This kind of reminds me of AirBnB, where new forms of renting rely, in part, on deceiving users about the risks. RelayRides and AirBnbB business models rely in part on the savings from inadequate insurance coverage, where individuals are suckered into taking on commercial risks while still carrying only individual insurance and having unlimited personal liability.
For this to make sense the number of the appartments (or cars) destroyed or damaged must me low enough that the cost for repairing is way lower than AirBnB revenues. Not sure this is possible with only 10% fee on renting although.
If she had failed to get some maintenance that made the car dangerous to drive, that would be one thing. But there is no indication that this is the case.
If a psychopath rents a VHS from Blockbuster and then uses it to bludgeon someone's head in, is Blockbuster liable for that act of violence? Sure, a VHS is not intended to be used this way, but a car is not intended to be crashed either.
If you can hold the owner of a car liable for a crash then what stops you from holding the creator of a car liable for a crash? Why not go after Toyota? By this line of reasoning Toyota is just as culpable as Ms. Fong.
Indeed, some tort actions have gone beyond owners and even pursued manufactures -- particularly gun manufactures.
The idea that an object owner or object creator might be liable for the actions of an object user is unreasonable and perverse. It has a chilling effect on innovation and forces small businesses (who can't afford to lobby regulatory protections such as the Graves amendment) out of the market.
Except that in this case there's another party: RelayRides, the rental management company. I think their own actions indicate an awareness that they will have to foot the bill for this... not just because Ms. Fong-Jones could probably recover her own costs, if any, in court, but also because the survival of their business depends on it.
Anyone with a driver's license and enough money can walk into a car dealership and be "operating the dangerous instrument" an hour later. In this case would the car dealership be liable for a crash? Should they be vetting who they sell cars to? Or what about the state that issued the driver's license? After all, it's their actual job to vet drivers. By your logic the DMV should be liable for every accident caused by a driver with a valid license.
Shares in a company whose factory gets wiped out by a hurricane you will experience a loss. This isn't the shareholders' fault, but it is a risk assumed by owning the asset. The shareholders could later sue management for being negligent and management could sue the construction company or risk advisor who said hurricane insurance is bull, etc. But the risk first comes to roost with the owners. A similar outcome would be expected if a tree on the factory premises toppled over and killed a pedestrian.
The principle difference between my example and the RelayRides case is the limited liability afforded by a common stockholder versus unlimited liability of a sole proprietorship (which is what you operate as if you directly interact with RelayRides as a natural person).
P.S. Those of you piping up about how this could never happen in Europe, note that this is because European countries tend to have higher insurance caps. In this case I would expect, in my completely un-qualified opinion, RelayRides to be ultimately responsible for implying that a $1 million liability cap was sufficient.
There's an adverse selection problem with RelayRides: terrible drivers who cannot afford or obtain auto insurance will be over-represented among their customers.
For example, is liability held by the biological parent, or by an entity acting in loco parentis? The distinction is crucial, as it is similar to the difference between an owner of a car, and a renter of a car.
With pets, again, if I lease or rent a pet it is not the case that the owner is necessarily responsible for the pet while I have possession. They may, but they also may not -- and it's this uncertainty which drives much frustration with tort law.
The fact of the matter is that cars are dangerous instrumentalities. A car accident can create enormous costs. In car sharing, someone must bear the cost of this risk. With its $1m of liability insurance, RelayRides is taking on a fixed amount of risk, and allocating the rest to the car owner. I think you'd be stupid to take on this risk without more compensation than what RelayRides provides, but that's what Ms. Fong signed up for.
Both civil and criminal liability for killing and injuring others with a car non-commercially are incredibly cheap. The usual penalty for killing someone with a car is no penalty at all, even though over one hundred people a day die from driver negligence.
The above sort of BS is my complaint about the tort system. I've been hit by a car crossing the center line and plowing into my car. It didn't change how I feel about getting into a car, at least not in any debilitating way. I am perhaps (sometimes) a bit more alert to whether oncoming cars seem to be drifting towards the line. And please tell me how "pain and suffering" compensation is going to remedy any "feelings" you have about getting into a car?
Absolutely disgusting. Our system punishes those brilliant and capable minds that can drive the nations economy. Meanwhile, underachievers everywhere can sleep peacefully.
Unless her car was in a state of disrepair, any lawyer (off the record) would have to admit she couldn't be responsible. But hey, assigning liability is so much more lucrative than truth.
Also,
> "RelayRides rejects any suggestion that it is acting in a self-interested manner. “Our interest is in protecting Ms. Fong,”"
and
> When I asked the company whether this meant cutting a check to Ms. Fong-Jones if she ended up personally liable, Alex Benn, a lawyer who oversees insurance for the company, had this to say: "What happens in any sort of accident with insufficient coverage?..."
seem at odds.
This is a ridiculous statement. "Underachievers" (whatever the hell that means) certainly don't sleep any better for lack of an Ivy league education or salary from Google. I think most would agree that "our system" treats highly paid tech workers with elite educations pretty well, all things considered.
Liability insurance isn't strictly unlimited, the coverage limits are just very high - e.g. in Germany, personal damages are covered with a minimum of 7,5 mio. euro (with a maximum limit of 8 to 15 million per person, depending on the insurance company), and total damage is mostly limited at 50-100 mio. euro. For most accidents, these numbers are fairly equal to "unlimited".
About health insurance - I'm not quite sure how you come at the conclusion that state pays everything. Injuries in an accident are paid for by the liable party's liability insurance, the same as in the U.S.
In other countries i paid that per year for way more peace of mind.
But if it's the car that's insured, why do specific drivers have to be listed on the policy? The way I understand it is even if I'm not listed on someone's policy and I'm driving their car, their auto insurance covers my fuck up when I cause an accident.
Doesn't seem right, but I suppose that's the way it works.
Either the owner pay as if she wasn't doing a business, or the dead guy's pay as if he was driving a rental. Mine is pretty basic and i can pay my deductible for rentals.
It also seems from the article that they haven't determined who was at fault.
From the article: "According to a preliminary police report, their car was hit by an oncoming car that seemed to have been traveling south in their northbound lane. The report concluded that Mr. Fortuna would be found at fault."
Why am I liable for his actions?
This is the part of the rent-your-car story I just don't get. She had nothing to do with it. She should have zero liability. That's the part of the legal system that is really messed-up. Liability for this accident should sit squarely on the shoulders of those directly involved in causing it. The only way she should be liable is if the car had a known defect that caused the accident.
What if someone rented a car and intentionally drove it into a crowd of people?
Also I don't understand why people here say that "In car sharing, someone must bear the cost of this risk.". If lightning would stuck that car, who would they sue, Zeus?
For example I (being fully insured on my own car) could drive a friend's car without being specifically insured on it and were I to get involved in an accident (that was my fault) then damage to third parties are covered but damages to my friend's car are not unless his insurance specifically covers me.
If the renter doesn't have this insurance already simply increase the amount they have to pay to rent in order to cover it.
If you don't own a car it is just about impossible to buy a liability insurance policy. I know this. I tried. I tried very hard.
I don't own a car myself, but since I often rent a car when I travel, I decided that I'd try to buy a third-party liability policy instead of paying the absurd prices that Avis or Dollar charge (>$20 a day).
I called about 10-15 insurance brokers, and not one of them had ever written a "non-owner" policy. The standard answer I got was, "You have to own a car to get liability insurance; yes, it'll cover you for other vehicles you drive, but you have to have your own car for us to create a policy for you".
I realize that you are in the UK, so the situation might be different there. But in the US (and Canada), I think that RelayRides would have to be the one to provide the coverage, because the average RelayRides user (who likely lives in the same city and doesn't own a car) won't have his own liability insurance (and couldn't get it even if he wanted it!).
One of my contracts once required that I have $1 million in insurance company to work for them, including coverage for any employees traveling related to the work. That was 10 years ago though, and 1) I don't recall if the insurance included liability insurance, and 2) I think it only covered travel related to business, so while an odd-ball thought, it probably won't work for you.
What do the people in the NE (NYC, Boston) do? I thought that quite a few don't have cars but instead rent them for trips or for moving. Surely a number of them are in the same boat.
It seems that non-owner liability policies do exist; so says http://www.caranddriver.com/reviews/do-i-need-insurance-to-r... . For that matter, GEICO mentions the possibility at http://www.geico.com/information/aboutinsurance/auto/insight... .
And http://www.carsdirect.com/car-insurance/can-i-get-car-insura... "Every insurance provider is required to offer non owner car insurance, so you shouldn't have a difficult time finding this insurance if you need it. Well known providers such as State Farm, GEICO or Progressive are providers you might consider. Some banks offer auto insurance, so those that do will also be able to offer non owner car insurance." ... "Non owners insurance quotes are available from all of the major insurance companies. Progressive, Geico, State Farm, and Nationwide are just a few insurance companies that offer insurance coverage to people who do not own cars. You can also get quotes from insurance consolidators like esurance or netQuote."
For instance, Avis says [1]:
Avis provides liability coverage for its vehicles as required by applicable law. In most instances, this will include coverage for the renter or authorized driver up to the financial responsibility limits of the applicable jurisdiction at no additional charge. In some states, the liability coverage provided is excess to any other applicable coverage.
Excluded are CA, TX, UT.
Dollar has similar policies, but they are less specific in their generic policies [2]:
B. Third Party Liability Claims: Unless otherwise required by applicable law, a renter and/or any additional authorized driver (and the respective insurance company of each) is primarily responsible for all third party claims of personal injury, including death, and property damage caused or arising from the use and operation of the DOLLAR vehicle during the rental. (To the extent DOLLAR is required to provide coverage, in spite of the terms of the rental agreement, it shall only be in an amount necessary to satisfy the minimum financial responsibility limits required by applicable law.)
[1] Select (USA, Protections/Coverages, Automobile Liability) at https://www.avis.com/car-rental/content/render-faq.ac
I wonder if it would be possible to persuade them to insure a "theoretical car" that pays no road tax and does 0 miles per year.
The vehicles stay on the land.
By law the minimum for person damage is 7.5 million €, for property damage 1.12 million €. Usual sums are 50 or 100 million €.
So in the end it's very unlikely for something like that to happen in Germany.
I would not rent my car out unless the liability issue was better taken care of. But then again, I don't get car sharing vs. car clubs.
If you need your car so little that you can rent it out, why not just join Zipcar or another car sharing club?
If she researched a little more she would have not got a new hybrid but some old diesel. It's probably cleaner than agasoline hybrid doesn't generate all the upfront manufacturing garbage and batteries that are awful for the environment and reuse a car that is already made anyway.
While I'm not a fan of lung-clogging diesels, in this case, it may make a bit of sense. There are people in my area with 20-year-old or so diesel cars. They don't need need the same kind of driving maintenance that hybrids do.
I don't know if she has access to Zipcar or a similar service, but if she does, that would have probably been the best bet. Let someone else deal with the ownership, storage, maintenance and liability.
I was under the impression old diesels were dirtier than gasoline engines. New clean deisels like in Audi's no, but old ones? But you're saying they're cleaner?
Accordingly, when someone is found liable in tort, it doesn't necessarily mean the court is blaming them for the accident.
Let me give a classic example. Three men go out hunting. They come to a clearing, and two of the men go around on the left and the third goes around on the right.
A game bird flies up from the clearing when the two groups are on opposite sides. Both men on the left fire at the bird. One of them gets the bird. One of them misses the bird but hits their companion who was going around the right.
It is not possible to determine which man shot the bird and which shot the human. Both shooters claim that they definitely shot the bird, of course.
The third man sues the first two. There's no outcome that does not screw at least one of the three:
1. The court could find neither shooter is liable, since it cannot be proven which actually fired the errant shot. That screws the third man since he got shot and cannot collect damages from the shooter.
2. The court could find that both shooters are liable, and make each pay half the damages. Assuming each shooter can actually afford half the damages that is fair to the third man, but screws whichever shooter actually hit the bird.
3. Furthermore, in #3, support it turns out one of the shooters has a lot more money than the other. Then in addition to screwing one of the shooters, the third man could get screwed in that he might not be able to collect enough to cover his medical bills.
4. The court could find that the two shooters are jointly liable, and not even try to allocate blame between them. The third man can enforce the judgement against them however he wants. So, if one shooter has a lot of money and one does not, the third man would enforce against the one with the most money. This is good for the third man as it lets him get his medical bills covered. It potentially screws the wealthy shooter, though, if in fact he was the one who shot the bird--he's left holding the bag for all of the damages.
The way it actually happens in most states is #4. The idea is that of the three men the one who least deserves getting screwed is the guy who got shot, so we want to maximize the chances that he can recover full damages, and can do so quickly. Only #4 ensures that.
As far as the shooters go, if one of them isn't happy with the way the third man chooses to go about collating the damages, he's free to file a lawsuit against the other shooter to recover the amount he thinks he was unfairly forced to pay.
Note that even though one of the shooters did not shoot the third man, it was his shot that created the ambiguity as to which one of them did shoot the third man.
This is called "joint and several liability".
This is a pretty good system. It lets the party that is actually injured get damages quicker to get them on the road to recovery (and keep them from getting bankrupted by medical bills), but still lets the parties that contributed to the injury fight it out among themselves to figure out how, ultimately, the damages should be split among them.
Note: joint and several liability only applies to defendants who do have some liability, as determined by the court, I believe.
1. Both men that fired a shot are found liable because firing a shot knowing one of the men may be in a line of fire is irresponsible and potentially criminal.
2. None of the men that fired a shot are found liable because the third man went into a section of the forest he wasn't supposed to go into because by doing so he put human life under significant risk.
3. The establishment that manages the hunting grounds (a private organization, the state, or even the federal government) is found liable because it didn't properly segment the area to sufficiently prevent risk of human injuries.
4. All three men are found liable because they didn't properly define necessary rules in order to prevent risk of human injuries.
In fact, in this case I'd argue that it's irrelevant which man fired a shot that hit the third man. Either
a) Both mean fired when they weren't supposed to, in which case they're both liable.
b) The third man went where he wasn't supposed to, in which case he is fully liable for his own injuries.
c) A third party organization that manages the hunting grounds didn't properly set up the rules, in which case it is liable.
d) The men were responsible for setting up the rules themselves, in which case all three of them are liable.
If you look at the case this way, you can easily find an outcome that doesn't screw anyone. Someone was responsible for ensuring proper safety precautions, and they didn't do their job. That party (or group of parties) is liable. The others are not.
I don't understand how the owner of the car can be held responsible for the damages.
RelayRides, I would think, would be a better target, you might get more money faster but the reality here, unfortunate or not (depending on who's side you take,) is RelayRides is going to be sued and Ms. Fong is probably going to be sued too. Tell me why RelayRide's funders aren't the ones holding the bag here, figure that one out, you nearly never hear about that.
Sometimes it sucks. Sometimes people don't seem to mind. OJ Simpson was acquitted of murder (re: as in found not guilty by a jury) and yet he was sued for moneys due to the death of his ex-wife and her friend, everyone sort of felt okay with that. Ms. Fong, strictly speaking, didn't crash the car, but she stood to profit from the cars use and it was her car and she has insurance, she's going to likely get sued. It's a real bummer those folks got hurt, sounds pretty rough to me, I hope someone makes them whole or as whole as they can be. It's the system we've got.
Her making $10/hr off it really just doesn't seem to factor in in my mind. Wrecking the car wasn't an expected use of that rental.
It should be the driver and his estate that is responsible in the end. If that estate does not have enough resources to cover the damages, then... well, shit happens and sometimes there's just no recourse for bad luck.
Also, I've thought for some time that P2P car sharing should be over longer terms, like months.
"That's why we can't have nice things"
Too much liability issues and because of (most likely) an irresponsible driver now they're (or better, someone that can pin any cost on the injured) goes after the car renter, car manufacturer, road authority, etc. They'll probably make a way for Steve Jobs to be liable as well if they can, I guess
"no longer theoretical" No crap sherlock. People have been getting injured in car accidents for the past 100 years.
By getting into a car and driving you assume a non zero risk of being injured or killed in a car accident. Do you want zero risk? Live in a bubble
Now his suddenly becomes a multi-million dollar cash cow for several 3rd parties.
Except for the victims of course, who'll have to deal with giant health costs (because of similar excess liability and regulation meandering by the authorities and greed by the medical industry)
Sure, liability is important, if it involved a drunk driver for example, or a fault that comes from the car maker.
But there's always a risk! And preventing some risks causes even more risks sometimes.
By getting into a car and driving you assume a non zero risk of being sued for damages caused by a car accident.
Would you care to tell us why? As-is, I could rewrite your comment as "Java is better than C IMHO" and it would be exactly as useful.
It is easy to spot this: if the article implies even in a slight degree that you'll die if you use a web service, it is FUD
