Claiming Economic Loss against tow company

[legalinquiry_01]

Milwaukee, Wisconsin

Hi everyone,
I have a little unique situation. I want to know if it's possible to claim an economic loss that involves physical property. I have a trailer that was towed from a truck stop by a towing company. I called the towing company within their business hours to claim and recover my trailer (same day it was towed), but they refused to return my trailer to me. They did this intentionally and on purpose (not an accident). Consequently, I lost work/freight for that weekend. I already had arrangements booked and prepared to pickup the freight before the tow. But after they towed the trailer and wouldn't return it ( on purpose), I had to cancel arrangements. The freight was worth thousands of dollars. I spoke with some local lawyers about this, but they said the economic loss doctrine could prevent me from making a claim. I feel there has to be a way to make a claim. If people can make claims for intellectual property infringement, there has to be a way to do it for physical property. This happened in Milwaukee Wisconsin. Furthermore, there were other issues in this situation, such as lack of signs in the area where I parked the trailer. Any help is appreciated.

Thanks

 

[Taxing Matters]

You posted the same question on another legal forum, and I answered your query there. For the ease of reference for others reading it here, I'll repeat my answer on this forum too.

I called the towing company within their business hours to claim and recover my trailer (same day it was towed), but they refused to return my trailer to me. They did this intentionally and on purpose (not an accident).

How do you know it was intentional and what reason was given for holding it? What did your contract say about how long the vehicle would be held? And when you contracted with the towing firm, did you tell the firm it was important to get the vehicle back before some specific time because if you didn't you'd suffer loss of business of $X?

Consequently, I lost work/freight for that weekend. I already had arrangements booked and prepared to pickup the freight before the tow. But after they towed the trailer and wouldn't return it ( on purpose), I had to cancel arrangements. The freight was worth thousands of dollars. I spoke with some local lawyers about this, but they said the economic loss doctrine could prevent me from making a claim.

Yours is a situation that falls under contract law. The attorneys with whom you spoke mentioned that the economic loss doctrine would preclude you from an award here. The economic loss doctrine states that that in a contract case a party cannot recover for damages in tort (e.g. negligence damages). As a Wisconsin Court explains:

Here, Magestro initially alleged causes of action for both negligence and breach of contract. Pekul filed a motion for partial summary judgment to dismiss the negligence claims based upon the economic loss doctrine, claiming that Magestro's losses were solely economic in nature and therefore he could not recover under tort theories of negligence. The trial court agreed and dismissed all of the negligence claims. The only claims remaining were breach of contract claims and therefore the economic loss doctrine was no longer applicable. We agree with Magestro's attorney who stated before the trial court:​

I guess I would just like to make a comment about this economic loss doctrine because I understand that you are keeping a lot of these damages out based on the economic loss doctrine, which is a theory that is used in tort cases. The economic loss doctrine is used to preclude damages suffered by somebody in tort when there is a contract in place. I don't think that the economic loss doctrine has any applicability in this case because we're speaking now strictly of a breach of contract and whether or not there are consequential damages flowing from that breach of contract.... [Y]our Honor, if you are dismissing any of these damages based on the economic loss doctrine, I have to respectfully, completely disagree with you because I don't think the economic loss doctrine has any applicability in this case because we're talking about a breach of contract. (Emphasis added.)​

¶ 8 Because the trial court dismissed all the negligence claims pursuant to the economic loss doctrine, the economic loss doctrine has no further applicability to the remaining breach of contract claims. ​

​

Magestro v. N. Star Env't Const., 2002 WI App 182, ¶¶ 7-8, 256 Wis. 2d 744, 750–51, 649 N.W.2d 722, 725.

So if you were alleging damages due to negligence of the tow company the damages that occurred from that negligence may not be recovered. I'm not seeing a negligence claim here, though I also don't have all the facts. In any event, you'd not get damages for negligence out of this. But that's not the end of the matter.

In contract law there are two categories of breach of contract damages: direct damages and consequential damages. When a contract is breached, you are entitled to direct damages that result from the breach. An example of that is if the tow company had damaged your vehicle while towing it. That's a damage directly incurred from the act you contracted the company to do — tow the vehicle.

Consequential damages are indirect damages that result from the breach. Loss of profit from other work you could have had while the truck was idle is a common example of consequential damages. The key thing here is that the the consequential damages must be reasonably foreseeable to the breaching party at the time the contract was for you to be awarded them. "Consequential damages may be awarded for a breach of contract if such damages are reasonably foreseeable at the time the contract was made." Trenhaile v. J.H. Findorff & Son, Inc., 2004 WI App 125, ¶ 16, 275 Wis. 2d 275, 683 N.W.2d 93

Often it is not obvious to the breaching party that those damages will occur. That party may not have any reason to know you'd loss business and how much profit was at stake. For that reason, you generally want to put the other party on notice of any losses like that which may occur when you are making the contract so the other party knows what is at stake. Failure to do that might mean you don't get that lost profit. And, of course, you have to prove that the lost profit with reasonable certainty.

So, just based on what you said here, I'm not seeing that your problem is with the economic loss doctrine. I see the problem as a consequential damages issue. Without more information on what the contract said about when you'd get the vehicle back, the reason for the delay, and what reasons the tow company would have to know you'd have lost profit, I can't say whether you might have a good claim to get that. As you can see, there is a lot you have to prove to win it: that the contract was breached, the breach was the cause of the loss profit, what the amount of lost profit was, and that this loss was reasonably foreseeable to the breaching party or that he had been specifically put on notice of that potential loss at the time the contract was made. And it bears repeating: you'd get only lost profit, not the total amount of charges you'd have billed for the lost jobs.

 

[Zigner]

As I mentioned on the other forum, this sounds like the OP had the trailer parked where it wasn't supposed to be parked, so it was towed. I don't believe that's contract law.

I think the OP wants to recover "damages" against the towing company for his loss of revenue due to their refusing to return the trailer. The OP goes to great pains to point out that they did it "on purpose", but that really isn't relevant. Absent some truly uncontrollable event, any refusal to return the trailer would be "on purpose".

 

[Just Blue]

Milwaukee, Wisconsin

Hi everyone,
I have a little unique situation. I want to know if it's possible to claim an economic loss that involves physical property. I have a trailer that was towed from a truck stop by a towing company. I called the towing company within their business hours to claim and recover my trailer (same day it was towed), but they refused to return my trailer to me. They did this intentionally and on purpose (not an accident). Consequently, I lost work/freight for that weekend. I already had arrangements booked and prepared to pickup the freight before the tow. But after they towed the trailer and wouldn't return it ( on purpose), I had to cancel arrangements. The freight was worth thousands of dollars. I spoke with some local lawyers about this, but they said the economic loss doctrine could prevent me from making a claim. I feel there has to be a way to make a claim. If people can make claims for intellectual property infringement, there has to be a way to do it for physical property. This happened in Milwaukee Wisconsin. Furthermore, there were other issues in this situation, such as lack of signs in the area where I parked the trailer. Any help is appreciated.

Thanks

Why was the trailer towed?
Did you go to the tow yard with proof of ownership and $$ to pay the tow/storage fees?
What reason did they give for not releasing the trailer?

 

[Taxing Matters]

As I mentioned on the other forum, this sounds like the OP had the trailer parked where it wasn't supposed to be parked, so it was towed. I don't believe that's contract law.

You may be correct. The OP wasn't clear on that and he should clarify if he was the one who had it towed or the truck stop had it towed. I believed contract law to apply because the OP said the lawyers he talked to said the economic loss doctrine would preclude him from recovery. The economic loss doctrine denies recovery for monetary tort claims when there is a contract between the two parties. So, if there was no contract, those lawyers should not have mentioned that doctrine at all.

I think the OP wants to recover "damages" against the towing company for his loss of revenue due to their refusing to return the trailer. The OP goes to great pains to point out that they did it "on purpose", but that really isn't relevant. Absent some truly uncontrollable event, any refusal to return the trailer would be "on purpose".

Whether it was on purpose or not may not be that important, but the reason why the trailer was not returned when asked may be very relevant, depending on whether there was a contract between the OP and the tow company and if so, what the terms of the contract were. It would also matter, should the OP come back to provide more facts, why the vehicle was towed if he's not the one who had it towed. If he didn't have it towed himself, then the truck stop would have to have complied with the applicable state law to justify the tow.

 

[cbg]

Maybe I'm off base because the only times I've ever had a car towed it's because it had broken down and AAA was taking it to the repair shop at my request, but is it the usual thing for the tow shop to "return" the car? Isn't it generally up to the owner to retrieve it?

 

[Zigner]

Maybe I'm off base because the only times I've ever had a car towed it's because it had broken down and AAA was taking it to the repair shop at my request, but is it the usual thing for the tow shop to "return" the car? Isn't it generally up to the owner to retrieve it?

One doesn't generally "claim and recover" their vehicle after a consensual tow. Those are terms one would use when picking their vehicle up from an impound lot.

 

[Zigner]

You may be correct. The OP wasn't clear on that and he should clarify if he was the one who had it towed or the truck stop had it towed. I believed contract law to apply because the OP said the lawyers he talked to said the economic loss doctrine would preclude him from recovery. The economic loss doctrine denies recovery for monetary tort claims when there is a contract between the two parties. So, if there was no contract, those lawyers should not have mentioned that doctrine at all.

Fair enough.

Whether it was on purpose or not may not be that important, but the reason why the trailer was not returned when asked may be very relevant, depending on whether there was a contract between the OP and the tow company and if so, what the terms of the contract were. It would also matter, should the OP come back to provide more facts, why the vehicle was towed if he's not the one who had it towed. If he didn't have it towed himself, then the truck stop would have to have complied with the applicable state law to justify the tow.

I absolutely agree. The OP should fill in some blanks here...

 

[Zigner]

I have a trailer that was towed from a truck stop by a towing company. I called the towing company within their business hours to claim and recover my trailer (same day it was towed), but they refused to return my trailer to me.
...Furthermore, there were other issues in this situation, such as lack of signs in the area where I parked the trailer.

It is these three sentences that make me believe the tow was due to the trailer being parked on private property without permission.


EDIT: Especially the last sentence. Why would the OP care about the signs if he called for the tow?

 

[cbg]

One doesn't generally "claim and recover" their vehicle after a consensual tow. Those are terms one would use when picking their vehicle up from an impound lot.

Right. And much of what is in the posts suggests, while I grant you that it is far from certain, that the tow was not called for by the poster but was done because he parked where he wasn't supposed to.

So why doesn't he hike himself down to the impound lot and claim it? Why is he expecting them to return it?

 

[Zigner]

Right. And much of what is in the posts suggests, while I grant you that it is far from certain, that the tow was not called for by the poster but was done because he parked where he wasn't supposed to.

So why doesn't he hike himself down to the impound lot and claim it? Why is he expecting them to return it?

He said he went there the same day and they refused to release it. He didn't tell us their reason, though.

EDIT: Upon re-reading the post, he said that he called them. I suspect you may be right in that he expected them to bring the trailer back...and that's not how it works.

 

[cbg]

He doesn't say he went there. He says he called them.

I called the towing company within their business hours to claim and recover my trailer (same day it was towed

 

[Zigner]

He doesn't say he went there. He says he called them.

Yep - I corrected myself as you were responding.

 

[quincy]

Milwaukee, Wisconsin

Hi everyone,
I have a little unique situation. I want to know if it's possible to claim an economic loss that involves physical property. I have a trailer that was towed from a truck stop by a towing company. I called the towing company within their business hours to claim and recover my trailer (same day it was towed), but they refused to return my trailer to me. They did this intentionally and on purpose (not an accident). Consequently, I lost work/freight for that weekend. I already had arrangements booked and prepared to pickup the freight before the tow. But after they towed the trailer and wouldn't return it ( on purpose), I had to cancel arrangements. The freight was worth thousands of dollars. I spoke with some local lawyers about this, but they said the economic loss doctrine could prevent me from making a claim. I feel there has to be a way to make a claim. If people can make claims for intellectual property infringement, there has to be a way to do it for physical property. This happened in Milwaukee Wisconsin. Furthermore, there were other issues in this situation, such as lack of signs in the area where I parked the trailer. Any help is appreciated.

Thanks

Why did you abandon your trailer at the truck stop? Or were you with the trailer when it was towed?

 

[legalinquiry_01]

Hi everyone. Thank you for the insightful responses. Sorry for the delay, I was a little busy.

How do you know it was intentional and what reason was given for holding it? What did your contract say about how long the vehicle would be held? And when you contracted with the towing firm, did you tell the firm it was important to get the vehicle back before some specific time because if you didn't you'd suffer loss of business of $X?

To answer your question, the delay was 'on purpose' because several calls were made to the towing company before they released the trailer to me. I called the tow company 8 times between 12:30pm and 5:30pm on a Saturday. They answered each call (except 1 because they started to ignore me after the 7th call). In the first phone call, the manager I spoke with lied about the business hours and said he was closed (this is at 12:30pm). The real business hours are 9am to 1pm on Saturdays. They used the same business hours to tow the trailer, but refused to give it back within their hours of operation. Anyway, the manager continued to lie in each phone call and told me he was closed. He said I would need to pickup the trailer on Monday. I did further investigation of the towing company and realized that the official operating hours are 9am to 1pm. I confronted the tow manager over the phone for lying. He responded by saying 'it doesn't matter what I said earlier, you're not getting the trailer until Monday' (this conversation was around 5:30pm) . After I threatened to sue, someone else from the company gave me a call at around 6:30pm and released the trailer to me at around 7:20pm after paying a ransom of $550 (they said it's normally $500, but $50 is a 'favor fee'- complete bs). However, it was much too late by then. The freight that I was scheduled to pickup was canceled by then. Also, there is an incentive for towing companies to hold vehicles because they can arbitrarily charge storage fees at will. And no, I didn't tell the tow company I needed the trailer by "X o'clock" because I didn't think that was relevant. Why do I need to give a reason to retrieve MY things if I called within the business hours? The trailer is M-I-N-E. That's the only reason I need.

As I mentioned on the other forum, this sounds like the OP had the trailer parked where it wasn't supposed to be parked, so it was towed. I don't believe that's contract law.

Zinger is correct, this was an non-consensual tow. However, there are more issues regarding the parking rules. There were NO signs present in the parking lot prohibiting parked trailers. The trailer was parked at a Loves truckstop. Loves is a franchise, and there are many locations that allow you to park your trailer/truck without worries for up to 24 hours. Whenever parking rules differ from other truckstops, signs are always present. The truckstop I visited didn't have signs (I took pictures of this for my case).

So, just based on what you said here, I'm not seeing that your problem is with the economic loss doctrine. I see the problem as a consequential damages issue. Without more information on what the contract said about when you'd get the vehicle back, the reason for the delay, and what reasons the tow company would have to know you'd have lost profit, I can't say whether you might have a good claim to get that. As you can see, there is a lot you have to prove to win it: that the contract was breached, the breach was the cause of the loss profit, what the amount of lost profit was, and that this loss was reasonably foreseeable to the breaching party or that he had been specifically put on notice of that potential loss at the time the contract was made. And it bears repeating: you'd get only lost profit, not the total amount of charges you'd have billed for the lost jobs.

Taxing Matters, I've thought about framing the loss as a breach of contract, but I'm not sure which contract was breached because I never signed anything and this was a non-consensual tow. However, the tow company should have an obligation to return personal property if people call and request their vehicles WITHIN BUSINESS HOURS. Is it really legal for them to return people's property when they feel like it? This can't be possible. This is why I'm trying to find something that allows me to make a claim.

I also found some other laws in Wisconsin that limit the amount they are allowed to charge.
https://towing.witruck.org/laws/towing-storage-liens/ [ Wis. Stat. ch. 342 ]
My trailer was empty when it was towed, and it's only about 12,000 pounds. According to the rules, anything under 20,000 pounds should only cost $120. Not $550. And no 'favor fee' clauses. I plan to add this to the suit. They completely ripped me off.