Alert

Jan 21, 2025

Ohio Joins Other States in Enacting Legislation to Govern Disputes Between Motor Carriers and Tow and Storage Providers Involved in Law Enforcement Tows

On January 8, 2025, Governor Mike DeWine signed into law House Bill 403, which enacts § 4513.71 of the Ohio Revised Code and establishes clear dispute resolution protocols to secure expedited release of motor vehicles and cargo from tow and storage companies when billing disputes arise following law-enforcement ordered tows. The new law takes effect April 9, 2025. 

Under the new law, a motor carrier can file a lawsuit against a tow company or storage facility to recover the vehicle and its cargo within two business days, even if an ongoing dispute over the billed amount exists. Notably, the law confers statutory standing to the motor carrier to initiate a civil action for release of the cargo even when the carrier is not the owner of that cargo. 
Previously, motor carriers lacked the ability to pursue relief on behalf of cargo owners, typically their customers, which negatively impacted their customer relationships.

I.    How It Works
If a motor carrier disagrees with a towing or storage invoice, it can file a lawsuit. Within the lawsuit, the trucking company must list the amount it designates as the undisputed value for the tow or storage service provided. Upon filing of the complaint, the trucking company must also pay this undisputed amount to the tow or storage company.

With respect to the portion of the tow and storage invoice that the motor carrier disputes, the trucking company must provide evidence and post a bond with the court equivalent to the disputed amount at the time it files its complaint. It is then left to the court to determine the value of the services conferred. 

Upon filing of a complaint that complies with the statute, and payment of the undisputed amount to the tow and storage provider, the tower or storage facility must release the motor vehicle, cargo, and any personal property to the trucking company within two business days. 

Under the provisions of the new law, tow and storage companies can also initiate litigation following law enforcement tows if a motor carrier fails to pay a tow and storage invoice within 45-days of receipt, but only if the tow and storage provider is not seeking title to the motor vehicle pursuant to Ohio Revised Code § 4505.104 until after judgment. Under the law, a motor carrier can respond to the complaint by paying the undisputed amount and following similar protocols as to the above regarding the disputed amount.

II.    Takeaway

The new legislation strikes a balance between the importance of getting trucks and cargo released and returned to service immediately, while providing a clear legal framework for bona fide invoice disputes between towers, storage providers, and motor carriers.

Complaints brought by either tow companies or motor carriers under the statutory framework must be supported by evidence of the disputed amount at the time of filing. 

Ultimately, if the court determines that the amount charged was unreasonable, the court shall determine a reasonable amount and order the trucking company to pay that amount minus the undisputed amount that the owner previously paid to the towing service or storage facility. The court may also require either party to pay or refund any additional amount and may impose any monetary penalties that the court determines to be appropriate. The potential for excess liability and court-imposed penalties incentivizes all parties to engage in thoughtful analysis of their claims.

The new law was a direct result of negotiations between the Ohio Trucking Association and the state’s two tow and recovery associations and seeks to bridge a gap in the exceptionally volatile and contentious area of tow and storage invoice disputes.