Wade Clark Mulcahy LLP

<p style="text-align: justify;">In <em><a href="https://www.wcmlaw.com/wp-content/uploads/2020/02/Couchman-v.-Nunez.pdf">Couchman v. Nunez</a>,</em> Plaintiff was operating a motorcycle when involved in an accident with a delivery vehicle owned by defendant MTLR and leased to co-defendant BAM Produce Inc. Plaintiff alleged MTLR was negligent in failing to maintain and repair its vehicle. The trial court granted summary judgment to MTLR on the grounds that defendant could not be liable under the Graves Amendment (49 USC §30106), which preempts New York Law that all owners of vehicles are vicariously liable for the negligent acts of their permissive driver.</p>
<p style="text-align: justify;">Specifically, the Graves Amendment provides that the owner of a leased or rented vehicle cannot be held liable for personal injuries resulting from the use of such vehicle by reason of being the owner of the vehicle for harm to persons or property that results out of the operation of the vehicle during the period of the rental or lease if: (1) the owner is engaged in the trade or business of renting or leasing vehicles, and (2) there is no negligence or criminal wrongdoing on the part of the owner. On Appeal, the Second Department ruled that summary judgment was improper because MTLR failed its prima facie burden. The court held that "where 'a plaintiff seeks to hold a vehicle owner liable for the alleged failure to maintain a rented vehicle' the owner is not afforded protection under the Graves Amendment if it fails to demonstrate that it did not negligently maintain its vehicle." Although the Court conceded that MTLR owned/leased the vehicle and was in the business of leasing vehicles, it concluded that MTLR's failure to produce evidence demonstrating the condition of the vehicle at the time of delivery to BAM Produce,  or at any time up to the point of the accident, it found that MTLR was not entitled to summary judgment.</p>
<p style="text-align: justify;">The lesson learned for  vehicle leasing companies is to create and maintain proper proof of regularly scheduled maintenance and vehicle condition. This will ensure that when sued, their lawyers can seek an early resolution under the protection of the Federal Law.  As evidenced in this decision, a leasing company cannot take cover behind the Graves Amendment simply because it is engaged in the trade or business of renting vehicles. A regularly scheduled, detailed maintenance record under these circumstances could cut off liability of any potential claims by an injured plaintiff.</p>
Thanks to Raymond Gonzalez for his contribution to this post.  For any questions or comments, please contact <a href="mailto:vterrasi@wcmlaw.com">Vincent Terrasi</a>.