If you have been hit by a rental car, then your potential recovery may be limited by the Graves amendment depending on the exact circumstances of the accident. Here is a brief overview of the amendment and what it may mean for your case:
To understand the gravity of the Graves amendment, you need to understand why it was instituted in the first place. Prior to the amendment, those who had been injured by rental cars would sue both the drivers and the rental companies. The car rental companies would be sued by the accident victims under the principle of vicarious liability. Vicarious liability is a legal principle that holds one party partially responsible for the negligence of a third party in situations where the first party has some control over the third party.
Since car rental companies tend to have deeper pockets (and higher auto insurance limits) than individuals, those who had been injured by rental cars would do everything in their power to get the rental companies involved. The rental companies saw this as an injustice – being held responsible for things they couldn't control. Congressman Sam Graves was also of the same idea and constituted an amendment to change the situation.
How and When Does It Apply
After the Graves amendment was passed, accident victims could no longer hold the car rental companies responsible for their damages. Therefore, if you are involved in an accident with a rental car, forget about going after the rental company and focus on other liable parties. What is more, the amendment is a federal law, which means it supersedes the applicable laws in your state.
As usual with laws and their amendments, the Graves amendment doesn't apply in all situations. In fact, it has been restricted to these two specific situations:
The Owner of The Car Is Engaged in Rental Car Business
The Graves amendment only applies to those who are in the business of renting or leasing vehicles. This means it doesn't apply to informal car rentals. For example, if you are hurt by a car, and you later learn that the driver had "rented" it from their friend or colleague, the Graves amendment will not apply. In such a case, you can still pursue your damages against the real owner of the car.
The Accident Wasn't Due to the Owner's Crime or Negligence
Secondly, Graves amendment only applies if the accident hasn't been linked to crime or negligence on the part of the rental or leasing company. For example, a company can't lease out a defective car and hide behind the Graves amendment when the defect causes an accident. This means you can still hold a car rental company responsible for your damages if you can trace your injuries back to their crime or negligence.
As you can see, the Graves amendment shields car rental companies from accidents their vehicles cause, but it isn't a blanket protection. Therefore, if you are hurt in such an accident, consult a car accident lawyer to help you identify all the responsible parties.