Q: “My roommate borrowed my car while I was asleep. I didn’t give her permission to use it that night, but I have let her use it frequently in the past. She was involved in a collision where she and the other driver both suffered property damage and personal injury. There is a dispute as to who is responsible for the accident. The other driver has been calling me seeking my insurance information. What are my rights under these circumstances?”
A: The questions presented by the readers of this column are like twisted law school exams. You indicate that although your roommate did not have your specific permission, she had always received such permission in the past whenever she asked. Since you have freely granted permission previously, it can be argued that on the night of the incident, she had your implied permission.
In the case of Richards v. Stanley (1954), the California Supreme Court established the underlying rule relating to injuries caused by stolen vehicles. The case involved an action by a plaintiff who was struck by a stolen automobile operated by a thief, who obtained access to the vehicle when the owner left it unattended with the keys in the ignition.
The Richards decision announced a rule of nonliability under such circumstances, noting that in the absence of a statute imposing such liability, “It has generally been held that the owner of an automobile is under no duty to persons who may be injured by its use to keep it out of the hands of a third person in the absence of facts putting the owner on notice that the third person is incompetent to handle it.”
Therefore, if your vehicle was indeed stolen, report it to the police and watch your relationship with your roommate deteriorate rapidly. Seriously, only make such a claim when it is absolutely true, as filing a false police report is a crime.
If you allowed permissive use of the vehicle, California Vehicle Code Section 17151 applies. Section 17151 states that in a case where you have provided permissive use to your roommate, your vicarious liability (liability that derives from another’s conduct, such as with an employer and employee) is limited to $15,000 per person and $30,000 per occurrence. This is the limit associated with the minimum insurance requirements for private automobiles.
If, however, you know that your roommate is a chronic drunkard who often takes you car and operates while intoxicated, there may be a claim made against you in excess of the $15,000 and 30,000 amounts provided under the Vehicle Code: not for your vicarious liability, but instead based on your own fault by negligently entrusting your vehicle to someone known to be a dangerous driver. This is referred to as negligent entrustment.
In such a case, were you to be held liable for negligent entrustment, your insurance would normally provide coverage up to the limits of your policy. You could be held responsible for any damages in excess of your insurance coverage. So, word of caution to you readers: Do not lend your car to anyone who has a history of bad driving behavior, DUIs and/or reckless driving. If someone is using your car regularly, it is best to list them as an additional insured person on your policy.
Some policies provide for insurance coverage to permissive users that is above and beyond the $15,000 and 30,000 limits described under the Vehicle Code. For example, my coverage would provide the full extent of my coverage limits to a friend borrowing my car with my permission. Some insurance policies do not provide any coverage, or provide reduced coverage, to permissive users who are not the policyholder.
Given that your car was involved in a collision, you need to immediately file a report with your insurance company. Given the fact that you have a duty to report and cooperate, your failure to notify your insurance company could foreseeably result in having your request for coverage declined.
If someone seeks to hold you liable, your insurance company owes you a duty to provide a defense to any such claims regardless of whether or not you are ultimately found responsible.
So, Claire, I strongly suggest that you meet with your insurance agent and review your policy to see what coverage is available to you and your roommate.
Christopher B. Dolan is owner of the Dolan Law Firm. Email questions to firstname.lastname@example.org.