Updated August 2, 2021
During many accidents in New Jersey, the person who is driving the car is not the owner of the car. Many times people who were injured in accidents or suffered property damage have asked us whether the owner of the vehicle is responsible when someone else uses the car and causes an accident. The short answer is, “it depends.”
If someone uses your car and causes a collision, you are not automatically responsible. However, in New Jersey there is a rebuttable presumption that the driver is acting as the owner’s agent. And “agent” is basically a fancy word for a person who is working or doing an errand for another person (that other person is called the “master”). In any sort of agency relationship, if the agent was acting within the scope of the agency relationship then the master will be responsible for any injuries or damages caused by the agent. Therefore, the presumption is that the owner of a vehicle will be responsible for any damages caused by a person using the car.
But that doesn’t end the inquiry. As mentioned above, the presumption is rebuttable, which means that the owner of the vehicle can bring forth evidence showing that there really was no agency relationship or that the agent wasn’t acting within the scope of the agency relationship.
The classic example of the first case – that there never was an agency relationship – is the case where a person borrows someone else’s car for their own personal use. For example, if I borrow your car so that I can go to a store and buy things for myself then I am not your agent; I’m just borrowing your car. There is no agency because the owner of the car isn’t getting any benefit from lending out his car and didn’t ask the person to go to the store. So in such a case, the owner of the vehicle would not be responsible if there was a collision and people were hurt or cars were damaged.
The second type of situation – that the agent exceeded the scope of the agency relationship – is something that is a bit more complicated. And it was recently litigated in an Essex County case, which illustrates the concept nicely. In that case, the owner of the car asked her brother to take her car and go pick up her daughter. He agreed, but on his way he stopped at a liquor store, bought a bottle of scotch, drank enough of it to raise his blood alcohol to 4 times the legal limit, and then caused a crash. Clearly, the brother was acting as his sister’s agent when he got the keys to the car because he was doing an errand specifically at the request and for the benefit of the car owner. Had he caused an accident right away after borrowing it, the sister would clearly have been liable as well. However, the driver took a detour and got extremely drunk. The rule in New Jersey is that the agency relationship terminates when a driver deviates from the owner’s instructions and takes on an additional errand. In this case, the Court felt that going to the liquor store and drinking was an additional errand, and therefore the Court felt that the owner of the vehicle was not responsible.