Rental Firm Not Liable If Driver Lies About License, Miss. Court Decides

By | December 4, 2006

Rental car companies are not liable for accidents that result from their unknowingly leasing a car to a motorist who lies about having a valid driver’s license, the Mississippi Supreme Court has ruled.

The court, in a recent 5-4 decision, said if the driver presents a license that looks legal, the rental car company can use that to defend itself against damage lawsuits.

The ruling came in a lawsuit filed by Lealue and Richie Cousin against Enterprise Rent-A-Car and employee Jana Kellems. A Chickasaw County judge ruled for Enterprise and the Kellems in February.

According to the court record, Kellems rented a car to Schiquita Rogers in Tupelo on March 22, 2002. Rogers provided an unexpired Mississippi license. However, what Kellems didn’t know was that Rogers’ license had been suspended. The rental contract that Rogers signed also had a clause where Rogers said she had a valid drivers license.

Enterprise’s procedures — and state law — required employees to inspect and check the driver’s license of a potential customer, then compare and verify the signature of the customer written on the rental agreement in the employees presence with that on the license.

State law requires that no one can rent a motor vehicle unless they are “then duly licensed.”

On March 23, 2002, Rogers ran a stop sign in Chickasaw County and collided with a vehicle driven by Lealue Cousin, who was injured. Rogers was cited for driving with a suspended license, to which she later pleaded guilty.

The Cousins sued Enterprise and Kellems alleging negligence for renting a car to a person who did not have a valid license.

Circuit Judge Henry L. Lackey ruled that Rogers presented a driver’s license that appeared to be valid and unexpired. He said Enterprise and Kellems followed the law in renting the car.

On appeal, the Cousins said state law requires persons renting a car to be “then duly licensed,” which they said meant Rogers had to have had a valid license at the time she rented the car.

Enterprise said it followed the law and was not negligent.

Justice George C. Carlson Jr., writing Thursday in the Supreme Court’s 5-4 decision, said the case centered on the meaning of “then duly licensed.”

He said the Cousins wanted the court to “interpret the statute literally and require that rental car companies request the status of each potential renter’s driver’s license from the Mississippi Department of Public Safety before renting the car. Cousin states that rental car companies could receive this information ‘within a couple of days’ after the request.”

“On the other hand, Enterprise urges this court to interpret the statute as a whole. It argues that ‘then duly licensed’ means that the potential renter must produce a facially valid, unexpired driver’s license,” Carlson said.

Carlson said Enterprise argued that if the Legislature wanted rental companies to check with MDPS then it would have written it into the law. Carlson said the law has remained virtually unchanged since 1938.

The justice said the Cousins wanted the law to mean that rental car companies could only rent cars to drivers with currently valid driver’s licenses.

“We find Cousin’s argument to be wholly unpersuasive and thus hold that Enterprise was not negligent … because the statute only places a burden on rental car companies to accept facially valid, unexpired driver’s licenses,” Carlson said.

He said Enterprise followed the law and could not be found negligent.

Justice Jess Dickinson, in a dissent joined by three other justices, said the ruling means rental car companies can now avoid liability for renting an automobile to a person with an invalid drivers license by simply arguing that the license appeared to be valid.

“The majority considers a person who possesses an invalid drivers license that appears valid to be ‘then duly licensed,”‘ Dickinson said.

Dickinson said the case should have been presented to a jury.

“I acknowledge the difficulty visited upon rental car companies by the language of the statute and the consequences of its application. However, the decision of whether to alleviate that difficulty rests with the Legislature, not us,” he said.

Dickinson said there was nothing in the case that suggested Enterprise had a constitutional right to rent a motor vehicle to a person with a license which was invalid, but appeared to be valid.