Car Accidents
The at-fault driver isn't always the only one who has to pay. A vehicle's owner, an employer, or a bar that overserved may also be liable — often meaning another insurance policy behind your claim.
When someone is seriously injured in a car accident, the most obvious person responsible is usually the driver who caused the crash.
But that driver may not be the only person or company legally responsible.
“One of the things I look at when investigating a serious car accident is whether there are other parties that contributed to the accident or can legally be held responsible for the driver’s negligence. This can be extremely important, particularly when the at-fault driver has limited insurance coverage.”
Steven Palermo
Depending upon the circumstances, the owner of the vehicle, the driver’s employer, a bar or restaurant, a rental company, or another business may also be responsible.
That is why a proper investigation should go beyond simply asking who was driving.
The driver who caused the crash is rarely the only party who can be held responsible. Depending on the circumstances, several others may share liability — and each can mean another insurance policy behind your claim.
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01
Vicarious Liability
The Vehicle Owner The owner of a vehicle can generally be held responsible for the negligence of anyone driving it with the owner’s express or implied permission — even if the owner did nothing wrong.
VTL § 388
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02
Scope of Employment
The Driver’s Employer When an employee negligently causes a crash while acting within the scope of employment, the employer may also be responsible. The key question is what the driver was doing at the time and why.
Respondeat superior
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03
Ownership Exception
Rental & Leasing Companies A qualifying rental or leasing company generally cannot be held liable just because it owns the vehicle — but it can still be responsible for its own negligence, such as negligent entrustment or maintenance.
Graves Amendment
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04
Conduct-Based
Negligent Entrustment You should not give control of a vehicle to someone you know or should know cannot operate it safely. This claim is based on the conduct of whoever supplied the vehicle, not merely on ownership.
Based on supplier’s conduct
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05
Liquor Liability
A Bar or Restaurant New York’s Dram Shop law can create a separate claim against an establishment that unlawfully served alcohol to a visibly intoxicated person, or to someone under 21, who then caused the crash.
NY Dram Shop Act
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New York has a particularly important law dealing with vehicle ownership and liability.
Under New York Vehicle and Traffic Law § 388, the owner of a vehicle can generally be held responsible for the negligence of someone who was operating the vehicle with the owner’s express or implied permission.
This is known as vicarious liability.
A simple example is a parent who owns a vehicle and allows a adult child to drive it. If the child negligently causes an accident, the injured person may have a claim against both the driver and the owner of the vehicle.
The owner does not necessarily have to have done anything wrong.
The owner’s liability can arise from the driver’s negligence because New York law places responsibility upon an owner who permits another person to operate the vehicle.
This is one reason that when I investigate a Long Island car accident, I want to know not only who was driving, but also who owned every vehicle involved.
Permission can become a major issue.
An owner may claim that the driver was not allowed to use the vehicle. That does not necessarily end the case.
Permission can be express or implied. There may also be factual questions concerning how the driver obtained the vehicle, whether the driver had used it previously, where the keys were kept, and whether the owner had previously allowed that person to drive.
These cases can become very fact specific.
Simply having the owner say, “I never gave permission,” does not necessarily mean that the owner is automatically out of the case.
A stolen vehicle presents a very different situation.
New York’s owner liability law is based upon the vehicle being operated with the owner’s express or implied permission. If someone actually steals a vehicle and then causes an accident, the owner ordinarily would not be vicariously responsible for the thief’s negligent driving because there was no permission.
But I would not necessarily accept the word “stolen” without investigating further.
Was the vehicle actually reported stolen? When was it reported? Who was driving it? What was the relationship between the driver and owner? Had that person driven the vehicle before? How did the person obtain the keys?
The facts matter.
There is a significant difference between a vehicle that was truly stolen by a stranger and an owner claiming after an accident that a friend or relative “wasn’t supposed to be driving it.”
Another important area of vicarious liability involves employers.
If an employee negligently causes an accident while acting within the scope of employment, the employer may also be responsible for the employee’s negligence.
Consider a delivery driver who runs a red light while making deliveries. The driver may be personally negligent, but the employer may also be responsible because the employee was performing work for the employer when the accident happened.
The same issue can arise with salespeople, service technicians, construction workers, truck drivers and employees who drive from one location to another as part of their jobs.
The fact that someone is employed by a company does not automatically make the company responsible for everything that person does.
The important question is whether the employee was acting within the scope of employment when the accident occurred.
For example, an employee driving a company vehicle while making a delivery is very different from an employee using a vehicle entirely for a personal purpose unrelated to work.
There can also be difficult cases involving employees traveling to or from work, making personal stops during a work trip, or combining business and personal activities.
These cases require looking carefully at what the driver was doing at the time of the accident and why.
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The at-fault driver may not be the only one who has to pay. A thorough investigation can uncover an owner, employer, bar, or other party — and another source of recovery. If you were seriously injured in a Long Island car accident, Palermo Law offers a free consultation, and there’s no fee unless we recover money for you.
Rental and leasing companies are treated differently.
Ordinarily, New York’s vehicle owner liability law can make an owner responsible for the negligence of a permissive driver. However, a federal law known as the Graves Amendment provides substantial protection to companies engaged in the business of renting or leasing motor vehicles.
Generally, a qualifying rental or leasing company cannot be held vicariously liable simply because it owns the vehicle that its customer negligently operated.
This is an important exception to New York’s usual vehicle owner liability rule.
So, if someone rents a vehicle from a major rental car company and causes an accident, you generally cannot hold the rental company responsible merely because its name is on the title.
The same general protection can apply to qualifying vehicle leasing companies.
The Graves Amendment does not give rental companies complete immunity.
There is an important distinction between holding a rental company responsible because it owned the vehicle and holding it responsible because the company itself was negligent.
For example, there may be circumstances where a rental company negligently entrusts a vehicle to someone it knew or should have known was not competent to operate it safely.
There could also potentially be a claim based upon the rental company’s own negligent maintenance or other independent wrongdoing if that negligence contributed to the accident.
These are not simply claims based upon ownership. They are claims based upon what the company itself did or failed to do.
That distinction can be critical.
Negligent entrustment is another way that someone other than the driver can potentially be responsible for an accident.
The basic idea is fairly straightforward.
You should not give someone control of a dangerous instrumentality, including a motor vehicle, when you know or reasonably should know that the person is not capable of using it safely.
For example, depending upon the evidence, questions may arise if someone gives a vehicle to a person known to be an unsafe or incompetent driver.
The important point is that negligent entrustment is based upon the conduct of the person or business that supplied the vehicle. It is different from ordinary vicarious liability.
Some of the most serious car accident cases I handle involve intoxicated drivers.
In the right circumstances, my investigation does not stop with the drunk driver.
New York’s Dram Shop law can create a separate claim against a bar, restaurant or other commercial establishment that unlawfully sold alcohol to the person who later caused the accident.
For example, New York law prohibits the sale of alcohol to a visibly intoxicated person. The law also prohibits sales to people under 21.
If an establishment unlawfully serves alcohol and that alcohol contributes to the person’s intoxication and the resulting accident, the injured person may have a claim against the establishment in addition to the claim against the driver.
This can become extremely important when a drunk driver causes catastrophic injuries but carries relatively little automobile insurance.
A Dram Shop claim may provide an entirely separate source of recovery.
This is one of the reasons I believe serious car accidents should be investigated as early as possible.
Suppose someone suffers devastating injuries and the negligent driver has only a small automobile liability policy.
If the investigation stops there, it may appear that there is very little insurance available.
But what if the driver was working?
What if someone else owned the vehicle?
What if the driver had just left a bar that continued serving alcohol despite obvious intoxication?
What if a company negligently entrusted the vehicle to the driver?
Those facts can completely change the case.
Finding another legally responsible party may also mean finding another insurance policy or another financially responsible defendant.
There is another point that is sometimes misunderstood.
Finding additional defendants does not eliminate New York’s serious injury threshold.
New York is a No-Fault state. In most automobile accident cases, an injured person seeking compensation for pain and suffering must still establish a serious injury as defined by New York Insurance Law § 5102(d).
That requirement does not disappear simply because the owner, an employer or another defendant may also be responsible for the accident.
The liability question and the injury question are separate.
We still have to establish that someone was legally responsible for causing the accident, and we still have to establish that the client’s injuries satisfy New York’s serious injury requirements in order to recover pain and suffering damages in a covered motor vehicle case.
You can read more about New York No-Fault insurance and the serious injury requirement.
When I investigate a Long Island car accident, I don’t want to assume that the person whose name appears as “Driver 1” on the police accident report is the beginning and end of the case.
| 1 | Who owned every vehicle involved?
Under New York’s owner liability law, the person who owned the car may be responsible for the driver’s negligence — so I want to know who owned each vehicle, not just who was behind the wheel. |
| 2 | Why was the driver on the road?
The reason someone was driving can open up an entirely separate claim, particularly if they were running an errand or task for someone else at the time. |
| 3 | Was the driver working?
If the driver was acting within the scope of employment, the employer may also be responsible. That can mean another insurance policy standing behind the claim. |
| 4 | If alcohol was involved, where was the driver drinking?
A bar or restaurant that unlawfully served a visibly intoxicated driver may face a separate Dram Shop claim — often critical when a drunk driver carries little insurance. |
| 5 | Was the vehicle rented, leased, borrowed, or supplied by a business?
That relationship matters. It can raise questions of negligent entrustment or a company’s own independent negligence, beyond simple ownership. |
Sometimes those questions lead nowhere. Other times, they uncover an entirely separate claim that would otherwise have been missed.
That can make an enormous difference when someone has suffered a serious injury.
If you were seriously injured in a car accident on Long Island, Palermo Law offers free consultations. We represent injured people throughout Nassau and Suffolk Counties from our nine Long Island locations. You pay no attorney’s fee unless we recover money for you.
Yes, in many cases. New York Vehicle and Traffic Law § 388 generally makes a vehicle owner responsible for injuries caused by someone operating the vehicle with the owner's express or implied permission. This means both the negligent driver and the vehicle owner may potentially be defendants in a New York car accident lawsuit.
That does not necessarily end the claim against the owner. Permission can be express or implied, and the circumstances surrounding the driver's use of the vehicle matter. Prior use of the vehicle, access to the keys and the relationship between the driver and owner may all become important evidence.
Generally, an owner is not vicariously liable for the negligent operation of a vehicle that was actually stolen because the thief did not have permission to drive it. However, whether the vehicle was truly stolen can become a factual issue, particularly when the driver and owner knew each other before the accident.
Potentially. If the driver caused the accident while acting within the scope of employment, the employer may be vicariously responsible for the employee's negligence. Whether the driver was working at the time can therefore be an important part of investigating a serious commercial or work-related vehicle accident.
Not necessarily. An employer is not automatically responsible simply because the negligent driver is an employee. Courts generally look at whether the employee was acting within the scope of employment. Commuting, personal errands and trips involving both business and personal activities can raise more complicated factual and legal questions.
Usually not merely because the rental company owns the vehicle. The federal Graves Amendment generally protects qualifying rental and leasing companies from vicarious liability based solely upon vehicle ownership. However, that protection does not necessarily prevent claims based upon the rental company's own negligence or criminal wrongdoing.
Potentially. The Graves Amendment protects qualifying rental companies from liability based simply upon ownership, but it does not protect them from their own negligence. A negligent entrustment claim requires evidence that the company negligently provided the vehicle to someone it knew or should have known was unfit to operate it safely.
Possibly. New York's Dram Shop law can permit a claim against a commercial establishment that unlawfully sold alcohol to a visibly intoxicated person or someone under 21 when the unlawful sale contributed to the intoxication and resulting injuries. These claims require evidence concerning the driver's drinking before the accident.
Identifying additional responsible parties can provide additional sources of insurance coverage and recovery. This can be especially important when the negligent driver has limited insurance but the injuries are severe. A thorough investigation may uncover an owner, employer, business or other party with separate legal responsibility for the accident.
Generally, yes. Adding a vehicle owner, employer or other responsible defendant does not by itself eliminate New York's serious injury requirement. In a covered automobile accident case, an injured person generally must still satisfy New York's serious injury threshold to recover damages for pain and suffering.
The information provided in this blog is for general informational purposes only and reflects the opinions of the author. It is not legal advice and does not create an attorney-client relationship. Every case is different, and results depend on the specific facts and applicable law. You should not act or rely on any information in this blog without first seeking advice from a qualified attorney regarding your individual situation.
