Automobile Liability

On appeal, the Supreme Court of New York, Appellate Division modified the lower courts order denying the respondents motion for summary judgement in part, reinstated the plaintiffs’ vicarious liability claims against the respondent, and granted the plaintiffs cross-motion in part by dismissing plaintiff’s affirmative defense based on the Graves Amendment. As modified, the order was affirmed without costs. Kelly v. Prohaska, 2024 NY Slip Op 00527, 224 A.D.3d 1254, 205 N.Y.S.3d 304 (App. Div.).

This case arises from a motor vehicle accident involving a van owned by Snap-On Credit LLC (respondent) and leased to Prohaska (defendant), a franchisee of a company affiliated with respondent. The Graves Amendment, 49 U.S.C.S. § 30106(a)(1), provides that the owner of a leased or rented motor vehicle cannot be held liable for personal injuries resulting from the use of such vehicle if: (1) the owner is engaged in the trade or business of renting or leasing motor vehicles, and (2) there is no negligence or criminal wrongdoing on the part of the owner or its affiliates. The court found that the respondent established it was free of direct negligence, as it was not responsible for hiring or supervising the defendant, who was not its employee. However, the respondent failed to meet its burden of proving that it was engaged in the trade or business of renting or leasing motor vehicles within the meaning of the Graves Amendment. The evidence showed that Respondent leased only one type of vehicle (vans) exclusively to franchisees and did not lease vehicles to the general public. The court concluded that the respondents submissions did not sufficiently demonstrate the applicability of the Graves Amendment.