June 30, 2009
/24-7PressRelease/ -- Federal Law Protects Auto Lessors
Article provided by Bosco, Bisignano and Mascolo, Esqs., LLP, please visit us at
http://www.siaccident.com
New York has a much lower rate of car ownership than other states. In New York City, only 46 percent of the people own cars, according to the 2000 Census. In Manhattan that drops to 22 percent. When New Yorkers need to travel outside the city they often choose to rent a car.
Until 2005, New York law allowed those injured in an auto accident caused by someone driving a leased vehicle to hold the leasing company liable for their injuries. As part of the reauthorization of the Highway Bill, however, in 2005 Congress passed the Graves Amendment. Among other things, the Graves Amendment preempted this state law, cutting off a potential source of recovery for injured New Yorkers.
New York Law
Prior to passage of the Graves amendment, New York law allowed for vicarious liability: The company that leased or rented a car could be held liable for death or injuries resulting from the negligence in the operation of the vehicle by any person who had permission to drive the vehicle.
Why allow vicarious liability? First, the owner of the vehicle may be in the best position to determine whether that employee, lessee or renter should be driving that car -- in other words, whether he or she is a safe driver. New York was not alone in allowing the leasing or rental companies to be held liable; 15 states and the District of Columbia had similar legal provisions.
More importantly, however, vicarious liability makes it more that someone who is injured or even killed in an automobile crash has a greater chance of recovering for their loss. Under New York law drivers must carry insurance that provides $25,000 per injury, with a maximum of $50,000 for injuries in one accident. For death the coverage is $50,000 per person with a maximum of $100,000 per accident. The minimum for property damage is $10,000. In an accident where injuries would prevent a person from working, $25,000 would not go very far in replacing lost wages.
Graves Amendment
Rep. Sam Graves (R-Missouri) offered his amendment on the floor of the House of Representatives on March 9, 2005. The bill that was being discussed and voted on was the reauthorization of the Highway Bill, known as the Safe, Accountable, Flexible and Efficient Transportation Act (SAFETEA-LU). This amendment provided that the owner of a motor vehicle shall not be liable under the law of any state for harm to person or property that results from the use of the vehicle. The amendment passed by a vote of 218 - 201, and President George Bush signed this bill into law on August 10, 2005.
Impact of Graves Amendment on New York Law
For lawsuits filed after August 10, 2005, New York law that allowed for vicarious liability -- the ability to hold the owner of the car responsible for injuries caused by the negligence of a driver the owner allowed to drive the car -- is preempted by federal law.
The Graves amendment has faced legal challenges in the jurisdictions that allowed for vicarious liability. New York lawmakers -- and those of other states similarly affected -- believe that decisions so directly related to the state's tort recovery system should be made by them and not imposed on them by the federal government. So far, the courts have been unwilling to find the amendment unconstitutional; many of the decisions have relied on the authority given to Congress by the Constitution to regulate interstate commerce.
If you are involved in a car accident, there are still many avenues to explore to determine who should be held responsible. The sooner you contact a lawyer to advise you, the better especially in a situation where evidence may be destroyed.
Source: Bosco, Bisignano and Mascolo, Esqs., LLP
Website:
http://www.siaccident.com---
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