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by rayiner 5141 days ago
If owners are not liable, what stops the owners of inherently dangerous businesses like car rentals from shielding themselves from the inherent risks created by their activity by having judgment-proof operators operate that risk-creating business?

The issue here is not regulation of lobbying. It's the very simple fact that driving a car creates substantial risks that have a price. Someone must pay that price. Owners and operators of dangerous instrumentalities are much more appropriate to bear that price than injured third parties. Owners are much more likely to be able to bear the cost than operators. If you shield owners, than you are practically shifting the burden to the public. I.e. socializing the costs. Yes it's great for small businesses to shift the costs of their profit-making activity to the public.

Ms. Fong's ownership of the car gives her the right to profit by renting it. It is fair to link that right with the obligation for risks created by that profit-making activity.

4 comments

Judgement-proof operators? Nowhere was it suggested that operators ought be judgement-proof. In fact, I suggested the exact opposite.

The issue is exactly one of lobbying. As the article notes, the auto insurance industry has successfully lobbied to pass the Graves Amendment, which nullifies vicarious liability for auto rental. The article mentions this, and you can read more here: http://codes.lp.findlaw.com/uscode/49/VI/A/301/I/30106

Car rental owners are shielded by this lobbied-for legislation. The only question is whether Ms. Fong will qualify as a rental agency for the purposes of this law.

This is precisely a case where an industry has lobbied for an exemption which may exclude others from competing in said industry. It is a textbook example of regulation preventing disruption of an established industry.

Judgment-proof in the sense that the operator has no assets with which to pay the judgment.

The operator here is liable. But if the operator has insufficient assets to satisfy the damages, the owner is a more sensible person to bear the costs of the accident than the injured party.

You're suggesting that the person at fault is the person who has money.

This is fundamentally unjust.

When a joint enterprise accidentally injures a third party, generally all possible outcomes are fundamentally unjust. That's what makes tort law interesting.
It appears you're suggesting a structure of a business, where the owner isn't leasing to an unrelated party. An employer is liable for the actions of his employees (even non-employee employees) through entirely separate and much more appropriate channels.
By "judgement-proof" I believe he meant that the operators probably don't have much money and therefore you could win a case against them, but you could not collect. This is contrasted with the owners of the hypothetical car rental firm that would have assets that could be taken.
And if the hypothetical car rental firm has no assets, let's take the assets directly from the nearest bank! Those guys always have money!
Most car owners also don't have a few million dollars in cash lying around, so they are equally "judgement proof". The way we have solved that problem is to legally require driver's insurance. It seems to me that that's a sufficient solution: as long as drivers are required to have insurance, there should be no problem with only holding drivers (not car owners) liable?
So what if ms fong dies next next? Is the manufacturer now responsible since they are the next step up in the ladder of profiters of the car?

You could assign the consequences of blame arbitrarily like that but it would have negative consequences on society. For example people would be less likely to do anything since association can now always lead to 100% blame. It's like a mobster who tries to get you to repay a relative's debts. That never makes sense and neither does this.

Presuming Ms. Fong was driving, and her death was caused by operator error, she would likely be to blame. If her death is caused by a mechanical issue - yes, the manufacturer could be held liable.
If the manufacturer is at fault, then the manufacturer is responsible. If Ms. Fong was at fault, then she would be responsible.

However the problem here is that the renter was at fault, but he/she is dead, so now they're trying to pin the responsibility on the closest related entity (even though with NO fault by Ms. Fong) that can also pay the costs.

If the person who died (or his/her family) has no claims to compensation from Ms. Fong, then why would the people he/she injured have any claims from her?

...and if the manufacturer goes out of business, are the manufacturers of the parts in the car liable? And after that, the suppliers of the raw materials in those parts?
If owners are not liable, what stops the owners of inherently dangerous businesses like car rental

How exactly is car rental an "inherently dangerous business," in the absence of a legion of berserk trial lawyers doing everything in their power to make it so?

Seems like a near-perfect illustration of begging the question.