Court Opinion

ID: 5788239
Source: CourtListenerOpinion
Date Created: 2022-01-12 18:04:35.722579+00
Date Added: 2024-06-11T08:41:55.626990
License: Public Domain

Benjamin, J.
(concurring in the result). The Hertz Corporation leased an automobile owned by it to Jean Riquier. The rental agreement limited the use of the hired automobile to certain purposes, which are not at issue here, and to certain drivers. The provision under consideration provides that under no circumstances is the vehicle to be used, operated or driven by any person other than the customer (the lessee) and “ (1) a member of the Customer’s immediate family; (2) Customer’s employer; [and] (3) an employee of Customer in the course of such employee’s regular and usual employment by Customer.”
It appears that Riquier permitted one Tonioli to drive the hired vehicle, in violation of the above-quoted portion of the driver restrictions. While Tonioli was driving the hired vehicle a collision occurred with a vehicle owned and operated by Louis La Perta and in which Agnes La Perta was a passenger.
¡Special Term found that the driver restrictions in the rental agreement, which were contained in the small print on the reverse side of the rental agreement, were not effective “ to void the insurance coverage which would otherwise have been applicable *111to the leased vehicle ” and for this reason “ Tonioli was not an uninsured motorist within the terms of the endorsement of * * * [La Perta’s] insurance policy ” (Matter of Allstate Ins. Co. [La Perta], 71 Misc 2d 754, 756). Accordingly, Special Term stayed the arbitration proceeding commenced by Agnes La Perta.
I agree that the order appealed from should be affirmed, but solely for the reason set forth in this concurring opinion. In my view the driver restrictions under consideration are void with respect to third parties, as against the public policy of this State, as expressed, in part, by section 388 of the Vehicle and Traffic Law, without regard to the size of the print of the restrictive provisions relied upon by the Hertz Corp.
Section 388 of the Vehicle and Traffic Law provides, in part, that “ every owner of a vehicle used or operated in this state shall be liable and responsible for death or injuries to person or property resulting from negligence in the use or operation of such vehicle, in the business of such owner or otherwise, by any person using or operating the same with the permission, express or implied, of such owner. ’ ’ There is no dispute that Biquier was entitled to use the rented vehicle. Nor is there any dispute that Tonioli was using the rented vehicle with the permission of Biquier. The issue thus presented is whether the chain of permissive use is broken by the restrictions upon the use of the vehicle contained in the rental agreement.
It is well settled that an owner in lending his car to another person may reasonably restrict the uses to which the car may be put (Arcara v. Moresse, 258 N. Y. 211, 214; Burmaster v. State of New York, 7 N Y 2d 65; Hinchey v. Sellers, 7 N Y 2d 287). The reasonableness of the restriction imposed is largely dependent upon the facts and circumstances of the particular ease. One fact of peculiar importance is whether the owner, or one standing in his stead, is in the business of leasing automobiles to the public (Cooperman v. Ferrentino, 37 A D 2d 474, 477-478). We have squarely held, and for good reason, that ‘ ‘ an operator of a car rental business, is not in the same position as an individual owner of an automobile who lends it to a relative or .friend for a specified purpose or limited to a described area ” (Cooperman v. Ferrentino, 37 A D 2d 474, 477, supra). “ Considerations of public policy will prevent the evasion of the statutory liability of a party leasing cars for profit through the attempted device of conditions on use which in truth run counter to the realities and disguise the transaction” (Cooperman v. Ferrentino, 37 A D 2d 474, 478, supra; see, also, Kalechman v. Brew Auto *112Rental, 38 A D 2d 974 [concurring opinion of Mr. Justice Shapiro] ; Furletti v. Hertz Corp., 36 A D 2d 973, 975-976 [dissenting opinion]; Barnes v. Shul Private Car Serv., 35 A D 2d 841). As Mr. Justice O’Gorman wrote at Special Term in the instant case (Matter of Allstate Ins. Co. [La Perta], 71 Misc 2d 754, 756, supra): “ In this case we are not dealing with the average owner of a motor vehicle, but we are instead dealing with a large corporation engaged in the business of daily leasing large numbers of motor vehicles which, while abroad on the highways, will necessarily become involved in a proportionate number of accidents. It is this element of size and frequency of leasing, when taken in conjunction with the probable conduct of the large number of drivers who will lease those vehicles, which creates a situation which differs substantially from the isolated transactions engaged in by an individual owner of a motor vehicle.”
With these principles in mind, the driver restriction relied upon by Hertz Corp. is clearly unreasonable and, in the context of section 388 of the Vehicle and Traffic Law, therefore void and unenforceable as against innocent third parties.
The rental agreement permits the lessee to grant permission to qualified licensed drivers who are, in addition, either (1) a member of the lessee’s immediate family (in which case the member must be 21 years of age or older), (2) the lessee’s employer or (3) the lessee’s employees employed “ in the course of such employee’s regular and usual employment.” Yet the rental agreement prohibits the lessee from granting permission to nonmembers of the above classes no matter how qualified they may be or under “ no circumstances ”. In each case, however, the driver is equally unknown to the lessor. From the point of view of third persons injured by a driver who is not in any of the enumerated classes, the restrictions are arbitrary and do not reflect the true realities of1 the situation — a simple automobile rental car used with the lessee’s permission. To permit insurance coverage as to innocent third parties to turn on such arbitrary distinctions for so commonplace an activity “ defies reality, [and] is a sort of alchemy which to me seems clearly unjust and unreasonable ” (Kalechman v. Drew Auto Rental, 38 A D 2d 974, 975, supra [concurring opinion of Mr. Justice Shapiro]).
Accordingly, I would hold the driver restrictions at bar per se void on the facts presented by this record. So viewed, Siquier had the authority to permit Tonioli to operate the rental car; and Tonioli was not, for this reason, an uninsured motorist as *113that term is understood in an uninsured motorist indorsement on an automobile liability policy.
Munder, Acting P. J., Latham and Christ, JJ., concur with Shapiro, J.; Benjamin, J., concurs in result, with a separate opinion.
Order of the Supreme Court, Westchester County, dated December 4, 1972, affirmed, with $20 costs and disbursements against respondent the Hertz Corp.