Highway Bill Rids Industry of Vicarious Liability

MONTGOMERY, Ill. --- President George W. Bush on Aug. 10 signed the federal highway bill, which included an amendment eliminating vicarious liability for the vehicle renting and leasing industries. The law took effect immediately.

After years of tort reform lobbying efforts, car rental companies can finally celebrate the end of vicarious liability --– a policy that has cost the industry more than $100 million each year in civil suit settlements and jury awards. Vehicle renting and leasing companies can no longer be held liable for the accidents of their customers or lessees.

The amendment ending vicarious liability was introduced by Congressman Sam Graves (R-Mo.). Graves' amendment supersedes all state vicarious liability laws.

A coalition of vehicle renting and leasing companies, formed by the Truck Renting and Leasing Association (TRALA) in 2003, spearheaded the federal reform effort. The group, known as the Vehicle Renting and Leasing Fairness Alliance, included representatives from Cendant Car Rental Group, Enterprise Rent-A-Car, Hertz Corp., Vanguard Car Rental and Dollar Thrifty Automotive Group.

"This has been a long-fought battle," said TRALA President and CEO Peter J. Vroom. "We have been successful in reforming vicarious liability laws at the state level for many years. But with the interstate nature of our national rental and lease fleets, federal action was essential to create uniformity that no state can impose vicarious liability. This is simply common-sense tort reform."

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