Negligent Entrustment: Car Rentals

Flores v. Enterprise Rent-a-Car Company, (Second District, September 28, 2010) —Cal.Rptr.3d —- 188 Cal.App.4th 1055, 2010 WL 3749502, 10 Cal.Daily Op. Serv. 12,606, 2010 Daily Journal D.A.R. 15,174

The parents of a boy who suffered fatal injuries after he was struck by a rental car brought an action for negligent entrustment against Enterprise Rent-a-Car Company of Los Angeles and Enterprise Rent-a-Car Company. The plaintiffs alleged that the driver of the vehicle was under the influence of marijuana and the drug Ativan at the time of the accident, and that he had been convicted of driving under the influence of August of 2002 and May of 2003. The plaintiffs also alleged that the standard of practice for rental car companies is to screen potential renters for past convictions for driving under the influence of drugs or alcohol, and to refuse to rent vehicles to customers with a conviction within the previous 48 months.

The trial court granted summary judgment, holding that because the driver of the vehicle had a valid driver’s license and had given no indication that he was unfit to drive at the time of the rental, there was no additional duty on the part of the defendants to investigation his DMV records. The court of appeal affirmed, holding that Osborn vs. Hertz Corporation (1988) 205 Cal.App.3d 703, 252 Cal.Rptr. 613, should not be revisited, despite the more recent availability of electronic driver’s license checks:

“Although rental car companies now have the ability to gain access to computerized records of their customers’ driving histories, the rationale of Osborn remains valid. True, such a check might show, for instance, a previous conviction of driving under the influence, but as a policy matter we question whether, based solely on that information, a rental car agency should be deemed to have violated its duty of due care if it rents a car to that customer. Plaintiffs’ argument in the present case, like the argument made by the passenger in Osborn, contains the implicit premise that a conviction of driving under the influence disqualifies a person from renting a vehicle, even though the person currently possesses a valid license. As the court in Osborn reasoned, such a rule would “disturb [the] carefully considered balance” “struck by the Legislature between the dangers of drunk driving and the recognition that driving a car may be ‘essential in the pursuit of a livelihood.’ ” (Id. at p. 711, 252 Cal.Rptr. 613.) Thus, Osborn’s conclusion that rental car companies have no duty to inquire into the driving histories of their clients remains viable, as applied to the instant case.
. . .
[w]e conclude that through sections 14604 and 14608 the Legislature has circumscribed the duty of a rental car agency to investigate the license status (and, by implication, the driving history) of its customers. That duty does not extend to making an electronic check of customers’ driving records. Any decision to extend a rental car agency’s duty of investigation to include such a search is for the Legislature, not the courts. As a matter of law, therefore, a rental car agency is not liable for negligent entrustment where the agency has fully complied with the requirements of sections 14604 and 14608, and the customer does not appear impaired or otherwise unfit to drive at the time of rental.”

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