QuestionOur adult son-age 22- is covered under our family car insurance and he drives one of our cars. if he is in an accident and is at fault is it possible for the injured party to sue us since a)the car is registered and technically owned by us and 2) he is covered under our family car insurance? I thought if he was responsible and is now an adult he has total responsibility but I've heard that may not be true. thanks so much.
AnswerHi Teri,
I will give a simple answer and then a looooong but legally correct answer. First off, it REALLY does depend upon the state in question since some states have abrogated the common law rule and by statute imposed liability upon the owner of the vehicle.
Not knowing your state, I think the simple answer in your circumstances it to plan that a victim could show that the use of your vehicle was in the fulfillment of some family purpose. Hence, there would be an exception to the general rule that liability does not follow ownership. And the result could be personal exposure beyond the policy limits.
That exception is called the family car doctrine, and by it we assign vicarious liability to the parents if it can be shown that the child living at home—could be a minor or adult—is or was using the car furthering family interests. Does he have to be on an errand at the time of the accident? Probably not. For an adult child, is going to school a family interest? Probably yes.
The family car doctrine is founded on the concept of agency: the agent binds his master whey he is doing something for the master. Think of an employer-employee relationship and you can see that it is logical to hold the employer liable for the negligent acts of the employee committed within the scope of his duties.
This seemingly simple answer has confused some non-attorney experts here on allexperts.com and they have given legally incorrect answers. I will refer you to them in case you do not like my convoluted nuanced answer, but instead want a simple yes or no. You can ask them and they will tell you that the liability ALWAYS follows ownership and hence you will always be liable for your son's negligence.
There MAY be states where that is the law. But they would be in the minority. For example, if you loaned your car to a person you knew to be a good driver for her purposes, and she caused an accident, there should be NO LIABILITY on your personal assets.
Yes, the insurance will be available to defend her and you, but if the victim sues you, your insurance should be able to get the case dismissed for failure to state a claim upon which relief can be granted. That should be the rule in most states, ABSENT ANY STATUTES to the contrary.
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STATUTORY VICARIOUS LIABILITY
The common law rule that (absent an agency relationship) an owner is not liable for the negligence of a competent driver who borrowed her car has been ABROGATED BY STATUTE in some states.
By statute they have established that their requirement of insurance for each vehicle follows the owner. Most states DO require owners to carry insurance on their vehicles. How should they enforce that requirement if an owner elects to forgo insurance and lends his vehicle to another person, who negligently causes and accident?
The choice of some states is apparently to attach liability to the ownership of the vehicle, and there are no exceptions. If you let someone drive your car, then YOU assume the risk of their driving. The theory is spelled out below as well since it can be traced to the common law concept of agency. Your state insurance commissioner can tell you if yours is such a state.
What that means is if you own a vehicle, then no matter how careful you were in allowing another to drive that vehicle, if that person is negligent, then his negligence will follow ownership and you can be held to account for damages above your insurance limits.
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VICARIOUS LIABILITY—car loaned to competent friend
Liability can also be imputed to an owner of a car who lends it to a friend on an agency basis. Again, the allegation would be that the driver of the car is acting as the agent of the owner. If the victim is injured by the driver's negligence and sues the driver, the owner can lose the lawsuit because the negligence of the driver can be imputed to the owner, thereby rendering him negligent.
Do I think this is a sound approach? Not really, since the court is asked to create a fictional agency relationship. But it could be a risk in your case, so I advise you about it.
As a general proposition, a person is NOT liable for the negligent acts of another adult. Period. Now come the exceptions. When someone is acting as the agent of another, then that party, the superior one upon whose directions the agent is acting, can be held responsible for the negligent acts of his agent. Think of employer-employee relationships. When an employee is acting within the scope of his employment, then the employer is going to be held to account for the employee's negligent acts.
If a car owner is going to be held to account for the negligent acts of another who is driving his car, the plaintiff must show some kind of special relationship. The family car doctrine is discussed above. But that is the only one that comes to mind in the circumstances you describe.
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DIVERGENT VIEW OF ANOTHER EXPERT
Maybe I am wrong—so I do want you to be exposed to an opinion that is the opposite of mine, and perhaps you could get a definite answer from the expert who answered a question about an adult son of her significant other driving her car. The question and answer are here:
http://en.allexperts.com/q/Insurance-Law-923/2009/1/Liability-auto-driven-1.htm
The answer starts out this way: "The owner of the car bears the ultimate responsibility of being liable for the actions of anyone that drives the car. Depending on the severity of the accident, the amount could be your total policy limits and ALL of your assets as well as all the assets of the driver."
As you can see from my explanation, this expert's very first sentence is in direct conflict with what I perceive to be the law in most states: the owner is NOT automatically liable.
That is about it, Teri, with the exception of a discussion on how a claim is defended. Even if you are personally liable, your insurance has to hire an attorney to defend you. She will fight for your best interests in trying to get a value within your policy limits. Plus, once those limits are exhausted, most all plaintiffs forgo the suit versus the assets of the liable party since bankruptcy is commonly used to discharge any judgment. In short, it wipes the judgment off the books.
I trust that my extra time here has produced some information that has been of value to you, and thus I would respectfully request that you take the time to locate the FEEDBACK FORM on this site and leave some feedback for me.
Best Wishes,
Dr. Settlement, J.D. (Juris Doctor)
http://www.SettlementCentral.Com
