II

106TH CONGRESS

1ST SESSION S. 1130

To amend title 49, United States Code, with respect to liability of motor

vehicle rental or leasing companies for the negligent operation of rented

or leased motor vehicles.

IN THE SENATE OF THE UNITED STATES

MAY 26, 1999

Mr. MCCAIN (for himself. Mr. ASHCROFT, Mr. BOND, Mr. BURNS, Mr. GORTON, and Mr. INHOFE) introduced the following bill; which was read twice

and referred to the Committee on Commerce, Science, and Transportation

A BILL

To amend title 49, United States Code, with respect to

liability of motor vehicle rental or leasing companies for

the negligent operation of rented or leased motor vehicles.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Motor Vehicle Rental

5 Fairness Act of 1999’’.
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1 SEC. 2. FINDING.

2 The Congress finds that the vicarious liability laws,

3 the ultimate insurer laws, and the common law in a small

4 minority of States—

5 (1) impose a disproportionate and undue bur6 den on interstate commerce by increasing rental

7 rates for motor vehicle rental and leasing customers

8 throughout the United States; and

9 (2) pose a significant competitive barrier to

10 entry for smaller motor vehicle rental and leasing

11 companies attempting to compete in these markets,

12 in contravention of a fundamental principle of fairness

13 that there should be no liability in the absence of fault.

14 SEC. 3. LIMITATION ON LIABILITY.

15 (a) IN GENERAL.—Part C of subtitle VI of title 49,

16 United States Code, is amended by adding at the end

17 thereof the following:

18 ‘‘CHAPTER 333. LIABILITY FOR COMPANIES

19 THAT RENT OR LEASE MOTOR VEHICLES.

‘‘Sec.

‘‘33301. Limitation of liability.

20 ‘‘§ 33301. Limitation of liability

21 ‘‘(a) IN GENERAL.—Notwithstanding any State stat22 utory or common law, no State or political subdivision of

23 a State may hold any business entity engaged in the trade

24 or business of renting or leasing motor vehicles liable to
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1 others for harm caused by a person to himself or herself,

2 to another person, or to property resulting from that per3 son’s operation of a rented or leased motor vehicle solely

4 because that business entity is the owner of the motor ve5 hicle.

6 ‘‘(b) APPLICATION WITH CERTAIN OTHER LAWS.—

7 ‘‘(1) NEGLIGENCE.—Subsection (a) does not

8 apply to liability imposed under a State’s statutory

9 or common law based on negligence of a motor vehi10 cle owner.

11 ‘‘(2) FINANCIAL RESPONSIBILITY LAWS.—Noth12 ing in this section supersedes the law of any State

13 or political subdivision thereof—

14 ‘‘(A) imposing financial responsibility or

15 insurance standards on the owner of a motor

16 vehicle for the privilege of registering and oper17 ating a motor vehicle; or

18 ‘‘(B) imposing liability on business entities

19 engaged in the trade or business of renting or

20 leasing motor vehicles for failure of such entity

21 to meet financial responsibility or liability in22 surance requirements under State law.

23 ‘‘(c) DEFINITIONS.—In this section:

24 ‘‘(1) BUSINESS ENTITY.—The term ‘business

25 entity’ means a sole proprietorship, corporation,
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1 trust, limited liability company, association, firm,

2 partnership, society, joint stock company, or other

3 legal entity, and includes a department, agency, or

4 instrumentality of the government of the United

5 States, a State, or a political subdivision of a State.

6 ‘‘(2) MOTOR VEHICLE.—The term ‘motor vehi7 cle’ has the meaning given that term by section

8 13102(14).

9 ‘‘(3) OWNER.—In this section, the term

10 ‘‘owner’’ means—

11 ‘‘(A) a person who is a record or beneficial

12 owner or long-term lessee of a motor vehicle;

13 ‘‘(B) a person entitled to the use and pos14 session of a motor vehicle subject to a security

15 interest in another person;

16 ‘‘(C) a lessee or bailee of a motor vehicle

17 in the trade or business of renting or leasing

18 motor vehicles, having the use or possession

19 thereof, under a lease, bailment, or otherwise.

20 ‘‘(4) PERSON.—The term ‘person’ has the

21 meaning given to it by section 1 of title 1, but also

22 includes a government entity.

23 ‘‘(5) GOVERNMENT ENTITY.—The term ‘gov24 ernment entity’ means an agency, instrumentality,

25 or other entity of Federal, State, or local govern-
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1 ment (including multijurisdictional agencies, instru2 mentalities, and entities).’’.

3 (b) CONFORMING AMENDMENT.—The analysis for

4 part C of subtitle VII of title 49, United States Code, is

5 amended by inserting after the item relating to chapter

6 331, the following:

‘‘333. Liability for companies that rent or lease motor vehicles .............. 33301’’.

7 SEC. 4. EFFECTIVE DATE.

8 Section 33301 of title 49, United States Code, as

9 added by section 3 of this Act, applies to any civil action

10 commenced on or after the date of enactment of this Act.

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