Is the lessor of a car liable for injuries when lessee failed to maintain insurance on the car?
Full Question:
Answer:
In limited cases, the lessor of an automobile can be held vicariously liable for damages caused when a lessee fails to maintain the required liability insurance. An injured party will bring an action for damages against the driver of the vehicle and its owner. If the owner and the driver had a contractual agreement (lease) that said the driver was to maintain insurance to cover any losses and the driver breached that agreement, the owner (lessor) would have a contractual claim against the driver for any losses it was forced to pay for the lessee's negligence.
Missouri law requires that all motor vehicle owners maintain some type of motor vehicle liability insurance coverage. Motor vehicle owners are required to show proof of insurance when registering a vehicle or renewing their license plates. Owners must also keep proof of insurance in their vehicle(s). If a law enforcement officer asks for proof of insurance and the driver cannot show it, the officer may issue both the driver and the owner a ticket.
The statutes define "owner" as "a person who holds the legal title to a motor vehicle; or in the event a motor vehicle is the subject of an agreement for the conditional sale or lease thereof with the right of purchase upon performance of the conditions stated in the agreement and with an immediate right of possession vested in the conditional vendee or lessee, or in the event a mortgagor of a motor vehicle is entitled to possession thereof, then such conditional vendee or lessee or mortgagor".