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Who’s Legally Responsible For Moving Truck Crashes?

This question is on the minds of many people in the Clark County area. Since 2017, an average of 4.9 people per hour have moved to the Las Vegas area. A number of these individuals rent their own moving trucks from U-Haul, Ryder, and other such companies. These vehicles are large and unwieldy. Furthermore, their drivers are usually unfamiliar with both the vehicles and the Las Vegas area streets.

That combination greatly increases the risk for a serious collision. According to the negligent entrustment rule, vehicle owners are usually responsible for damages if they allow incompetent drivers to use their vehicles. But because of the Graves Amendment, this doctrine does not always apply to commercial negligent entrustment cases. So, in many of these situations, an attorney’s first job is getting around the Graves Amendment.

This brief law has two key provisions. Each one has some holes.

“Trade or Business” Requirement

49 U.S.C. 30106 applies to an “owner or affiliate” of vehicle rental companies. Missouri Democrat Sam Graves said he introduced this provision to immunize small businesses against large liability judgements. A short time earlier, a large vehicle rental conglomerate threatened to cease operations in several states over this issue.

So, in order for the Graves Amendment to apply, the defendant must be “engaged in the trade or business of renting or leasing motor vehicles.” The problem here is that this bill does not define key phrases. Therefore, Nevada judges must use the best available definition.

The IRS defines this phrase as “any activity carried on for the production of income from selling goods or performing services.” This broad definition is not very useful in this context. Congress clearly intended a more limiting definition.

For that, we turn to the Uniform Commercial Code. The UCC plays a prominent role in many Las Vegas commercial cases. There is no definition for “trade or business.” But the UCC does define “merchant,” which is a similar term. Section 2-104 states that a merchant deals in goods of a particular kind. For example, a hardware store is in the hardware business, even if it also sells snacks and other non-hardware items.

According to that definition, most U-Haul and other establishments do not qualify under the Graves Amendment. Many of these establishments are not vehicle rental companies. Instead, they are moving supply and storage facility companies which happen to have a few trucks in the parking lot.

“Not Otherwise Negligent” Requirement

Furthermore, for immunity to apply, there must be “no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner).” Not many vehicle rental transactions involve criminal conduct, but negligence is another matter.

In this context, negligence often means a failure to follow industry standards. When lawmakers passed the Graves Amendment in 2005, no one verified drivers’ licenses aside from a visual inspection. Now, that’s no longer the case. Many companies require owners and affiliates to run drivers’ license checks before they complete these transactions.

Some states, not including Nevada, have even developed some rules in this area. Under these rules, most companies are negligent as a matter of law if they rent vehicles to people with suspended or invalid licenses. If the lessee has a bad driving record, there is basically a presumption of negligence. In either case, the Graves Amendment is arguably inapplicable.

Once the Graves Amendment is out of the way, the victim/plaintiff can establish third party liability based on the aforementioned negligent entrustment rule. That’s good news in these cases, since the individual tortfeasor (negligent driver) often lacks sufficient insurance coverage to provide full compensation.

Work With an Experienced Lawyer

Despite the Graves Amendment, vehicle rental companies may still be responsible for rented vehicle crashes. For a free consultation with an experienced personal injury attorney in Las Vegas, contact Naqvi Injury Law. We do not charge upfront legal fees in negligence cases.