TORTS – Dealer liability for accidents during test drive of car: Timothy Morgan v. Candria Scott and James E. Scott, Jr. (SC 5/21/2009)

Timothy Morgan v. Candria Scott and James E. Scott, Jr.
2006-SC-000693-DG May 21, 2009

2006-SC-000701-DG May 21, 2009

2007-SC-000282-DG May 21, 2009

Opinion of the Court; all sitting.

Morgan went to an automobile dealership where, contrary to its policy, he test drove a truck without being accompanied by a salesperson. Morgan lost control of the truck and struck the vehicle driven by Scott. Scott and her husband sued Morgan and the dealership, claiming Morgan had driven negligently and that the dealership had breached its duty to ensure Morgan’s safe operation of the vehicle. The jury returned a verdict in Scott’s favor, awarding approximately $4,000,000 and apportioning fault equally between Morgan and the dealership. The Court of Appeals affirmed the verdict against Morgan, but reversed as to the dealership. Further, the Court of Appeals held that 8 Morgan was liable for 100% of the damages awarded by the jury. T

he Supreme Court affirmed the Court of Appeals, holding that the dealership satisfied its duty of care when it confirmed Morgan was duly licensed to drive and not otherwise obviously impaired.

The Court further held that the dealership did not assume a duty towards the public by establishing its policy that test drivers must be accompanied by a salesperson since a) Scott could not have relied upon the policy since the evidence showed she was unaware of its existence; and b) the dealership’s failure to observe its policy did not increase the risk of harm to Scott. The Court also rejected Morgan’s argument that he should bear only 50% of the liability for the damages verdict, holding that KRS 411.182(1) requires apportionment only when “more than one party” is at fault. Wrote the court: “We can find nothing fundamentally unfair about assigning one hundred percent of the fault for an injury to the only party that breached a duty and caused the injury.”

Justice Abramson (joined by Justice Cunningham) concurred in part, but dissented from the portion of the opinion holding Morgan 100% liable for the damages—asserting the case should be remanded for a new trial solely on the issue of damages caused by Morgan. Justice Noble also dissented in part, contending that whether or not the dealership assumed a duty and if failure to follow its policy increased the risk of harm to Scott were questions for the jury. The Chief Justice concurred in result only.