Understanding Owner Liability in Auto Accidents

If you share a car among the family, it might seem like the easiest thing to let your teenager take your keys to meet their friends at the mall, but here’s the problem: if your teenager gets in an accident, you’re the one liable for damages.

This is due to Section 257.401, Michigan’s “Owner’s Liability” statute.

What Is Michigan’s Owner Liability Statute?

Section 257.401 states that the owner of a motor vehicle is liable for injury caused by the negligent operation of that vehicle, provided the vehicle is being used with their express or implied consent or knowledge.

In other words, you’re not liable if your car is stolen and then gets in an accident, but you are liable if you permit someone to drive your car and they get into an accident.

Determining Liability: When Is It the Owner’s Fault?

An auto accident lawyer can help you determine liability because every situation is unique. However, there are general situations in which the owner may be liable:

Implied Consent/Special Family Relationships

Section 257.401 states that owners can be liable if their vehicle is used with “their implied consent.” One of the most commonly cited methods of proving liability based on implied permissive use is “the family car” or “family purpose doctrine,” a legal theory based on vicarious liability.

Under this doctrine, the parent (the owner of the car) is liable for damages if their child caused an accident while driving because they knowingly allowed their child to get behind the wheel. Keep in mind that liability in this doctrine depends on whose name is on the title and registration, who paid for the car, who regularly drives the car, and the intent of the parents and child with regard to ownership.

For the sake of clarity, it is assumed that the vehicle is being driven with the implied consent of the owner at the time of the accident if it is driven by:

• Their spouse
• Their son or daughter
• Their sister or brother
• Their mother or father
• Another member of their immediate family

Negligent Entrustment

Negligent entrustment involves the owner entrusting their car to someone who is not fit to drive, which could include:

• Someone under the influence of drugs or alcohol
• Someone with a history of reckless driving
• An elderly person with impaired sight or other health conditions that make it unsafe for them to drive
• Someone who is underage and/or unlicensed
• Someone who is inexperienced behind the wheel

In these cases, liability rests on the idea that the owner knew that the person shouldn’t be behind the wheel, yet was given permission anyway, putting others at risk of harm.

Negligent Maintenance

As the name implies, negligent maintenance is the failure to properly maintain a vehicle, putting others at risk of harm whenever the car is on the road.

This legal principle stems from the obligation of owners to protect the safety of their passengers and other drivers. Owners are responsible for replacing brake lights and headlights, repairing faulty tires and brakes, and performing other maintenance tasks as needed. If that owner neglected maintenance and that neglect results in an accident, that owner could be held liable for any damages arising from the accident.

The Real Truth: It’s Complicated

Reading this, it might sound like the owner is always responsible, no matter what. As a general rule, you should assume that if a car is registered in your name, then you are responsible for any damages caused should that car get into an accident. However, a 2018 Michigan Court of Appeals ruling complicates liability by stating that there are certain circumstances in which the owner may not be the only one held liable.

The best way to explain this ruling is through an example:

You own a car and loan it to your friend Bill. Bill allows his son, who doesn’t have a license, to drive your car. Bill’s son gets in an accident.

Who is liable? You, the owner, and Bill, due to negligent entrustment (knowing that his son didn’t have a license and wasn’t allowed to drive, but loaned him the car anyway).

How to Protect Yourself

1. Understand Your Car Insurance: A general rule is that when you purchase car insurance, it should cover everyone in your household, unless they were specifically excluded. Friends and relatives living outside the house may be included under the rule of permissive use, so work with your provider to understand who is covered and who isn’t.
2. Don’t Loan Your Car: It sounds like common sense, but don’t loan your car to someone who isn’t trustworthy. You’re the one who will suffer for it. If you have a child, it’s always better to have a cheap car registered in their name. That way, if they’re involved in an accident, they’re the ones liable for it.
3. Pay Attention to the Title: If you are married, don’t title a car jointly. Title the car in the name of the person who will be driving it most of the time. If your spouse is involved in an accident in a jointly titled car, both of you are liable.
4. Transfer Titles: If you sell or give your car away, ensure the title is transferred and notify your insurance company of the change immediately.
5. Get an Auto Accident Attorney: If it’s too late to be proactive, ensure you have an experienced auto accident attorney by your side.

Seek Help From an Experienced Attorney to Determine Liability

Don’t let someone else’s mistake cost you. If you’re staring down an expensive owner liability case, you need an attorney who will fight for you.

Giroux Pappas Trial Attorneys has been fighting for individuals and families throughout Michigan for over a decade. If you’re not sure what to do, where to go, or who to turn to, we’re here for you. Contact us today to get started with a free consultation.