Bills Would Protect Rental Industry From Liability for Customer Accidents

The truck renting and leasing industry is thrilled about proposed legislation that would prevent lessors from being held liable for accidents caused by their customers.

Though federal legislation introduced May 26 would release leasing companies from liability for accidents that are not their fault, it would still hold a company accountable if it was proven to be negligent in renting or leasing a vehicle.

"These reforms are long overdue," said Senate Commerce Committee Chairman John McCain (R-Ariz.), who introduced the Senate bill. "The enormous costs of these suits is passed directly on to consumers, who should not have to pay for these claims when these companies are clearly not at fault."

Rep. Ed Bryant (R-Tenn.) introduced the House version of the legislation.

Michael Payne, president of the Truck Renting and Leasing Association, said he was thrilled by the congressional proposal.

"There is probably no federal issue that has more impact on my members than this legislation," Payne said.

TRALA has fought for a decade for liability caps. The group came close in 1996 to achieving its goal when such a proposal was included in legislation passed by Congress reforming the legal system. However, President Clinton vetoed the measure.

Last year, tort reform was backed by the White House and congressional negotiators, but the effort died without a vote in the full Senate.

Lawsuits under state "vicarious" liability laws cost the truck and automobile leasing industry more than $100 million annually, said Steve Nousen, vice president of government affairs at TRALA. Under the theory of vicarious liability, if the operator of a rented truck or car is involved in an accident and causes damage, the owner of the leased vehicle is liable.

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