For car drivers in South Florida and around the country, occasional mechanical problems are an annoying, but expected fact of life. Fortunately, many auto insurance policies will cover a car rental in the event that your regular wheels are in the shop. A new ruling by the Florida Supreme Court explains the tricky legal issue of what happens when the insurance policy holder lets someone else drive a rental car and that someone else gets in a car accident.

In the combined cases of Chandler v. Geico Indemnity Co. and Steele v. Geico Indemnity Co., the court reviewed a ruling by the state’s First District Court of Appeal (DCA) regarding an insurer’s duty to defend and indemnify its insured. Specifically, the DCA ruled in Geico Indemnity Co. v. Shazier that an insurer was not required to defend and indemnify a policy holder in relation to an accident that occurred while an unauthorized third party was driving the holder’s rental car.

The Shazier case involved Kutasha Shazier who owned a car insured by Geico. When the car underwent repair for a transmission problem, Shazier rented another vehicle from Avis Rent-A-Car. The rental contract prohibited anyone not authorized by Avis from driving the car. Shazier’s Geico policy covered not only her primary car, but also a “temporary substitute”: a vehicle not owned by Shazier, but temporarily used with the permission of the owner.

Shazier lent the car to a friend who then allowed the car to be driven by a third person, Tercina Jordan, who subsequently crashed it into a tree, killing a passenger. The passenger’s family sued Shazier and Geico intervened, seeking a declaratory judgment indicating that Geico is not required to defend or indemnify Shazier because Avis had not given Jordan express permission to drive the rental car. Although a trial court ruled against Geico, the DCA reversed the decision on appeal, finding that the rental car did not constitute a “temporary substitute” because Avis had not authorized Jordan to use the car.

The petitioners in the supreme court case sought review of the DCA’s ruling, arguing that it conflicts with the court’s decisions in other similar cases. The court agreed, stating that “the constriction of the meaning of consent in Shazier expressly and directly conflicts” with previous rulings in which the court applied a broad definition of an owner’s consent to use a vehicle that “is not limited by the identity of the operator.” In other words, according to the court, “consent is simply consent to the use or operation of such an instrumentality beyond the owner’s immediate control.” In this case, Avis consented to use of the rental car beyond Avis’ immediate control. As a result, the car qualified as a “temporary substitute” and Geico was obligated to defend the suit against Shazier.

If you or a loved one was recently injured in an auto accident, contact the South Florida personal injury attorneys at Anidjar & Levine for a free initial consultation. Our experienced and diligent accident attorneys represent clients throughout the region, including in Coral Springs, Pompano Beach and Boca Raton. Call the firm’s Fort Lauderdale offices today at 800-747-3733.

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