Vicarious Liability and the Beneficial Ownership Exception to the Dangerous Instrumentality Doctrine

By Jacek Stramski

It’s 6:00PM. Do you know where the cars titled in your name are?
On April 10, the Florida Supreme Court issued an opinion addressing the beneficial ownership exception to the dangerous instrumentality doctrine, which provides an exception to the doctrine that a vehicle owner who permits another to use the vehicle may be liable for any harm caused by the negligent use of the vehicle. The opinion, issued in Christensen v. Bowen (SC12-2078), is available here. A discussion about oral arguments held in the case is available here.
In the opinion, the Court unanimously held that Robert Christensen, who purchased a vehicle for his wife while the two were involved in divorce proceedings, and who was listed on the title as a co-owner of the vehicle, could be held vicariously liable in a wrongful death action stemming from a fatal accident in which his ex-wife negligently struck and killed another while driving the vehicle. The Court held that vicarious liability under the dangerous instrumentality doctrine could apply even though the car was intended by Christensen to be used by his ex-wife, and even though Christensen had neither keys to the car nor access to the garage where the car was kept.
The Court began its analysis by noting that “[t]he underlying rationale of the [dangerous instrumentality] doctrine is that if a vehicle owner, who has control over the use of the vehicle, exercises his or her control by granting custody of the vehicle to another, the owner commits himself or herself to the judgment of that driver and accepts the potential liability for his or her torts.” (Op. at 5).
The Court recognized that there is a beneficial ownership exception to the dangerous instrumentality doctrine. The exception precludes vicarious liability when the titleholder lacks beneficial ownership of the vehicle. However, the Court held that the exception only applies in cases where equitable and legal rights of control have passed to another and the titleholder retains bare legal paper title. Such a situation might arise when a car is sold but title retained as security for the full payment of the purchase price, or where a common law purchase of a vehicle is effected but the title has not been updated to reflect the transfer.
In other words, “beneficial ownership is unrelated to physical access to a vehicle, past use of a vehicle, or intent to use or not use a vehicle. Rather, beneficial ownership arises from legal rights that allow an individual to exert some dominion and control over the use of the vehicle.” (Op. at 12). The Court added that for purposes of motor vehicle litigation, title determines ownership, and ownership reflected in a title can only be disproven by objective evidence of a “conditional sale or incomplete faulty transfer.” (Op. at 14).
Because Christensen did not present any evidence that he transferred his co-ownership interest in the vehicle, he retained the legal right (if not practical ability) to exert control over the vehicle. He therefore could not avail himself of the beneficial ownership exception to the dangerous instrumentality doctrine.