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How MN Personal Injury Lawyers Get Around the Graves Amendment

by | Sep 3, 2018 | Car Accidents, Firm News, Lawyers

Negligent entrustment is one of the most common vicarious liability theories in Minnesota. According to this rule, vehicle owners may be responsible for damages if they allow incompetent drivers to use their vehicles.

Third party liability theories like negligent entrustment are especially important in wrongful death and catastrophic injury cases. The damages in cases like these can easily be in the hundreds of thousands of dollars. Minnesota has one of the lowest auto insurance minimum requirements in the country. So, many times, the tortfeasor (negligent driver) does not have enough coverage to provide full compensation.

Commercial negligent entrustment cases are quite common. Rented cars and trucks dot Minnesota highways. To obtain fair compensation in these cases, MN personal injury lawyers must work a little harder, because of the Graves Amendment. This law purports to exempt vehicle rental companies from the negligent entrustment rule.

“Trade or Business”

Lawmakers added 49 U.S.C. 30106 to a large omnibus transportation bill in 2002. Like many other obscure policy riders, many legislators probably did not know exactly what they were voting on. There is no legislative history backing up the Graves Amendment. Furthermore, lawmakers only debated it for a few minutes on the floor.

Nevertheless, insurance companies often try to use the Graves Amendment to limit compensation in U-Haul, Ryder, Enterprise, Avis, and other vehicle rental cases. However, the law’s vagueness and ambiguity plays into the hands of MN personal injury lawyers.

Under subsection (a)(1), vehicle owners are not liable for car crash damages if they are in the “trade or business” of renting vehicles. Rep Sam Graves (D-MO) had small businesses in mind when he authored this provision. He wanted these businesses to be immune from liability if they rented vehicles to incompetent drivers who caused car crashes.

But the brief Graves Amendment does not define this key phrase. So, MN personal injury lawyers must look elsewhere. The Uniform Commercial Code defines “merchant,” a similar term, as someone who has a special knowledge about a good or service.

Most companies that rent vehicles have no special knowledge about them. They may not be able to even give customers basic information, like the engine’s horsepower or the total weight-bearing capability.

If the vehicle owner is not in the “trade or business” of renting cars, the Graves Amendment does not apply.

“Not Otherwise Negligent”

For immunity to apply, the owner or agent must also not be negligent in the rental transaction.

Back in 2002, there was no technology to verify drivers’ licenses outside the DMV. So, a visual inspection was always sufficient. But technology has advanced quite a bit. Now, it is arguably the industry standard to electronically verify drivers’ licenses prior to completing vehicle rental transactions.

Violation of the industry standard is nearly always clear evidence of negligence, or a lack of ordinary care.

Sometimes, MN personal injury lawyers use the following approach to determine negligence. If the customer’s license was invalid or suspended, there is a strong presumption of negligence. If the customer’s driving record showed an accident or two, there probably is no negligence. If the customer had prior safety suspensions, MN personal injury lawyers may introduce additional evidence to show negligence.

In almost all civil cases, the victim/plaintiff must prove negligence by a preponderance of the evidence (more likely than not). Such evidence usually entitled the victim/plaintiff to damages. These damages normally include compensation for both economic losses, such as medical bills, and noneconomic losses, such as pain and suffering. Additional punitive damages may be available as well, in some cases.

Call Today To Speak To A MN Personal Injury Lawyer From Carlson & Jones

It is difficult, but not impossible, to obtain fair compensation in commercial negligent entrustment cases. For a free consultation with an experienced MN personal injury lawyer, contact Carlson & Jones, P.A. Home and hospital visits are available.