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Boca Raton Personal Injury Lawyer > Blog > Auto Accidents > Is An Auto Dealership Liable For An Accident Cause By A “Loaner” Vehicle?

Is An Auto Dealership Liable For An Accident Cause By A “Loaner” Vehicle?


Vicarious liability is an important legal concept when it comes to auto accidents. It basically means that the owner of a vehicle can still be held financially responsible for an accident victim’s injuries even if they were not the person actually driving the car at the time. For example, if someone causes an accident while driving their employer’s vehicle on a work-related matter, the employer is vicariously liable for the damages.

One exception to the vicarious liability rule involves rented or leased vehicles. There is a federal statute, commonly known as the Graves Amendment, which states that a person “engaged in the trade or business of renting or leasing motor vehicles” is not vicariously liable if someone they rented or leased the vehicle to causes an accident. In other words, if you are side-swiped by a car that someone rented at the airport, you cannot sue the rental company in most cases.

The Florida Fifth District Court of Appeals recently examined something of a legal gray area with respect to the Graves Amendment. In this case, Romero v. Fields Motorcars of Florida, Inc., the plaintiff was injured in an accident with a car owned by the defendant. The defendant, an auto dealership, had loaned the car to one of its customers while it worked on his truck.

The plaintiff sued the defendant, alleging it was vicariously liable. The defendant argued it was immune under the Graves Amendment, as the loaner vehicle was part of the servicing that its customer had paid for. The trial court agreed and dismissed the lawsuit. The Fifth District, reversed, however, concluding the Graves Amendment did not apply to this situation.

More precisely, the appellate court said that,

a transaction involving the provision of a complimentary loaner vehicle is not a rental or lease transaction where no money or other consideration is identified by the parties at the time of the transaction; where the purported lessee was not made aware he was entering into a lease; and where there is no indicia of a lease agreement, oral or written.

Basically, the mere fact that the price of the rental was “baked into” the servicing arrangement was not enough to qualify the use of the vehicle as a rental or lease as contemplated by the Graves Amendment. The customer did not separately pay any fee to rent the loaner vehicle. Nor was there any “meeting of the minds” to form a rental contract. As such, the plaintiff was entitled to proceed with her lawsuit against the dealership.

Speak with a Florida Car Accident Attorney Today

There are often multiple parties who may share in some of the legal responsibility for an accident. A qualified Boca Raton auto accident lawyer can help you investigate the circumstances of your crash and determine who may be at-fault. Contact Leifer & Ramirez today to schedule a free consultation with a member of our personal injury team.


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