Truck Renter's Failure to Produce Copies of Its Internal Policies and Procedures for Investigating Renter's Driving and Criminal History Found an Insufficient Basis to Deny Renter's Motion for Summary Judgment Based on Graves Amendment

AUTO – GRAVES AMENDMENT – RENTED TRUCK – RESTRICTED DRIVER'S LICENSE – FAILURE TO PRODUCE RENTAL POLICIES AND PROCEDURES – NEGLIGENT ENTRUSTMENT THEORY
Byrne v. Collins
(2nd Dept., decided 10/19/2010)

A Budget franchisee rented a Budget truck to JBG Trucking.  The rental agreement provided that any authorized employee of JBG with a valid driver's license was permitted to operate the vehicle upon presentation of a valid driver's license by the company employee who picks up the vehicle.  Jamie Collins presented a restricted driver's license to the Budget location and, while driving the rented truck, struck and killed the plaintiff's decedent, who was riding a bicycle.  Plaintiff alleged that the Graves Amendment did not apply because the Budget defendants knew or should have known from Collins' presentation of a restricted driver's license that he had a history of drug and/or alcohol related offenses.  In opposition to the Budget defendants' motion to dismiss plaintiff's complaint and for summary judgment, plaintiff argued that the Budget defendants negligently entrusted the rented truck to Collins, and that their negligence precluded application of the Graves Amendment's vicarious liability exemption.

While agreeing that the presentation of a restricted license "does not, in and of itself, compel a motor vehicle rental agent of average ken to scrutinize the renter", Kings County Supreme Court Justice Francois Rivera denied the Budget defendants' motion for summary judgment because they had not submitted their written rental policies and procedures and established that the Budget franchisee followed those policies and procedures in renting the truck to JBG.

The Budget defendants appealed that decision to the Appellate Division, Second Department, and that court REVERSED the lower court's decision, finding that there was no triable issue of fact as to whether or not the Budget defendants possessed any special knowledge concerning a characteristic or condition peculiar to Collins that rendered his use of the truck unreasonably dangerous as required to support plaintiff's negligent entrustment theory of liability.

With respect to the Budgets defendants' failure to submit copies their written rental policies and procedures and demonstrate that the Budget franchisee had followed those procedures, the Second Department further held:

Contrary to the plaintiff's contention, the appellants' failure to provide copies of any internal policies as to investigation of potential renters with restricted licenses constitutes an insufficient basis upon which to deny their motion for summary judgment.  Even if such a policy had been violated, under the circumstances of this case, such violation would not constitute actionable negligence (see Lambert v Bracco, 18 AD3d 619, 620; Newsome v Cservak, 130 AD2d 637, 638).

The first cause of action, which was based on the alleged vicarious liability of the appellants, was barred under the Graves Amendment (49 USC § 30106), as the appellants showed they are "owner[s] . . . engaged in the trade or business of renting or leasing motor vehicles" (49 USC § 30106; see Gluck v Nebgen, 72 AD3d 1023), and should also have been dismissed.