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House, Senate Approve Hwy Bill with Amendment Removing Auto Leasing Companies from Vicarious Liability

Washington DC August 1, 2005; The AIADA newsletter reported that lawmakers in the House and Senate on Friday approved the highly anticipated Highway bill, moving the legislation to the President’s desk.

The House passed its conference report with a 412 to 8 vote. The senate passed their version the same afternoon with a 91 to 4 vote. Included in both chambers’ versions is an amendment offered by Sam Graves (R-MO), which preempts state laws regarding vicarious liability for rental car and truck owners.

The amendment would eliminate liability under state law for an owner of a motor vehicle or their affiliate who is engaged in the business of renting and leasing motor vehicles provided there is no negligence or criminal wrongdoing on the part of the motor vehicle owner or affiliate. The owner or affiliate, however, must maintain the required state limits of financial responsibility for each vehicle in accordance to the states where the vehicle is registered.

The auto renting and leasing industry praised the amendment as a huge victory that will benefit both consumers and businesses in terms of lower costs and increased transportation options. “This has been a long-fought battle,” said the Truck Renting and Leasing Association (TRALA) president and CEO Peter J. Vroom. “We have been successful in reforming vicarious liability laws at the state level for many years. But with the interstate nature of our national rental and lease fleets, federal action was essential to create uniformity that no state can impose vicarious liability.

This is simply common sense tort reform. Renting and leasing companies that put safe vehicles in the hand of eligible drivers should not be held liable for actions over which they have no control.” Also included under the new bill is a requirement that the National Highway Traffic Safety Administration produce the first performance standards aimed at decreasing the likelihood of rollovers, reports The Washington Times.

Congress mandated that NHTSA subject fifteen-passenger vans for the first time ever to government crash tests and bar schools from buying or leasing 15-passenger vans unless they are redesigned to meet the same safety requirements as school buses. Among other things, NHTSA is also required to overhaul the test for vehicle roof strength and produce a timetable for implementing new side impact tests aimed at mitigating risks posed by sport utility vehicles and pickup trucks when they collide with cars.

The final bill provided to the President includes a 6-year spending level of $286.4 billion for FY04-09. President Bush had threatened to veto any bill exceeding $283.9 billion.