2/03/2005

Vicarious Liability, Revisited

Via Overlawyered...

I've talked about vicarious liability laws before. These are the laws that make car rental companies responsible for whatever drivers do in their vehicles. Budget Rent-A-Car is the latest victim of this nonsense:

A Manhattan pedestrian, paralyzed in an accident caused by a driver of a rental car, has been awarded a $20 million judgment against Budget Rent-A-Car, the victim's lawyers said yesterday.

Manhattan Supreme Court Justice Milton Tingling awarded 29-year-old Ethan Ruby $20.3 million after he was crippled while walking crossing Delancey Street at Orchard Street on Nov. 29, 2000.

The driver of the Budget rental car had run a light and hit a van that then careened into Ruby, leaving him crippled and in constant pain.
One of the effects of these laws has been to squeeze out smaller rental companies. According to the New York Sun, there were about 400 such companies three years ago; that number has dwindled to less than 50. Some say that the larger companies don't fight these laws too aggressively in the past because it's been an effective deterrent to competition.

Trial lawyers love it because it's a fast route to companies with deep pockets; all you need to do is prove ownership, document the rental, and prove damages. In a state where the Assembly is led by trial lawyer Sheldon Silver, the situation is not likely to improve.