The 11th Circuit Court of Appeals (the federal appellate court governing appeals in Florida) ruled yesterday that recently enacted federal legislation known as "the Graves Amendment" (49 U.S.C. § 30106) preempts state tort claims against car rental companies under a theory of vicarious liability. In English, what the Court said was that the statute passed by Congress, and signed into law by President Bush in 2005, prevents a plaintiff from suing a car rental company for "negligent entrustment" of the vehicle to a person renting the car. Thus, if the car rental company rents the car to someone that is later found to be at fault in an accident, the car rental company cannot be held liable for renting the car to the person that caused the injuries even if the company knew or should have known that the driver had a bad driving record.
Critics of the Graves Amendment claim that the law provides too much protection to car rental and leasing companies, and such companies should be held accountable for placing a vehicle into the hands of a dangerous driver under the "dangerous instrumentality doctrine." According to these critics, leasing companies in particular do little to ensure that a driver has a safe record before leasing a vehicle to a driver. Others argue that the law should shield car rental and leasing companies against liability because these companies cannot always know if a driver is safe.
Given the rancor over this particular law, it is likely that this or another case will reach the United States Supreme Court. Whether the Court will hear the case is another matter.
