The Auto Owner’s Liability for “Permissive Uses”

VEHICLE OWNER LIABILITY FOR PERMISSIVE USE OF A VEHICLE

Under California law, motor vehicle owners are liable for the negligent acts (and accidents) of any person who operates the vehicle with the owner’s consent. The California vehicle code also creates similar liability for bailees, meaning people who rent out (or lease) automobiles that belong to another person.

The vehicle owner can be held liable, by statute, for amounts up to:

(a) $5,000 in property damage; and

(b)  $15,000 in damages for injuries or death caused to any one person, or $30,000 in damages for injuries or death to multiple people.

These damages are set by statute (See California Vehicle Code § 17151(a)) and apply on a “per accident” basis. However, these limits do not apply where the vehicle owner is also liable under other theories (for example, negligent entrustment); in those cases, the owner’s potential liability may be even higher, and may include punitive damages–which are not available under this statutory cause of action.

The statutes creating this liability apply to both express consent and implied consent–meaning that vehicle owners can’t escape liability by allowing the use “without saying the words.”

These statutes exist to give a remedy to people who suffer injuries but cannot recover damages from the actual driver whose negligence resulted in the accident. The California legislature has determined that as between an innocent victim/injured party and a person who made the choice to lend his or her vehicle to a person who subsequently acted negligently, the innocent victim’s ability to recover should prevail.

STATUTORY LIABILITY ATTACHES ONLY TO VEHICLE OWNERS (OR BAILEES)

The California vehicle code sections which govern permissive use (and liability therefor) apply to “owners” and “bailees” of vehicles only. For purposes of permissive use liability, the “owner” of a vehicle is the person–or persons–named as the owner(s) on the vehicle’s registration record. A person who sells or transfers actual ownership of a vehicle should comply with the DMV’s requirements and procedures (and complete all required filings) promptly, in order to avoid potential statutory liability for accidents involving the vehicle after the transfer of ownership takes place.

A NOTE: THE LIMITS ON VEHICLE OWNERS’ DAMAGES DO NOT APPLY TO THE DRIVER

The statutory limits on damages owed by the vehicle owner do not apply to the negligent (or willful, or reckless) driver. The driver’s liability is limited only by the causes of action which may apply to (or be brought against) the driver following the accident or injury.

DISCLAIMER: This article is intended for informational purposes only, does not constitute legal advice to any person or entity, and does not create an attorney-client relationship with any person or entity. Negligence law and defenses are a complex legal topic, as is vehicular liability, and no single article can provide complete or comprehensive coverage or information about this or any other legal topic or issue. Your personal liability may differ, based on your individual facts and circumstances. If you believe you have a legal claim or issue, or wish to know more about your individual rights, consult an experienced attorney without delay.