In Landeros v. Torres (2012) 206 Ca.App.4th 398, the California Court of Appeal held that an unlicensed driver with no insurance of her own could be a permissive user under an automobile policy providing coverage to the vehicle owned by her father. The driver of the vehicle (Landeros) was a sixteen year old unlicensed driver. Landeros suffered serious and permanent brain damage after the vehicle she was driving was struck by a vehicle driven by Torres. Landeros was in a coma for several weeks and spent over nine months in a rehabilitation facility. Torres was at fault for the accident and admitted liability. At the time of the accident his blood alcohol content was .10. He was arrested, pled no contest to driving while intoxicated and was sentenced to 32 months in prison. This matter went to trial on damages only and the jury awarded Landeros $31,656,208 which included $21 million in non-economic damages.
In Landeros, the insurance carrier attempted to assert Proposition 213 as a defense against the purported insured who was unlicensed and had used her father’s car. The carrier was attempting to deny coverage under the permissive user provision of the policy.
Can an unlicensed driver recover non-economic damages? What about California Prop 213?
As a reminder, Prop. 213 should always be considered in any claim involving an automobile.
Here is a basic review:
- Prop. 213 prevents recovery of non-economic damages if the driver was convicted of driving under the influence of alcohol or drugs (unless you’re at fault, insured was also driving and was convicted of driving under the influence of alcohol or drugs);
- Prop 213 prevents recovery of non-economic damages if the claimant owned the vehicle and it was not insured or was the operator of the vehicle (the claim in this case) and the vehicle was not covered by insurance;
- Prop 213 does not apply in a wrongful death case unless an heir (and only to that heir) was the owner or operator of the vehicle (and uninsured) but does apply if the driver is specifically excluded under an automobile liability policy by name;
- The statute also applies to claims arising out “use” of the vehicle, which includes stopping, parking, and exiting the vehicle, or the claim that a roadway condition was a cause of the accident;
- Punitive damages are recoverable regardless of whether a claimant would be barred from recovery of non-economic damages.
It is important to consider these requirements when settling claims brought against your insured by drivers without liability insurance or those driving under the influence of alcohol or drugs because they are forbidden from obtaining non-economic damages (i.e. pain and suffering).
In Landeros, the Court noted that the insurance policy did not have a licensure requirement as part of the definition of permissive user. The Court questioned whether one would even be valid. It was undisputed that Landeros was given permission to use the vehicle at the time of the accident. The insurance policy did not contain an exclusion that would eliminate coverage for unlicensed drivers. The Court concluded that there is no policy provision that would relieve the insurer from providing liability coverage for an accident where Landeros negligently operated the vehicle. There are a long line of cases that establish that California has a strong public policy that requires insurance policies to provide coverage for permissive users, and any attempt to limit that coverage will be rejected.
In another case where the insurance policy provided that the permissive user must be “legally operating” the vehicle, the Court still found that coverage existed for an unlicensed driver. The Court liberally construed the term “legally operating” and applied the rule that exclusions in insurance policies must be strictly construed against the insurer.
It appears as though in California, the insurance policy must contain the express language that a permissive user must be a licensed driver and/or contain a specific exclusion for unlicensed drivers. Otherwise, as opined by the Court in Landeros, an unlicensed driver will be considered a permissive user and able to recover non-economic damages.
ABOUT THE AUTHOR: Kimberli C. Raines is senior counsel at Tyson & Mendes, LLP. She specializes in the defense of personal injury, wrongful death, insurance bad faith and general liability matters. Contact Kimberli at 858.263.4134 or email@example.com
Download Article Here: A 16 Year Old Unlicensed Driver Can Still Be Considered A Permissive User