Car Owner Liability

Being involved in a car accident can severely affect the life of the victim. Accordingly, the payment of damages is designed to help ease the life of the victim by compensating them for pecuniary loss and pain and suffering. Unfortunately for the victim, at times it may be difficult to recover damages from a driver, such as when the defendant driver does not have enough assets or insurance coverage to pay the amount ordered by the court.

On the other hand, if the driver and owner of the vehicle are two different persons, then a victim may be able to collect not only from the driver but also from the owner. This provision, however, is limited to certain instances and financial caps on recovery.

In this article, we will be discussing the liability of car owners in vehicular accidents. For more questions, or for in-depth advice regarding your case, please feel free to contact a Sacramento car accident lawyer for a free consultation.  

The following persons are considered owners of a vehicle for purposes of liability:

• The registered owner of the vehicle
• A co-owner when the vehicle was driven by another co-owner
• The true owner or co-owner of the vehicle, regardless of whether the vehicle was registered in his/her name
• Members of an unincorporated association, one of whom was the registered owner
• The personal representative of the deceased during estate administration.

In order for an owner to be held liable for damages sustained from a driver’s actions, he or she must have granted permission to the driver for the use of the vehicle. This fact must be established before the victim can hold the car owner liable. Mere possession of the vehicle does not translate to permission.

Permission can be expressed or implied. Implied permission may be inferred when the driver and the owner have an employment or family relationship. However, it is not necessary that the driver be an employee or a family member before the car owner can be held liable. 

When the owner gives permission for the use of the vehicle, it comes with the implied authority to entrust the vehicle to a third person. The third person is referred to as a ‘subpermittee’ under the law. In this scenario, there are three people involved – the owner, the permitted driver, and the subpermittee entrusted by the permitted driver. The owner can be held liable not only for the actions of the permitted driver but also for the actions of the subpermittee. 

An owner is similarly liable when he or she entrusts the vehicle to a person who is incompetent, unfit, or reckless. A driver’s incompetence or unfitness may be established by any of the following: 

• Inexperience
• Lack of license
• Previous record of recklessness
• Physical infirmities
• Age 
• Intoxication

The California Vehicle Code prescribes maximum amounts for which an owner can be liable. They are as follows:

• $15,000 per person
• $30,000 per accident for injury
• $5000 per accident for property damages and there is no imputed liability for punitive damages

A car owner’s liability is considered vicarious. This means that the owner can only be made to pay the extent of the amount which the driver is unable to pay. For example, if the court orders $5,000 in damages and the driver’s assets can only cover $3,000, then the victims can go after the owner for the remaining $2,000. The owner cannot be made to pay the entire $5,000 when the driver can still pay a portion of the amount.

If the owner of the vehicle has already paid the victims an amount for settlement, this will not preclude the victims from recovering damages from the driver. The amount that the driver can be made to pay however will be reduced in this case.

If it is the driver who has already made a payment for settlement, then the victims can no longer go after the owner, as the driver’s settlement discharges the liability of the owner.