Opinion ID: 3015893
Heading Depth: 3
Heading Rank: 2

Heading: Michigan

Text: Michigan also imposes vicarious liability on the owners of vehicles. Its law provides that “[t]he owner of a motor vehicle is liable for an injury caused by the negligent operation of the motor vehicle . . . [if] the motor vehicle is being driven with his or her express or implied consent or knowledge.” Mich. Comp. Laws § 257.401(1) (2003) (“Subsection 1”). Liability is capped, however, in certain circumstances: “[The liability of] a person engaged in the business of leasing motor vehicles who is the lessor of a motor vehicle under a lease providing for the use of the motor vehicle by the lessee for a period of 30 days or less . . . is limited to $20,000.00 because of bodily injury to or death of 1 person in any 1 accident . . . .” Mich. Comp. Laws § 257.401(3) (2003) (“Subsection 3”). In effect, vicarious liability is imposed on an owner when the driver's negligence causes an accident in another state so long as the owner-driver relationship was entered into in Michigan. Sexton v. Ryder Truck Rental, Inc., 320 N.W.2d 843, 856 8 (Mich. 1982). At the time of Chappell’s accident, Michigan law provided that it was a misdemeanor for “an owner knowingly [to] permit to be operated, upon any highway, a vehicle required to be registered . . . unless there is attached to and displayed on the vehicle . . . a valid registration plate issued for the vehicle . . . .” Mich. Comp. Laws §§ 257.255(1), (2) (2001).2 2 The parties presented (and the District Court relied on) several legal arguments implicating the significance of this provision, all involving events that took place before Powell rented the vehicle. For reasons explained below, we need not reach these arguments. For the sake of completeness, however, we set out the pertinent pre-rental facts. Assuming that Budget followed its regular procedures, after the Xterra arrived in Romulus, Michigan (on or about January 30, 2002), a Budget fleet clerk obtained Michigan license plate NVQ532 and placed that plate on one of the Xterra's seats. A “lot person” later removed the plate from the Xterra's seat and affixed it to the vehicle. After placing the plate in the Xterra, the fleet clerk wrote license plate number “NVQ532” at the top of the vehicle's certificate of origin and took the certificate to the office of Michigan's Secretary of State. Someone unknown crossed out the fleet clerk's initial reference to “NVQ532” and wrote “PHS756” next to it. Michigan license plate NVQ532 was registered for use with a 2001 Ford with Vehicle Identification Number 9