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NOVEMBER 2012 issue of
Rental Management

Risky Business: No documentation, no proof
11/01/2012

A concrete buggy is a type of ride-on equipment with a triangular-shaped bin mounted on the front of the machine. It is generally used to move and deliver a small load of ready-mix concrete. It also can be used for carrying small loads of varying materials and dumping them at a desired location. A concrete buggy is like a motorized wheelbarrow that you drive.

Concrete buggies reduce the risk of injury while performing a job because there is often no heavy lifting involved — the machine does the work for you. Most people don’t get hurt using a concrete buggy.

The employee of one renter, however, was severely injured while using a concrete buggy. It is not known exactly what he was doing at the time of the accident. He said, “All of a sudden fuel was leaking, the machine backfired and a fire started.” The man received burns to both of his hands and his face.

The company that rented the concrete buggy was a regular customer of the rental store and had rented this particular machine several times in the past. They had never had any issues with the concrete buggy not functioning correctly.

The rental store was called to come get the burned up machine. When they got it back to the shop and were unloading it from the trailer, a shutoff valve was found lying next to the buggy. It is unknown whether a fireman knocked it off or if it was the reason for the fire.

Once a claim was filed with the rental store’s insurance company, the claim adjuster hired an expert to determine how the fire started. The expert was able to conclude that a grommet failed, allowing gas within the tank to drain onto the engine below. Gas vapors likely ignited from contact with exhaust from the machine.

The rental store owner was adamant that his employees regularly inspected and maintained all of the equipment in the store’s rental inventory. He stated they examined the machines prior to and after each rental, and performed general maintenance when it was warranted. They took good care of their equipment. However, nothing was documented. No records were kept.

The expert determined the grommet that failed was not something that would likely have been found during the course of regular maintenance. In fact, the expert further stated that no maintenance deficiencies were found. However, since there weren’t any records proving the rental store performed regular upkeep and repair, it was as if the maintenance had never taken place. They simply could not prove their actions.

The adjuster decided to go another route in his investigation and asked the rental store owner for the names of previous renters. His intent was to contact the customers to see if they had ever had any issues with the concrete buggy in question. The rental store owner informed the insurance adjuster that they did not keep rental contracts beyond the end of the rental. When the equipment was returned, the contracts were thrown out. He had no idea who had rented that specific concrete buggy in the past.

The manufacturer of the concrete buggy was contacted and its representative inspected the machine. His theory was that someone had been taking off the valve to remove gas from the fuel line and the repetitive procedure eventually caused the valve to loosen. The rental store personnel claimed they never touched the valve. Since there weren’t any records detailing any type of maintenance, nothing could be proven.

The final resolution of the claim was a five-figure payment to the injured man for his time off work, medical bills, and pain and suffering. The concrete buggy was replaced by the rental store’s insurance company.

Because the rental store did not keep any paperwork related to maintenance or repairs, it was not able to prove its equipment was well cared for and maintained. If it had records, the rental store could have demonstrated that all problems or malfunctions were repaired and that all regular maintenance was performed. The manufacturer would likely have been solely responsible for the accident due to the parts that failed. As it was, the manufacturer of the concrete buggy and the rental store’s insurance company split the payment to the injured man.

Don’t put yourself in the same situation as this rental store. Maintenance records and rental contracts should be kept for at least five years from the date of repairs or rental. If a problem ever arises, you want to be able to prove you maintain and repair your equipment according to the manufacturer’s guidelines.

Mary Ann Gormly, CERP, is risk management coordinator for ARA Insurance, Kansas City, Mo. For more information, call 800-821-6580
or visit ARAinsure.com.

 

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