The popularity of transportation networks such as Uber and Lyft has increased vehicle purchase demand by their contracted drivers. These services come with strict vehicle ownership requirements for their drivers, which often motivates a new or used vehicle purchase.
Uber and Lyft are just two examples where consumers are using their personal vehicles in a contracted employment capacity, a trend which is replicated in several industries, from courier services to food delivery. Just as a fleet manager would, these professional drivers scrutinize their vehicles for fuel efficiency, reliability and safety, among other attributes.
Many manufacturers already have agreements in place with Uber and Lyft to provide special pricing to prospective buyers. In addition, some dealers actively pursue these deals through their own in-house sales incentives. Since these drivers are merely contractors, these vehicles are not owned by Uber and Lyft, prompting an interesting question: If, while driving an Uber or Lyft passenger, a driver behind the wheel of a vehicle with an open recall gets in an accident that causes death or injury to the passenger, who is liable for the related damages?
As vehicles are considered property, the insurance company of the at-fault driver is liable for any damage. However, as it relates to a driver of a vehicle with an open recall, what if one of their passengers is seriously injured or killed in an accident? There are a growing number of personal injury attorneys who will argue that the driver of that recalled vehicle is liable, regardless of who caused the accident.
Personal injury lawyers are quick to take up these types of cases and typically target those with the deepest pockets. It’s a pretty solid bet that the Uber or Lyft driver’s pockets are not as deep as the service they are driving for. These drivers are independent contractors, which makes it convenient for Uber or Lyft to assign vehicle safety as part of the driver’s responsibility. It is up to the driver to keep their vehicle serviced and in good operating condition – and that, of course, includes fixing any open recalls. However, as any ambitious personal injury attorney will attest to, for Uber, Lyft and any other organization where a vehicle is used as an integral component to business operations, the question of negligence complicates matters.
Despite the well-intentions of the driver, any open recall can be unresolved for many reasons. The driver may not be aware of the recall or, if they are, perhaps the parts are unavailable, as is the case with faulty Takata airbags. Shelving their vehicle for months awaiting a part is typically not economically feasible for most individuals, much less for drivers who use their vehicles to earn a living. If they can’t drive, they can’t make money. So where does this leave the unsuspecting passenger?
At the moment, vehicle history reports and open recall warnings aren’t part of Uber or Lyft’s app. When a consumer requests a vehicle via the app, how are they to know if the vehicle is safe enough to climb aboard? Short of asking the driver for proof, then scanning the VIN to check themselves, they wouldn’t have a clue about the risk they are taking. Most passengers probably wouldn’t give it a second thought.
However, with more than 63 million vehicles on the road today with open recalls, it seems almost inevitable that there will be a major accident involving a passenger in an Uber or Lyft vehicle that has an open recall. If that happens, a swarm of personal injury lawyers will come circling and Uber and/or Lyft will be named in that lawsuit. Does the legal concept of negligence appear to be a grasp of sorts? Let’s face it – in today’s litigious world, you could sue a ham sandwich, if you wanted to.
The legal concept of “negligence” is central to the argument a personal injury attorney might take in such a case. According the National Law Review, “negligence” is an act that can be described as actively doing something, or failing to do something, that others in the same position would find incorrect. This legal assertion has already been used in recall cases to sue dealerships which knew that there was a dangerous recall, but proceeded to sell the vehicle. The legal measure would simply be whether other dealerships would also have sold the vehicle. Given the ease of access to tools and data to identify a dangerous recall, Uber or Lyft would have a very hard time convincing a sympathetic jury that negligence was not at play.
An attorney might contend that Uber and Lyft are guilty of “gross negligence” – carelessness which is in reckless disregard for the safety or lives of others, and is so great it appears to be a conscious violation of other people’s rights to safety. It is more than simple inadvertence, but it is just shy of being intentionally evil. If gross negligence is found by judge or jury, it can result in the award of punitive damages on top of general and special damages. This same challenge is currently being used to sue dealerships, independent repair shops, lube shops, and any other automotive facility that could have simply run the VIN and checked for a recall. As the danger of recalls touch on an ever-expanding number of industries, so too will the legal liabilities.
What does all of this have to do with vehicle sales or dealership operations? As Uber and Lyft drivers increasingly realize that open recalls can place them in a perilous liability situation, or that their vehicle could be non-drivable for an extended period of time due to lack of available parts to fix the recall, drivers will be much more particular about the vehicle they purchase.
Checking your inventory for open recalls not only benefits contracted drivers, but also the average driver, who has their loved ones as passengers. Recalls matter more to consumers than most dealerships are willing to admit.
Don’t miss my session: On the Front Lines of the Consumer Recall Process at the 22nd Digital Dealer Conference & Expo. You’ll learn how to protect existing customers, win back lost customers, and find new ones with comprehensive recall management.
Author: Chris Miller
Chris Miller is President of Recall Masters, a leading provider of automotive recall news, data, training, and communications. Privately held and based in the San Francisco Bay area, the company is dedicated to helping automakers and their dealers expedite the repair of recalled vehicles and make the roadways safer for everyone. Christopher has more than 17 years of experience building software to automate marketing communications. He has worked with marquee brands including HSBC/Household Automotive, Washington Mutual, Residential Pacific Mortgage, ServiceMagic, Monumental Life Insurance, Mercedes Benz USA, BMW/Mini North America, Volvo North America, JP Morgan Chase, Wells Fargo, Moxy Solutions, and Costco Automotive Group.