time limits specified in the bill of lading.

On January 30, 2007, the District Court denied Atlas’s motion to dismiss, concluding that the Carmack Amendment did not preempt the Lewises’ state law claims. However, on May 30, 2007, the District Court granted Atlas’s motion for reconsideration and dismissed the case. In doing so, the District Court agreed with Atlas that the Lewises’ state law claims were preempted and that the Lewises had not complied with the cited regulation. This appeal followed.

II. Discussion

Subsection (a)(1) of the Carmack Amendment, 49 U.S.C. § 14706(a)(1), provides in relevant part that:

A carrier providing transportation or service … shall issue a receipt or bill of lading for property it receives for transportation…. That carrier … [is] liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property….

At oral argument, counsel for the Lewises correctly conceded that the Amendment preempts the Lewises’ state law claims against Atlas.See, e.g., Ga., Fla. & Atlantic Ry. Co. v. Blish Milling Co., 241 U.S. 190, 196, 36 S.Ct. 541, 60 L.Ed. 948 (1916) (explaining that the Carmack Amendment covers “all losses resulting from any failure to discharge a carrier’s duty as to any part of the agreed transportation”); Moffit v. Bekins Van Lines Co., 6 F.3d 305, 306 (5th Cir.1993) (holding that the Carmack Amendment preempted state law claims by a consumer shipper against a moving company based on late delivery of the shipper’s belongings).

As to claims under the Carmack Amendment itself, subsection (e)(1) provides that “a carrier may not provide … a period of less than 9 months for filing a claim against it under this section….”49 U.S.C. § 14706(e)(1). The contents of a valid claim are set forth in 49 C.F.R. § 370.3.Pursuant to subsection (b) of that regulation, a claim for “loss, damage, or delay to cargo” must include:

A written or electronic communication … from a claimant, filed with a proper carrier within the time limits specified in the bill of lading … and:

(1) Containing facts sufficient to identify the baggage or shipment (or shipments) of property,

(2) Asserting liability for alleged loss, damage, injury, or delay, and

(3) Making claim for the payment of a specified or determinable amount of money,

shall be considered as sufficient compliance with the provisions for filing claims embraced in the bill of lading….

Consistent with subsection (e)(1) of the Amendment, the bill of lading that Atlas gave to the Lewises required that, “as a condition precedent to recovery, a claim for any damage … or delay, must be filed within nine months after delivery…. When a claim is not filed … in accordance with the foregoing provisions, carrier shall not be liable and such a claim shall not be paid.”(Appellee App. at A139.) Atlas delivered the Lewises’ belongings to their new home in New York on September 3, 2004. Thus, pursuant to the bill of lading and the Amendment, the Lewises had until June 3, 2005 to provide Atlas with notice of their claim in a manner that complied with 49 C.F.R. § 370.3(b).

On appeal, the parties do not dispute that the October 26, 2004 letter sent by the Lewises’ attorney to Atlas satisfies the requirements found in § 370.3(b)(1) and (b)(2). They disagree, however, on whether that letter makes a claim for a “specified or determinable amount of money,” as required by § 370.3(b)(3). The Lewises argue that the letter makes a claim for a determinable amount of money because it identifies their losses as the “loss of profit on the sale of their residence, additional mortgage payments that [they] have had to pay on two mortgages on their Pennsylvania residence which otherwise would have been paid off at closing, and various other miscellaneous expenses they would not have otherwise incurred.”(Appellee App. at A150.) According to the Lewises, listing the nature of their damages renders their claim “determinable” because those damages are “susceptible of being determined, found out, definitively decided upon, or settled.”(Appellant Br. at 17.) Atlas responds that, to make a claim for a determinable amount of money, the Lewises’ claim must include, at minimum, some dollar amount, and the October 26 letter fails to provide “any dollar amount whatsoever.” (Appellee Br. at 9, 26.) We agree with the Lewises that the October 26, 2004 letter stated a claim for a determinable amount of money as to the amount of their extra mortgage payments and the difference between the price at which they would have sold their Pennsylvania home, but for Warners’ actions, and the lower price at which the home ultimately sold. However, a claim for “miscellaneous” expenses is too vague to constitute a claim for a determinable amount of money, as contemplated by the regulation, and hence Atlas is not liable for those expenses.

We begin our analysis of § 370.3 with the rule that “[t]he basic tenets of statutory construction apply to construction of regulations and ‘our starting point on any question concerning the application of a regulation is its particular written text.’”Pa. Fed’n. of Sportsmen’s Clubs, Inc. v. Kempthorne, 497 F.3d 337, 351 (3d Cir.2007) (quoting Wilson v. U.S. Parole Comm’n, 193 F.3d 195, 197 (3d Cir.1999)). In examining a regulation’s text, “[i]t is a fundamental canon of … construction … that unless otherwise defined, words will be interpreted as taking their ordinary, contemporary, common meaning.”CSX Transp. Co. v. Novolog Bucks County, 502 F.3d 247, 257 (3d Cir.2007) (citations and internal quotation marks omitted).

As noted already, § 370.3(b)(3) requires that a valid claim include a “written communication … [m]aking [a] claim for the payment of a specified or determinable amount of money.”49 C.F.R. § 370.3(b)(3) (emphasis added). Because the regulation does not define the meaning of the term “specified” or the term “determinable,” we must apply the ordinary meaning of those words. “Determinable” simply means “[a]ble to be determined or ascertained.”Black’s Law Dictionary (8th ed.2004). “Specify,” by contrast, means “to mention or name in a specific or explicit manner: tell or state explicitly or in detail.”Webster’s Third New International Dictionary, 2187 (Philip Babcock Gove, ed.1961) (1986). The plain meanings of “specified” and “determinable” reveal a key difference between them and hence between the kinds of claims permitted by the regulation. A claim for a “specified amount of money” is a claim that explicitly gives the dollar amount of money being claimed. However, a claim for a “determinable amount of money” need not explicitly state the dollar amount claimed. Instead, a claim is “determinable” if the amount of money claimed is merely “[cap]able of being determined or ascertained.”Notably, because a claim for a “specific amount of money” must state the amount explicitly, such claims must be reduced to an exact dollar amount at the time the claim is made. By contrast, a claim that is “determinable” need not include any dollar amount at all. Instead, all that is required is that the claim provide enough information to make it possible to assign a dollar amount to the claim at some point after the claim itself is filed.

Our conclusion that “specified” claims under § 370.3(b)(3) include exact dollar amounts while “determinable” claims do not is not only consistent with the ordinary usage of both terms, it is also consistent with another canon of statutory and regulatory construction. We have explained that “[i]f possible, we must give effect to every clause and word of a statute, and be reluctant to treat statutory terms as surplusage.”Tavarez v. Klingensmith, 372 F.3d 188, 190 (3d Cir.2004) (citations and internal punctuation and quotation marks omitted). Were we to accept Atlas’s invitation to require that every claim must provide some dollar amount to comply with subsection (b)(3), we would be treating the term “determinable” as merely redundant of the term “specified,” and would be ignoring the use of the word “or” between the two terms.

Atlas attempts to evade the ordinary meaning of the regulation’s language and the basic rules of textual construction by arguing that, while a “determinable” claim need not include the exact amount of the shipper’s claim, it must include some dollar amount. We find no support for Atlas’s reading, either in the text of the statute itself or in common sense. Requiring a shipper to list some dollar amount presents the shipper with some limited options. The shipper might list a single dollar amount, such as “$100.00.” As we have already explained, such a claim is a claim for a “specified” amount of money, not a “determinable” amount of money. Second, a shipper might list an estimate of its damages, for example, by filing a claim for “$100 more or less.” Without further amplification, such a claim is not for a specified or determinable amount of money because 49 C.F.R. § 370.3(d) provides that:

[w]henever a claim is presented … for an uncertain amount, such as ‘$100 more or less,’ [the carrier] shall ascertain as nearly as possible the extent, if any, of the loss or damage for which it may be responsible. It shall not, however, voluntarily pay [such] a claim unless and until a formal claim in writing for a specified or determinable amount of money shall have been filed in accordance with the provisions of paragraph (b) of this section.

The implication of the clause “until a formal claim in writing for a specified or determinable amount of money shall have been filed” is that a claim like “$100 more or less” is different from and does not meet the “specified or determinable” standard.

However, we do not read § 370.3(d) to bar all claims that are less than fully specific regarding the dollar amount at stake. Instead, the plain meaning of the word “determinable” leads us to conclude that § 370.3(d) bars claims that include estimated dollar amounts only when the claim does not contain sufficient information to put the carrier on notice of the nature and extent of its liability. Cf. Trepel v. Roadway Exp., Inc., 194 F.3d 708, 712 (6th Cir.1999) (holding § 370.3(b)(3) was satisfied when the nature of the shipper’s damages was not in dispute and the shipper estimated those damages at $150,000); Ins. Co. of N. Am. v. G.I. Trucking Co., 1 F.3d 903, 904-05 (9th Cir.1993) (applying a “substantial performance” standard to § 370.3(b) and holding that a claim satisfied § 370.3(b)(3) when the shipper identified the shipment at issue, provided supporting documentation, and estimated his damages at $100,000).

Beyond the unwarranted twist Atlas’s argument gives to the plain meaning of “determinable,” the argument also violates an important purpose of the statute. “The purpose of the written claim requirement is to insure that the carrier may promptly investigate claims, and not to permit the carrier to escape liability.”S & H Hardware & Supply Co. v. Yellow Transp. Inc., 432 F.3d 550, 554 (3d Cir.2005). The “crux of the notice [under § 370.3(b) ] is whether it apprises the carrier of the basis for the claim and that reimbursement will be sought.”Id. Valid claims are determinable not because they include some dollar amount, but because they provide enough information about the nature and extent of the carrier’s liability to allow the carrier to understand its potential exposure to liability. See G.I. Trucking Co., 1 F.3d at 906 (explaining that “the form of the written notice is less important than its adequacy in apprising the carrier of the basis for the claim and the fact that reimbursement will be sought.”). Thus, although a valid claim will often include an estimate of the shipper’s damages along with enough factual information to inform the carrier of the basis for the claim, a dollar amount is not an absolute requirement. See id.(stating that “[o]ther circuits … have held that a claim must specify an amount of damages to be considered legally sufficient under the regulations…. We expressly reject this conclusion.”) (citations omitted).

We conclude that, as to part of what they demanded, the Lewises’ October 26, 2004 letter provides a sound example of how a shipper may give proper notice to a carrier of a determinable claim without including a dollar amount. The letter informed Atlas that it was being asked to pay for the loss of profit on the sale of their residence and for additional mortgage payments that Mr. and Mrs. Lewis would have to pay on their Pennsylvania residence which otherwise would have been paid off at closing. (Appellee App. at A150.) The letter went on to explain that the Lewises could not provide an exact dollar amount for their losses “until they are able to sell their Pennsylvania residence.”(Appellee App. at A151.) Based on the information provided to it by the Lewises, Atlas knew the nature of that claim, and how the amount of it would ultimately be determined.Section 370.3(b) requires nothing more.

However, the Lewises’ additional demand that they be reimbursed for “miscellaneous expenses” requires different treatment. Unlike their claim for lost profit and payment of additional mortgage liability, that claim is not determinable because it does not inform Atlas of the nature of the claim or the extent of Atlas’s liability. Hence, with respect to that claim, the Lewises did not file a “determinable” claim within the nine months specified by the bill of lading, and Atlas is not liable to them for whatever those expenses may be.

Finally, Atlas urges us to follow other Circuits which, it insists, have held that claims which completely lack dollar amounts cannot satisfy § 370.3(b)(3). We decline the invitation. As already explained, our analysis of the text of the regulation persuades us that a dollar amount is not required.

IV. Conclusion

The District Court erred in concluding that the Lewises’ request for reimbursement for additional mortgage payments and loss incurred by virtue of the decrease in the sale price of their Pennsylvania home were not “determinable” claims under § 370.3(b)(3). Hence, we will vacate the District Court’s order and remand for further proceedings consistent with this opinion.

FN* Honorable William H. Yohn, Jr., Senior Judge, United States District Court for the Eastern District of Pennsylvania, sitting by designation.

We are unable to tell from the record whether Jeff Warner was a principal of Warners or simply an employee.

While $28,000 may seem an extraordinary tax liability under these circumstances, the Lewis’s explained in a November 9, 2005 letter to Atlas that approximately $20,000 of that figure represented federal income taxes that they were required to pay as a penalty for withdrawing money from a 401(k) account. They assert that they withdrew the money so that they could purchase their home in New York, a step they would not have had to take if they had been able to sell their Pennsylvania home as planned.

Although the Lewises concede that the Carmack Amendment governs their claims, they urge us to exempt them entirely from complying with the claim filing requirements set out in 49 C.F.R. § 370.3. Relying on Wisconsin Packing Co. v. Indiana Refrigerator Lines, Inc., 618 F.2d 441 (7th Cir.1980), the Lewises contend that § 370.3 does not apply to them because Atlas has chosen to contest their claim. Were we writing on a clean slate, the Lewises’ argument might have greater force because, as the Seventh Circuit pointed out in Wisconsin Packing, § 370.3 explicitly refers only to claims paid “voluntarily” by a carrier. Id. at 445.However, the Lewises’ reading of the regulation is foreclosed by our recent decision in S & H Hardware & Supply Co. v. Yellow Transp., Inc., 432 F.3d 550, 556 (3d Cir.2005) (explaining that “[a]s a matter of public policy, the [regulation] is intended to provide carriers with an opportunity to investigate claims, so it reaches its full usefulness precisely when a carrier wishes to contest a claim”).

The regulations found in 49 C.F.R. § 370.3 went into effect in 1997 and are also found in 49 C.F.R. § 1005.2. As a result, several of the cases we discuss in this opinion cite to 49 C.F.R. § 1005.2 rather than 49 C.F.R. § 370.3. However, the two provisions are identical. See Motor Carrier Routing Regulations; Disposition of Loss and Damage Claims and Processing Salvage; Preservation of Records, 62 Fed.Reg. 32040-01 (June 12, 1997) (explaining that, due to the passage of the Interstate Commerce Commission Termination Act of 1995, it was necessary to “add[ ] to 49 CFR chapter III certain motor carrier transportation regulations, also codified in 49 CFR chapter X.”) For clarity’s sake, we will refer to the regulation as 49 C.F.R. § 370.3 throughout this opinion.

We note that the bill of lading does not appear to contain any reference to the regulation or any requirement that the claim be for a specified or determinable amount of money. We do not imply that such a reference is legally required, but its inclusion may have assisted in the resolution of this dispute before litigation.

Rather than focus on the regulation’s text, the Lewises urge us to adopt a “substantial performance” standard to evaluating claims under § 370.3(b). We have previously noted the possibility of such a standard in dicta. See S & H Hardware, 432 F.3d at 554 (stating that “[c]ourts have construed the written claim requirement liberally, however, and the standard for determining sufficiency is one of substantial performance”) (internal quotation marks and citations omitted). In this case, we may resolve the Lewises’ appeal based on the plain meaning of § 370.3(b)(3). Thus, while we do not reject the application of a substantial performance standard in an appropriate case, we have no reason to consider it here.

Atlas also alleges that the Lewises failed to act in a timely manner because they did not provide it with the final dollar amount of their damages until November 2005, well after the nine-month claim filing period specified in the bill of lading had expired. Atlas’s argument misses the mark because, for the reasons we have explained, the Lewises’ October 26, 2004 letter, which was undisputedly sent within the nine-month period, included a valid claim for a “determinable amount of money” under § 370.3(b)(3).

It was, for example, only after the nine-month time frame that the Lewises described the tax penalty they faced by being forced to withdraw funds from their 401(k) account.

We note, however, that Atlas overstates the holdings of at least two of the cases on which it relies. In Pathway Bellows Inc. v. Blanchette, 630 F.2d 900 (2d Cir.1980), the Second Circuit did not explicitly hold that a dollar amount was required. Instead it held that the shipper’s claim was “inadequate in form” when the relevant portion of the shipper’s claim stated in its entirety that “the purpose of this letter is to state, in writing, that we are in the process of filing a claim for freight damage.”Id. at 901, 904.As we have explained, it is not the lack of a dollar amount that dooms such claims, rather such claims are inadequate because they do not provide a carrier with any information about the nature of the damage incurred, or the extent of the carrier’s liability. In addition, such claims are potentially open-ended in the sense that they do not indicate to the carrier when, or how, the shipper’s claim will be reduced to a dollar amount. In Siemens Power Transmission & Distribution, Inc. v. Norfolk Southern Ry. Co., 420 F.3d 1243, 1246 (11th Cir.2005), the Eleventh Circuit considered a claim that included an estimated damages amount of $25,000, not a claim that entirely lacked a dollar amount. The issue before the Eleventh Circuit was whether “[§ 370.3(b) ] could be construed to invalidate … estimated damages [claims] … on the ground that such a [claim] is not specified or determinable.”Id. at 1252.In the course of deciding that estimated damages amounts were permissible, the Eleventh Circuit noted that other circuit courts had held a shipper’s claim invalid in “situations in which the shipper provided the carrier with no damage amount at all.”  Id. (emphasis in original). However, contrary to Atlas’s contention, nothing in Siemens indicates that the Eleventh Circuit adopted the view that a dollar amount is always required. Instead, it concluded that cases that did not include dollar amounts were inapposite to the issue before it because the claim under consideration included an estimated damages amount. Id. Thus, Atlas’s reading of Siemens is overly broad.