Getting Around the Graves Amendment

Getting Around the Graves AmendmentFully-loaded U-Haul trucks often weigh 25,000 pounds, or even more. Additionally, these operators often have little or no experience or training when it comes to operating such vehicles. The combination often causes serious crashes.

According to the negligent entrustment rule, vehicle owners, like U-Haul, are leaglly responsible for damages if they allow incompetent motorists to drive their vehicles and these mototists cause car crashes.

An obscure federal law makes these cases very complex. Congressman Sam Graves (D-MO) intended the Graves Amendment to immunize companies like U-Haul from negligent entrustment actions. But the law which bears his name has two key flaws, so an experienced Weatherford personal injury attorney can often hold the vehicle owner legally accountable for car crash damages.

These damages normally include compensation for economic losses, such as medical bills, and noneconomic losses, such as pain and suffering. Additional punitive damages may be available as well.

“Trade or Business” Requirement

In the late 1990s and early 2000s, several juries ordered Enterprise and other large vehicle rental companies to pay large damage awards after serious crashes. So, these companies threatened to pull out of states with generous negligent entrustment laws.

The Graves Amendment protects companies from commercial negligent entrustment suits if they are in the “trade or business” of renting vehicles. Since the brief Graves Amendment does not define this key phrase, attorneys must look elsewhere for clarification.

The Uniform Commercial Code defines a “merchant,” which is a similar term, as someone who:

  • Deals in goods of a particular kind or

  • Has special knowledge about a certain good.

Arguably, neither of these labels apply to most vehicle rental companies. So, Graves Amendment immunity does not apply either.

Many convenience stores have video poker or other machines. But these places are still convenience stores and not casinos. Similarly, many moving and storage companies have several trucks for rent. But these places are still moving companies, as opposed to vehicle rental companies.

Furthermore, the agents at most U-Haul rental establishments know practically nothing about the trucks on the lot, other than how to start them and other basic driving matters.

“Not Otherwise Negligent” Requirement

When lawmakers passed the Graves Amendment in 2002, U-Haul and other dealerships could not verify drivers’ licenses beyond a visual inspection. So, if the renter had a facially valid license, the person could rent a truck.

But technology has evolved. It is now relatively easy to check a person’s driving record. Such checks are arguably the industry standard. Violating this standard is evidence of negligence. In other words, if an owner or agent rents a U-Haul to a driver with a safety-suspended license or a poor driving record, the owner or agent is arguably negligent. Therefore, immunity does not apply.

The Graves Amendment makes commercial negligent entrustment cases more complex, but it does not make them unwinnable. For a free consultation with an experienced personal injury attorney in Weatherford, contact Herreth Law. You have a limited amount of time to act.