No negligence per se for rental car company for unknowingly renting to a driver with a suspended license

In Young v. U-Haul Company of D.C., No. 09-CV-1526 (D.C. Jan. 6, 2011), the Court declined to adopt an interpretation of D.C. law that would impose strict liability on rental companies if they fail to do more than require presentment of a facially valid driver's license from rental customers.

In this case, the plaintiff was a pedestrial who was struck and injured by a U-Haul truck.  The driver of the truck had rented it by showing his facially valid, unexpired Virginia driver's license.  However, as it turned out, his license had been suspended by Virginia.

The Plaintiff brought an action against U-Haul and the driver for negligence, and for negligent entrustment against U-Haul alone.  After the negligence claim against U-Haul was dismissed, the Plaintiff sought to amend her complaint to claim negligence per se against U-Haul.  The trial court granted summary judgment to U-Haul on all claims, and the Plaintiff appealed.

The Court of Appeals, in affirming the trial court, reasoned that the Plaintiff had failed to demonstrate that the renter's appearance or conduct should have alterted U-Haul of any risk of harm to others.  The Court cited Maryland and Connecticut authorities to the effect that there can be no negligent entrustment where there is no evidence that would have put a prudent person on inquiry.

The Court also declined to interpret 18 DCMR sec. 1100.12 as imposing strict liability on U-Haul for "authorizing" an unlicensed driver to use the vehicle.  The regulation states, in pertinent part, that "No person shall authorize or knowingly permit a motor vehicle owned by him or her or under his or her control to be driven by any person who is not authorized . . . or who is not licensed . . . . "  The Court held that proof of culpable mental state of knowingly is applicable to both "authorize" and "permit" under 18 DCMR sec. 1100.12.

Although the Court does not say so in its opinion, it is likely that U-Haul obtained dismissal of the negligence claim under the Graves Amendment.


Graves Amendment reviewed

The Graves Amendment is a federal statute that essentially abolished vicarious liability of rental car companies for the negligent driving of renters.  The Graves Amendment stated, in pertinent part, as follows:

"a) In general. An owner of a motor vehicle that rents or leases the vehicle to a person (or an affiliate of the owner) shall not be liable under the law of any State or political subdivision thereof, by reason of being the owner of the vehicle (or an affiliate of the owner), for harm to persons or property that results or arises out of the use, operation, orpossession of the vehicle during the period of the rental or lease, if-- (1) the owner (or an affiliate of the owner) is engaged in the trade or business of renting or leasing motor vehicles; and(2) there is no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner)." 49 USCS § 30106.

Like it or not, this federal statute overturned well-settled law in D.C.

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