Litigating Motor Vehicle Accident Lawsuits: Combating the Graves Amendment

June 5, 2019 Francis J. Leddy, Jr. Esq.

If you have been involved in a motor vehicle accident involving a commercial vehicle or rental car, you will have to litigate against at least one defendant that asserts a defense based upon The Graves Amendment.

The Graves Amendment (49 U.S.C. §30106) was passed in 2005, virtually eliminating vicarious liability claims against rental car companies. The Graves Amendment is part of a federal highway bill which basically bars vicarious liability claims against car rental companies for injuries caused by their customers, unless it can be proven that the company's negligence or actions contributed to those injuries. Federal law states the following:

An owner of a motor vehicle that rents or leases the vehicle to a person (or an affiliate of the owner) shall not be liable under the law of any State or political subdivision thereof, by reason of being the owner of the vehicle (or an affiliate of the owner), for harm to persons or property that results or arises out of the use, operation, or possession of the vehicle during the period of the rental or lease, if:

1. The owner (or an affiliate of the owner) is engaged in the trade or business of renting or leasing motor vehicles; and

2. There is no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner).

To benefit from the Graves Amendment, the “owner” must be “engaged in the business of renting or leasing motor vehicles.” A vehicle “owner” may be the titleholder, lessee, or bailee of the vehicle.

Since most rental cars cross state lines (or operate in multiple states), and are thus engaged in interstate commerce, The Graves Amendment preempts state liability laws. It also has been used in state courts to protect companies that rent trucks, tractors, trailers, and other such commercial vehicles from vicarious liability. It also has been determined to apply to car-sharing companies such as Zipcar.

If you have been involved in a motor vehicle accident involving a commercial vehicle or rental you must be mindful that you have potential claims against not only the driver of the other vehicle, but the owner and the company or person that rented the vehicle. Also, The Graves Amendment does not protect a rental company from its own negligence or criminal wrongdoing. If your injury was caused by a rental company’s negligent or criminal act, the rental company could still be directly liable for its actions or inactions — even if an accident occurs while a renter is driving the vehicle.