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Plaintiff alleged that on April 29, 2006, she sustained serious personal injuries


This case is about a defendant-corporation seeking the dismissal of the complaint pursuant to CPLR 3211 (a) (7) by reason of the Graves Amendment; and the plaintiff seeking leave of court to amend the complaint pursuant to CPLR 3025 (b) in order to avoid dismissal on that ground.

Plaintiff alleged that on April 29, 2006, she sustained serious personal injuries as a result of a collision between her vehicle and a vehicle owned by defendant-corporation and operated by defendant-driver. She further alleged that defendant-driver was an employee of defendant-corporation, and was operating the vehicle “under the course of his employment,” and “with the express knowledge, consent and/or on the business” of defendant-corporation. The collision was allegedly caused by “the defendants’ negligence, carelessness and recklessness”.

A Federal statue, known as the Graves Amendment “bars vicarious liability actions against professional lessors and renters of vehicles,” as would otherwise be permitted by Vehicle and Traffic Law ยง 388. “Vicarious liability laws caused lessors to either cease leasing cars in states having them, opting for more expensive balloon note structures, or spread the cost of higher insurance premiums to lease customers nationwide.”

To claim immunity from vicarious liability under the Graves Amendment, the owner of the subject vehicle must be “engaged in the trade or business of renting or leasing motor vehicles”; the subject vehicle must have been “rent[ed] or lease[d] . . . to a person”; and “harm to persons or property” must have occurred “during the period of the rental or lease.” If these conditions are met, the statutory immunity attaches unless there is “negligence or criminal wrongdoing on the part of the owner.”

On the other hand, vicarious liability is not abrogated where injury or damage results from the negligence of the owner’s employee in the operation or maintenance of the vehicle, nor it seems where the owner was negligent in entrusting the vehicle to the operator.

Defendant-corporation was able to establish prima facie that it meets the requirement for coverage under the Graves Amendment. However, the Court held that it failed to establish even prima facie that the subject vehicle was “rent[ed] or lease[d] . . . to a person,” and that the collision occurred “during the period of the rental or lease.” The Loss Control Manager asserted only that she is “fully familiar with the personnel and records of” defendant-corporation, and that the Renter [sic] of the vehicle, defendant-driver, was not an employee at the time of the subject car accident.” The assertion that defendant-driver was a “Renter” of the subject vehicle must be based upon some writing or record, but it was neither provided nor described or identified; and the assertion that defendant-driver was not an employee of Defendant-corporation must be based upon a search of records that did not reveal his name, but no description of the records or the search was provided.

The Graves Amendment confers immunity on a rental/leasing owner “if . . . there is no negligence or criminal wrongdoing on the part of the owner.” The word “if” is conditional, and generally one claiming a benefit must show that any condition to the benefit has been satisfied. On the other hand, “[i]t is generally inappropriate to place the burden of proof on a party” – here, the injured plaintiff who is a stranger to the rental/leasing arrangement – “in a case where the facts governing the resolution of the controversy are within the exclusive knowledge of the opposing party.”

With respect to Manhattan and Staten Island Plaintiff’s motion for leave to amend the Verified Complaint to include that Defendant-corporation “negligently entrusted” the subject vehicle to defendant-driver when it “knew or should have known that [he] was incompetent, untrained, and not fit to operate the automobile,” the court held that “In the absence of prejudice or surprise resulting directly from the delay in seeking leave,” an application for leave to amend a pleading pursuant to CPLR 3025 (b) is “to be freely granted unless the proposed amendment is palpably insufficient or patently devoid of merit.”

Entrusting your case to someone knowledgeable of the law is the core stone of of a successful claims against a party. Stephen Bilkis and Associates with its New York Car Accident Lawyers has offices conveniently located within New York Metropolitan area, including Corona, New York.

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