Ride-Hailing Service Not Liable for Accident Caused by Driver

By Joanne Deschenaux June 23, 2020
Lyft car

Lyft, an app-based ride-hailing company, could not be held liable for an accident caused by one of its drivers because the driver was not acting within the scope of his employment at the time of the accident, a California appeals court ruled.

When he began working for Lyft, the driver used his own car. Subsequently, however, he began driving a car that he rented from a car-rental agency through Lyft's express driver program. To be eligible for this program, he had to drive at least 20 hours a week for Lyft and could not use the car to work for other rideshare companies. He could use the rental car for personal use, and the rental included unlimited mileage.

Lyft automatically deducted payments for the rental from the driver's weekly earnings and charged any outstanding balance to his credit card. Lyft also provided a bonus that covered some or all of the rental cost if drivers met certain ride requirements.

The driver used his rental car for both personal driving and for Lyft. He sometimes qualified for bonuses and, when he did not, he paid for the rental car.

On the day of the accident, the driver used his rental vehicle to get to a gaming conference in San Francisco. While driving home, his car collided with two vehicles, injuring both of the other drivers. The police report identified the Lyft driver as the responsible party, noting that he was driving at an unsafe speed and using by his cell phone shortly before the accident.

Both of the injured individuals sued the driver and Lyft. Lyft filed motions to dismiss the actions before trial, arguing that the driver was not working for Lyft on the day of the accident and that renting a vehicle from a car rental agency through Lyft's program did not mean that the company would be liable when the driver used the vehicle for his personal travel.

Respondeat Superior

In California, people who are injured in accidents caused by workers who are acting within the scope and course of their employment may recover damages from the employers under a legal doctrine called respondeat superior. Under this principle, employers are liable for the negligent actions of their employees when they are working but generally not when they are off-the-clock.

The appellate court analyzed whether the driver was acting within the scope and course of his employment when he caused the accident, using two different tests taken from a previous California court decision.

Under the first test, an employer is liable when the employee was acting with the employer's permission, and the employer received some benefit from the employee's actions.

Under the second test, an employer is liable when the employee's actions were required by or incident to the job or when the employer could have reasonably foreseen the employee's negligent conduct.

The court also noted that, under the "coming and going" rule, employers are generally not liable for the negligent actions of employees when they are commuting to or from their jobs. An exception may exist, however, when an employee is given the use of a company vehicle.

The court found that Lyft did not require its drivers to use rental vehicles. Instead, Lyft drivers could choose to use rental vehicles or their approved personal vehicles and could switch between them. The court also found that the driver's going to and from the gaming conference in the rental vehicle was not incident to his duties as a Lyft driver. The court found that the driver's actions in causing the accident were a substantial deviation from his duties as a Lyft driver and that Lyft could not be found liable under respondeat superior.

The court affirmed the trial court's dismissal of the actions.

Marez v. Lyft Inc., Calif. Ct. App., No. A156761 (April 30, 2020).

Professional Pointer: Courts have found an employer liable for injuries caused by an employee driving a company-provided vehicle even when the employee was not working at the time of the accident. However, in those cases, the court found either some connection to the employee's job duties or some benefit that accrued to the employer from the employee's personal use of the car.

Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md. 



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