Homepage / Fill in a Valid Owner Operator Lease Agreement Template
Table of Contents

The Owner Operator Lease Agreement is a vital document that outlines the relationship between a carrier and an owner operator in the transportation industry. This agreement serves multiple purposes, ensuring that both parties understand their rights and responsibilities before embarking on any transportation services. Key aspects of the form include provisions for securing necessary permits and complying with regulations to operate legally. The owner operator must deliver a minimum amount of freight within a specified timeframe while ensuring that all cargo is transported according to applicable tariffs and service contracts. Moreover, liability considerations are significant; the owner operator agrees to defend and indemnify the carrier against any claims arising from negligence or failure to comply with laws. This agreement also addresses insurance requirements, clearly stating that the owner operator must carry adequate coverage to protect both parties during the transportation process. Importantly, the contract contains clauses regarding confidentiality and the non-assignment of the contract without consent, providing further security for both the carrier and the owner operator. As such, understanding the Owner Operator Lease Agreement form is essential for those engaged in or considering entering the world of freight transportation.

Owner Operator Lease Agreement Example

OWNER OPERATOR LEASE AGREEMENT

THIS agreement, entered into this ____day of ______________20___ between

______________________, (Hereinafter designated as “Carrier”), and

______________________, (Hereinafter designated as “Owner Operator”),

WITNESSETH:

WHEREAS, Owner Operator is engaged in the transportation of general freights of all kinds (FAK) by motor vehicle as a contract Carrier and desires to transport goods for Carrier; and WHEREAS, to facilitate such transportation and for the convenience in handling such transaction, the parties have agreed to the terms and conditions under which transportation shall be made, as hereinafter set forth.

NOW THEREFORE, in consideration of the premises and the mutual promises and conditions herein contained it is hereby agreed as follows:

(1) GENERAL PROVISIONS:

(a)Owner Operator, in its operations hereunder, shall secure all permits, licenses and approvals necessary for the accomplishment of the work to be done hereunder and shall comply fully with all applicable laws, rules, orders and regulation of all governments and agencies thereof, whether federal, state or local, and shall furnish Carrier with satisfactory evidence thereof whenever requested to do so. Among other things, Owner Operator shall provide to Federal Motor Carrier Safety Administration certificate showing Owner Operator holds contract authority from such commission covering the commodities and transportation routes to which this agreement relates, and Owner Operator shall give immediate notice to Carrier of any cancellation or modification of such authority. When transporting hazardous wastes, substances to or materials pursuant this agreement, Owner Operator shall comply with all applicable federal, state and local hazardous wastes, substances or materials laws and regulations and shall furnish Carrier with satisfactory evidence thereof whenever requested to do so.

(b)The Owner Operator hereby agrees to deliver for the Carrier for transportation, not less than the following amount: one shipment of freight of all kinds (FAK) during a period of

____________________. The Owner Operator further agrees, subject to availability and loading tendered for transportation by Carrier.

(c)All such cargo shall be transported hereunder in accordance with this agreement and the provisions of Carrier’s tariff’s or service contracts applicable to such cargo. Cargo shall include any containers in which goods are packed when received by Owner Operator hereunder.

(d)This agreement shall not be modified or altered unless in writing, signed by both parties to this agreement.

(e)This contract shall terminate all previous contracts between the parties hereto relating to the transportation Freight all kinds (FAK) and shall remain in full force and effect for the term of this agreement.

(f)It is to be clearly understood and it is the intention of the parties hereto that Owner Operator shall employ all persons operating trucks hereunder, that such persons shall be and remain the employees of the Owner Operator, that the Owner Operator shall be an independent contractor of the Carrier and that nothing herein contained shall be construed to be inconsistent with that relation or status.

(g)It is further to be clearly understood that where the Owner Operator engages any

subcontractor for any portion of the work hereunder, such engagement will not alter the relationship of the Owner Operator to the Carrier as an independent contractor and shall not establish any relationship or obligation between Carrier and any subcontractor. Owner Operator will continue to be solely responsible for compliance with or performance for any subcontractors actually doing such work and will otherwise defend, indemnify and save harmless the Carrier, its agents and servants from any such claims, liabilities, penalties and fines (whether criminal or civil), judgments outlays and expenses (including attorney’s fees).

(h)Owner Operator shall defend, indemnify and save harmless the Carrier, its agents and servants from any and all liabilities, penalties and fines (whether criminal or civil), judgments, outlays and expenses (including attorney’s fees) resulting from Owner Operator’s failure or the failure of Owner Operator’s agents, employees, subcontractors or representatives to comply with any applicable laws and regulations, whether federal, state or local, or property arising out of the performance of this agreement caused by the acts, failure to act or negligence of Owner Operator, subcontractors, its agent, employees, or representatives.

(i)Owner Operator will assume all liability for and will otherwise defend, indemnify and save harmless the Carrier, its agents or servants from any and all liabilities, penalties and fines (whether criminal or civil). Judgments, outlays and expenses (including attorney’s fees) resulting from any release or discharge of hazardous wastes, substances or materials that occurs during transportation and Owner Operator will assume all responsibility and liability for cleanup of any release or discharge of hazardous wastes, substances or materials that occurs during transportation and will otherwise defend indemnify and save harmless the Shipper, its agents and servants from any and all liabilities, penalties and fines (whether criminal or civil), judgments, outlays and expenses (including attorney fees) resulting from the cleanup of any such release or discharge.

(j)Owner Operator will defend, indemnify and save harmless the Carrier, its agents and servants from any and all liabilities, penalties and fines (whether criminal or civil in nature), judgments, outlays and expenses (including attorney’s fees) resulting from the Owner Operator’s failure or the failure of Carrier’s agents, employees, subcontractors or representatives to perform any of the terms, conditions, promises or covenants contained in this contract.

(k)Carrier shall have full responsibility for all payments, benefits, and rights of whatsoever nature to or on behalf of any of its employees and to ensure that its subcontractor shall have the same responsibility.

(l)It is further agreed by the parties hereto that Owner Operator is not to display the name of Carrier upon or about any of the Owner Operator’s vehicles, without Carrier’s written consent.

(m)Any limitation on or exemption from liability in any tariff, receipt, bill of lading, or other document issued by or on behalf of Owner Operator shall have no legal effect and shall not otherwise apply with respect to shipments tendered by or on behalf of Carrier unless specifically agreed in writing by the Owner Operator. Any limitations on or exemptions from liability contained in a Owner Operator’s tariff, receipt, bill of lading, or other document issued in conjunction with a specific shipment moving under this Contract shall have no legal effect and shall not otherwise be applicable to such shipments.

2.RECEIPTS OF GOODS:

(a)Owner Operator agrees, upon receipt from Carrier of such quantities of Carrier’s goods as may be tendered from time to time under this agreement by Carrier or by a third party on behalf of Carrier to give Carrier a written receipt thereof, which shall be prima facie evidence of receipt of such goods in good order and condition unless otherwise noted upon the face of such receipt; and, in the case of transportation of hazardous wastes, substances or materials such written receipt shall be prima facie evidence of receipt of such wastes, substances or materials in a condition and manner which complies with all applicable laws and regulations, whether federal, state or local. In the event that Owner Operator elects to use a tariff, bill of lading, manifest or other form of freight receipt or contract, any terms, conditions and provisions of such bill of lading, manifest or other form shall be subject and subordinate to the terms, conditions and provisions of this Agreement, and in the event of a conflict between the terms, conditions and provisions of such tariff, bill of lading, manifest or other form and this Agreement, the terms, conditions and provisions of this Agreement shall govern.

(b)Owner Operator agrees to take signed receipts upon forms satisfactory to Carrier from all persons to whom deliveries shall be made, which receipts shall be retained by Owner Operator for at least two (2) years and shall be available for inspection and use of Shipper.

3. CARE AND CUSTODY OF MERCHANDISE:

(a)Owner Operator hereby assume the liability of an insurer of the prompt and safe transportation of all goods entrusted to its care, and shall be responsible to Carrier for all loss or damage of whatever kind and nature and howsoever, caused to any and all goods entrusted to Owner Operator hereunder occurring, while same remains in the care, custody or control of Owner Operator or to any other persons to whom the Owner Operator may have entrusted said goods and before said goods are delivered as herein provided or returned to Carrier.

(b)On occasion, Owner Operator will be requested to transport reefer cargo refrigerated containers. On all occasions, refrigerated containers must be transported with an attached generator set (nose mounted or under-slung) unless specifically advised by Carrier in writing that a generator set is not required. It is the Carrier’s responsibility to ensure a generator set is attached and running properly at the assigned temperature at the time of interchange.

4. INSURANCE:

(a)Owner Operator agrees to be a motor Carrier member in good standing in the Uniform Intermodal Interchange Agreement (UIIA). Owner Operator further agrees to comply with the insurance requirements of the Federal Motor Carrier Safety Administration and the states through which the Owner Operator operates. Owner Operator’s insurance coverage shall, at a minimum, comply with the minimum requirements as stated in the UIIA.

(b)The Owner Operator agrees to carry cargo, personal injury, death, equipment and general insurance and will promptly reimburse Carrier for the value of any goods (including containers) lost or destroyed during the period of Owner Operator’s responsibility under clause (3) (a). All such insurance shall be as additional insured.

(c)The Owner Operator agrees to provide the UIIA with appropriate certification and a copy of each policy of insurance and renewals thereof or other satisfactory evidence that Owner Operator has obtained insurance in compliance with the requirements and terms of this agreement.

(d)The Owner Operator will arrange with its broker and/or insurance Carrier(s) that notice of coverage and limits will be sent directly to the UIIA, as well and cancellation notices and

amendments to coverage(s).

5. ASSIGNMENTS:

This contract cannot be assigned by Owner Operator without the written consent of Carrier.

6. COMPENSATION, COMMODITIES, TERRITORY:

(a)Acceptable rates and charges, rules and regulations, the commodities to be transported, and the points from and to which they shall be transported, are to be furnished the Carrier, the Federal Motor Carrier Safety Administration and other regulatory bodies as may be required, as set forth in the rate schedule attached hereto and made a part hereof. Carrier agrees to pay Owner Operator as full compensation for services to be performed by Carrier under said rules and regulations the rates and charges set forth in the rate schedule, within sixty (60) days of invoice date.

(b)This agreement is to become effective upon signature by Carrier and Owner Operator.

7. CONFIDENTIALITY:

Owner Operator shall treat as confidential, and not to disclose to third parties, the terms of this agreement or any information concerning the Carrier’s business including information regarding suppliers, products and customers without in each instance obtaining Carrier’s written consent in advance.

8. NOTICES:

All notices given pursuant to this agreement shall be given in writing by certified or registered mail, return receipt requested, and addressed as directed by the parties from time to time.

CARRIER: ______________________________________________________________

9. APPLICABLE LAW:

To the extent state law applies, this agreement shall be governed by and interpreted in accordance with the laws of the state of ____________________.

SIGNATURES

OWNER OPERATOR

_______________________________

NAME

CARRIER

_______________________________

NAME

File Breakdown

Fact Name Fact Description
Parties Involved This agreement is between the Carrier and the Owner Operator, who are designated parties to the contract.
Purpose The agreement facilitates the transportation of general freight by the Owner Operator on behalf of the Carrier.
Liability and Indemnification The Owner Operator assumes liability for goods during transportation and agrees to indemnify the Carrier against various claims.
Insurance Requirements The Owner Operator must maintain appropriate insurance coverage and comply with federal and state regulations.
Confidentiality Clause The Owner Operator is required to keep the terms of the agreement confidential unless written consent is obtained from the Carrier.
Termination of Previous Contracts This agreement supersedes all previous contracts regarding the transportation of freight between the parties.
Governing Law The agreement is governed by the laws of the relevant state as specified within the document.
Modification Clause Any modifications to this agreement must be made in writing and signed by both parties to be valid.

Guide to Using Owner Operator Lease Agreement

Completing the Owner Operator Lease Agreement form requires careful attention to detail. Each section must be filled out accurately to ensure mutual understanding and compliance with the terms between the Owner Operator and the Carrier. Follow the steps outlined below to ensure the form is completed correctly.

  1. Begin by entering the date at the top of the form in the space provided for the ____day of ______________20___.
  2. Fill in the name of the Carrier on the next line, where it says ______________________.
  3. Next, enter the name of the Owner Operator where it says ______________________.
  4. In Section 1(a), make sure to note the necessary permits and licenses that Owner Operator needs to secure.
  5. Specify the amount of freight for transportation in Section 1(b), where it states ____________________ for the transportation period.
  6. Read through and understand Section 1(c), as it outlines the compliance with Carrier’s tariffs or service contracts.
  7. Confirm that you agree with the modification clause in Section 1(d) regarding alterations to the agreement.
  8. Make sure Section 1(f) is clear about the independent status of the Owner Operator and their employees.
  9. Review Section 3 for the care and custody obligations, ensuring supplier and customer information is treated confidentially under Section 7.
  10. Indicate the appropriate state in Section 9, where it states the agreement will be governed by the laws of the state of ____________________.
  11. Finally, sign the form where indicated for both Owner Operator and Carrier at the bottom of the document.

Get Answers on Owner Operator Lease Agreement

What is the purpose of the Owner Operator Lease Agreement?

The Owner Operator Lease Agreement establishes the terms and conditions for transportation services between a Carrier and an Owner Operator. It outlines responsibilities, compensation, and compliance with applicable laws, ensuring both parties understand their obligations in the transportation process.

What are the general provisions included in the agreement?

Key provisions include:

  • Owner Operator must obtain necessary permits and comply with legal regulations.
  • Owner Operator is an independent contractor, responsible for hiring its own employees.
  • Subcontracting does not alter the independent contractor relationship.
  • Indemnification clauses protect the Carrier from liabilities caused by Owner Operator's actions.

How is liability addressed in the agreement?

The Owner Operator assumes significant liability. They are responsible for any loss or damage to goods while in their care. Additionally, they must indemnify the Carrier against any legal claims, fines, or losses arising from their operations, including issues related to hazardous materials.

What insurance requirements must the Owner Operator meet?

The Owner Operator must carry essential insurance coverage, including:

  • Cargo insurance
  • Personal injury and death coverage
  • General liability insurance

Verification of insurance compliance must be provided to the Carrier and the UIIA.

Can the Owner Operator modify the agreement?

Modifications to the lease agreement can only be made in writing and must be signed by both parties. Verbal agreements or informal changes will not have any standing.

How is compensation structured in the agreement?

The Carrier agrees to pay the Owner Operator according to a predetermined rate schedule. Payment is expected within 60 days from the invoice date, ensuring timely compensation for services rendered.

What are the confidentiality obligations?

The Owner Operator is required to treat the terms of the agreement and any associated business information of the Carrier as confidential. Disclosure to third parties is not permitted without written consent from the Carrier.

How should notices be communicated between the parties?

All notices must be provided in writing via certified or registered mail, with return receipt requested. Each party's address for notice purposes should be stated in the agreement and may change over time.

Which laws govern the Owner Operator Lease Agreement?

This agreement is governed by and interpreted in accordance with the state laws specified in the document. Parties should be aware of the legal framework applicable to their agreement to ensure compliance.

Common mistakes

Filling out the Owner Operator Lease Agreement form is a critical step for both carriers and owner operators. However, mistakes can lead to misunderstandings and potential legal troubles. Here are eight common errors that individuals often encounter when completing this form.

First, failing to complete all required sections can lead to complications. The form has specific areas that must be filled in, such as names, dates, and specifics of the agreement. Omitting information can result in an incomplete contract, which may not be enforceable in a legal dispute.

Second, individuals sometimes neglect to read the agreement carefully. This oversight can cause misunderstandings about the obligations and rights of each party. It is vital to understand all terms, especially regarding liability and insurance requirements, to avoid future problems.

Another common pitfall involves not providing accurate documentation. Owners operators are required to submit permits and licensing information. Inaccurate or outdated documents could lead to delays or even rejection of the agreement, making it essential to double-check that all paperwork is current and valid.

Fourth, using ambiguous language is a frequent mistake. Clarity is crucial in any legal agreement. Vague statements about responsibilities or compensation can become sources of disagreement. All terms should be as clear and precise as possible to ensure that both parties have the same understanding of the expectations.

Additionally, neglecting to obtain necessary signatures can invalidate the agreement. Both parties must sign the document to indicate their consent to the terms. Without signatures, the contract may be deemed unenforceable, putting both parties at risk.

Sixth, some may overlook the importance of keeping copies of the signed agreement. It is essential to have a personal copy for reference and future consultations. Losing track of the original document can complicate the enforcement of the contract.

Moreover, missing deadlines for submissions is another error that can have serious consequences. The agreement often includes specific timelines for providing documentation and executing tasks. Failing to meet these deadlines can result in penalties or other challenges in the operational relationship.

Lastly, not seeking legal advice can be a significant mistake. Especially for those unfamiliar with legal contracts, consulting with someone knowledgeable can provide insights that help avoid pitfalls. Legal guidance can ensure that the agreement meets all necessary legal standards and adequately protects both parties’ interests.

By being aware of these common errors and taking steps to avoid them, individuals can better ensure that their Owner Operator Lease Agreement is completed accurately and effectively. Thus, fostering a stable and trustworthy working relationship.

Documents used along the form

The Owner Operator Lease Agreement is a critical document in the transportation industry, but several other forms and documents are typically used alongside it to ensure compliance and clarity in the operations. Here are some key documents that often accompany the Owner Operator Lease Agreement:

  • Bill of Lading: This document serves as a receipt for freight services and details specifics about the shipment, including types of goods and their destination. It is legally binding and outlines the responsibilities of the shipper, carrier, and consignee.
  • Insurance Certificates: These certificates provide proof that the Owner Operator has obtained the necessary insurance coverage, including liability and cargo insurance. This document reassures the Carrier that the Owner Operator is compliant with industry standards.
  • Driver Qualification File: This file includes information about the Owner Operator’s driving history, certifications, and compliance with safety regulations. It is essential for demonstrating that drivers meet the necessary qualifications to operate commercial vehicles.
  • Freight Rate Confirmation: This form outlines the agreed-upon rates for the services provided under the lease agreement, detailing the cost aspects of transporting goods. It ensures transparency in billing and payment procedures.

Using these forms in conjunction with the Owner Operator Lease Agreement helps establish a clear framework for operations. Each document plays a vital role in ensuring that all parties understand their obligations and rights, thereby supporting a smooth transportation process.

Similar forms

  • Freight Bill: Similar to the Owner Operator Lease Agreement, a freight bill outlines the details of a shipping transaction, including the service provided and a breakdown of the charges. Both documents require clear identification of parties involved and may include terms of liability and payment.

  • Bill of Lading: This document serves as a receipt for goods and a contract for transportation, parallel to how the Owner Operator Lease Agreement formalizes the transport arrangement. Both documents specify the responsibilities of the parties and details concerning the freight being transported.

  • Transportation Agreement: Like the Owner Operator Lease Agreement, this document sets forth the terms and conditions under which transportation services are provided. Both agreements clarify the obligations of the carrier and owner operator, thus ensuring mutual understanding and legal protection.

  • Independent Contractor Agreement: This type of agreement highlights the independent contractor relationship, similar to what’s defined in the Owner Operator Lease Agreement. Both documents specify the lack of employer-employee relationship between the parties, emphasizing that the owner operator is an independent service provider.

  • Service Contract: This contract establishes the terms for services provided, akin to the Owner Operator Lease Agreement. Both documents typically cover payment terms, scope of work, and other essential conditions necessary for effective service delivery.

  • Insurance Certificate: This document can accompany the Owner Operator Lease Agreement by detailing the insurance coverage carried by the owner operator, ensuring compliance with requirements similar to those stated in the lease agreement itself. Both focus on protection against liabilities during the execution of transport services.

Dos and Don'ts

When filling out the Owner Operator Lease Agreement form, there are some important guidelines to follow to ensure everything goes smoothly. Below is a list of what you should and shouldn’t do.

  • Do read the entire agreement carefully before filling it out.
  • Do provide accurate information about both parties, including names and contact details.
  • Do ensure that any necessary permits, licenses, and insurance documents are in place before signing.
  • Do communicate openly with the Carrier about any specific terms or conditions you want to discuss.
  • Do keep a copy of the signed agreement for your records.
  • Don't leave any blank spaces; if information doesn’t apply, indicate it clearly (e.g., “N/A”).
  • Don't modify the text of the agreement unless both parties agree and sign off on those changes.
  • Don't engage subcontractors without understanding your responsibilities regarding them in the agreement.
  • Don't disclose any confidential information or terms of the agreement without written consent from the Carrier.

By following these guidelines, you can help ensure that the leasing process is clear, compliant, and efficient for all parties involved.

Misconceptions

1. Owner Operators Are Employees of the Carrier: Many believe that Owner Operators are employees of the Carrier. However, Owner Operators are independent contractors. They maintain their own businesses and are responsible for their own expenses.

2. Liability is Shared Equally: There's a common misconception that liability during transportation is shared. In reality, the Owner Operator assumes most of the liability, especially concerning hazardous materials or violations of regulations.

3. All Repairs Are Covered: Some people think that the Carrier covers all repairs and maintenance for the vehicle. In fact, Owner Operators are responsible for their own equipment and maintenance costs.

4. The Agreement Does Not Change: Another myth is that once the agreement is signed, it cannot be modified. While it is true that changes must be in writing, the terms can be updated if both parties agree.

5. Insurance is Optional: Many mistakenly believe that insurance is an option. Owner Operators are required to have specific insurance coverage to comply with federal and state regulations.

6. Payments Are Made Immediately: It’s often assumed that payments to Owner Operators are made immediately after services are rendered. In reality, the Carrier typically processes payments within sixty days of receiving an invoice.

7. No Requirements for Permits: Some think there are no requirements for permits or licenses. However, Owner Operators must obtain all necessary permits and licenses to operate legally.

8. Confidentiality is Optional: A misconception exists that confidentiality clauses can be ignored. In fact, Owner Operators are required to maintain confidentiality regarding the Carrier’s business information.

9. Subcontracting is Without Consequences: Some believe that hiring subcontractors does not affect their liability. However, the Owner Operator remains fully responsible for any work completed by subcontractors.

Key takeaways

Key Takeaways About the Owner Operator Lease Agreement Form

  • Familiarize yourself with the key sections of the agreement before filling it out to ensure you understand all provisions.
  • The form requires the names and signatures of both the Carrier and the Owner Operator to be legally binding.
  • Ensure that all necessary permits and licenses are secured prior to starting transportation under the lease.
  • Clearly define the transportation obligations, including the minimum amount of freight transportation required during the lease period.
  • Note that the Owner Operator must provide evidence of compliance with applicable local, state, and federal laws throughout the duration of the agreement.
  • Understanding the liability provisions is crucial; the Owner Operator assumes responsibility for loss or damage to goods while in their care.
  • Insurance requirements must be fulfilled, including maintaining proper coverage and notifying the necessary parties about any changes.
  • The agreement prohibits the Owner Operator from assigning the contract without written consent from the Carrier, ensuring control over the partnership.
  • Confidentiality about the terms of the agreement and the Carrier's business information must be maintained to protect proprietary interests.