CHARLESTON – Enterprise Rent A Car sold Empire Fire and Marine liability insurance to a customer who elected not to cover any other driver, but Enterprise and Empire wound up on the hook for injuries he suffered while someone else drove.
Now, the West Virginia Supreme Court of Appeals must decide whether to take Enterprise and Empire off the hook.
Enterprise and Empire seek to overturn Kanawha Circuit Judge Jennifer Bailey Walker, who last year granted coverage to Jason Lin.
"If he allows another individual to drive the motor vehicle with his permission, coverage should be provided," Walker wrote.
In 2006, Lin and other Salem International University students leased a car at Enterprise in Clarksburg for a trip.
Lin bought $1 million in supplemental liability coverage from Empire, and he checked a line declaring the policy covered no other driver.
On the trip he grew tired and allowed passenger Shin Yi Lin, no relation, to drive.
She lost control, an accident happened, and Jason Lin suffered a serious head injury.
He claimed coverage under the Empire policy, and Empire denied it.
He sued Enterprise and Empire, and Walker ruled in his favor.
She relied on an omnibus statute providing that every automobile liability policy must cover the named insured and any other person with express or implied consent to drive.
She wrote that "the Legislature has demonstrated a clear intent to afford coverage to any person using a motor vehicle with the owner's permission as a means of giving greater protection to those who are involved in automobile accidents."
She wrote, "Even if you assume that Jason Lin was not a named insured for purposes of the insurance policy, he would constitute a custodian of the vehicle at issue so as to fall within the parameters of the omnibus statute."
She wrote that Lin never saw the policy and rejected Enterprise's view that the rental contract he signed set forth the terms and conditions.
She denied the exclusion because it wasn't conspicuous, plain and clear. Under state law, she wrote, any exclusion must specifically name the excluded driver.
She wrote that Lin incurred about $300,000 in medical expenses.
Enterprise appealed, and the Supreme Court heard oral argument on Sept. 9.
For Enterprise, Erica Baumgras of Charleston said the rental agreement contained a summary of the policy.
Chief Justice Brent Benjamin asked if Lin could give permission to another driver, and Baumgras said no.
Justice Menis Ketchum asked if it would have cost more to insure other drivers, and Baumgras said she didn't know.
For Lin, William Tiano of Charleston said, "He wasn't provided a copy of the exclusion."
Benjamin said, "He was arguably on notice."
Ketchum said, "He checked it off and signed it, that he didn't want to have anybody else covered."
Justice Thomas McHugh said, "If he had been driving, the liability wouldn't have protected him?"
Tiano said, "It would not cover him."
Justice Margaret Workman asked if Enterprise would be okay if the policy had specifically excluded other drivers, and Tiano said yes.
Workman said, "That would prevent them from ever renting a car to anyone. They can't name everybody in the world."
Benjamin asked if his argument would be the same if Lin allowed an intoxicated person to drive, and Tiano said yes.
Benjamin said, "You can't exclude anybody under your argument."
He said, "Pretty much, he's insured no matter what."
Baumgras said the exclusions were clear and conspicuous and the average person could understand the agreement.
Ketchum said, "When you're hurrying you don't have time to read this stuff."
He asked, "Do you think he got what he thought he was buying?"
Baumgras said, "I'm not in a position to answer."