Insurance Covers Mom as Passenger

Adams v. Presnell, 286 Or App 390 (2017)

Here’s a case in which the Oregon Court of Appeals applies common sense to liability for injury to an Oregonian.

The Facts

Mom was riding shotgun when her 16 year-old son, driving on a learner’s permit, lost control of the car and hit a utility pole, causing Mom serious injury. Mom brought a legal action for negligence against the family motor vehicle liability insurance policy, which covered her son, as a member of the family.

“Family Purpose Doctrine”

The insurer tried to avoid compensating Mom for her injuries by arguing the “family purpose doctrine.” That legal doctrine says the owner of a car may be liable for injury caused by the negligent driving of a family member, as long as the car is being used for family purposes. The insurer’s argument was that Mom was liable for injury caused by son’s negligence under the “family purpose doctrine,” so that she was liable for her own injuries and should not receive compensation for her medical expenses or pain and suffering. The insurer argued that Mom was, in fact, suing herself.

Court rejects insurer’s argument

A trial court judge in Salem agreed with the insurer and dismissed the case. On appeal, the Oregon Court of Appeals reversed that decision and sent the case back for trial. The Court explained that the “family purpose doctrine” is a rule of law designed to protect third parties who are not family members, when someone in the family drives the family car with permission of the owners (usually the parents) and negligently causes injury to that third party. The driver is treated as the “agent” of the owner or “principal,” and principals are generally liable for injury caused by their agents, when acting on their behalf. (For example, an employer is a principal, and her employees are agents while they are on the job.)

The law of “agency” is designed to protect members of the public against the negligent acts of agents such as employees by making sure that the principals (usually employers) of those agents are financially responsible for their negligence. The Court pointed out, however, that in Oregon, a principal is not liable for injury to herself that is caused by the negligence of her agent. If that is true for principals and agents generally, it is also true for parents whose children cause injury by negligent driving. The parents and their insurers are liable to pay for injury the children cause to third parties outside the family, but that responsibility to others does not keep the parent from recovering compensation for injury caused to her by her child’s negligent driving.