Uber and Lyft Car Accidents

There are now over 5,000 Uber drivers operating in Georgia and on July 1, 2015, the Georgia Legislature passed new laws regulating Uber and its ilk.

HB 190 and HB 225 dealt with the question of how to treat these services mostly through background checks and insurance. 


HB 190 says that when a driver is "off the app", that is not accepting fares, their own personal insurance operates along with Georgia minimum coverages.

There are two other key time periods regulated:

 (A) The period of time a driver is logged on to the transportation network company's digital network and available to accept a ride request until the driver is logged off, except for that time period described in subparagraph (B) of this paragraph;

"During the time period defined in subparagraph (a)(5)(A) of this Code section, provides a minimum of $100,000.00 for bodily injuries to or death of all persons in any one accident with a maximum of $50,000.00 for bodily injuries to or death of one person and $50,000.00 for loss of or damage to property of others, excluding cargo, in any one accident..."

(B) The period of time a driver accepts a ride request on the transportation network company's digital network until the driver completes the transaction or the ride is complete, whichever is later.

(3) During the time period defined in subparagraph (a)(5)(B) of this Code section, 50 provides a minimum of $1 million for death, personal injury, and property damage per 51 occurrence and provides uninsured and underinsured motorist coverage of at least $1 52 million per incident.

So there you have it. If you are an Uber passenger injured in a car accident, there is $1,000,000 in liability coverage. If you are hit by an Uber car that is open for business but not on a call, there is $100,000 in liability insurance. 

Uber has been sued in California for the wrongful death of a six year old run down by one of their drivers and sadly it won't be long before there are Uber and Lyft drivers involved in serious crashes here as their numbers increase on the road. I am a frequent Uber and UberX user and have tried out Lyft a number of times so I will start out by saying that I think these services are fantastically convenient. We even managed to talk an UberX driver into driving us from San Francisco to Napa Valley for a dinner at French Laundry. What cabbie would do that? The utility of these services is undeniable. What is hotly debated is the legal liability Uber and other services face for car accidents involving affiliated drivers.

There are a few situations where liability for car accidents with Uber arise.

Situation1: Injury to the Uber passenger customer caused by negligent driving by the Uber driver.

Situation 2: Injury to a third party by an Uber driver with no passenger but available "on call" through the app.

Situation 3: Injury to a third party by an Uber driver with a passenger telling the driver where to turn etc.

At the outset you should know that Uber goes to great pains to state that they are not a transportation company and that they only facilitate communication between demand and supply of transportation.

Here is Uber's legal description from their own site.

"For the avoidance of doubt: Uber itself does not provide transportation services, and Uber is not a transportation carrier. It is up to the Transportation Provider to offer transportation services, which may be requested through the use of the Application and/or the Service. Uber only acts as intermediary between you and the Transportation Provider. The provision of the transportation services by the Transportation Provider to you is therefore subject to the agreement (to be) entered into between you and the Transportation Provider. Uber shall never be a party to such agreement."

Later in the agreement, we find this:

"The quality of the transportation services requested through the use of the Application or the Service is entirely the responsibility of the Transportation Provider who ultimately provides such transportation services to you. Uber under no circumstance accepts liability in connection with and/or arising from the transportation services provided by the Transportation Provider or any acts, action, behaviour, conduct, and/or negligence on the part of the Transportation Provider. Any complaints about the transportation services provided by the Transportation Provider should therefore be submitted to the Transportation Provider."

This is where the problems begin. Remember that Uber has a rating system it maintains with other rider's rating of certain drivers. The drivers are also rating the passengers. And yet, it says that complaints should only go to the drivers.

The larger issue is that Uber is selling a brand and a quality level. Black car services have been around forever with the idea that these are professional drivers with nicer cars. Uber legally claims to only be a communications network but it is marketing and operating as a unified brand with a consistent quality level. It gives the impression to the customer that the driver is "uber-qualified" (sorry I cannot resist a good pun.)  

In fairness, let us admit that the liability situation with cab drivers in Atlanta is pretty horrible. Cab drivers are only required to have $25,000 in liability insurance and no uninsured motorist insurance. The cabs are of shoddy quality and many of the drivers have no idea where they are going. Uber is a vast improvement.

For Uber, the drivers in Georgia usually have $1,000,000 liability policies as required by the State. What is more unclear is the situation with UberX. These are amateur drivers of varying quality and experience. UberX states that they are training the drivers and screening them with a background check. It is unclear if that means a criminal background check or driving history. There is some data saying that UberX drivers are covered by a commercial policy put in place by Uber. We have to hope so because regular personal insurance policies do not cover crashes where the driver is driving for hire. Drivers remember that. Driving for hire voids personal insurance coverage on the car and for injuries!

Situation 1:
So the Uber driver should have liability coverage of his own as a professional driver. We think Uber is providing the UberX drivers with liability coverage. If not, there is a huge problem on the horizon as the UberX personal driver's insurance will not apply. If the coverage is there, this is an improvement over cab drivers and their lousy insurance rates.

Can the injured passenger sue Uber as well arguing that Uber makes the passenger think the driver is of a certain quality? What if there is an assault by a driver and Uber missed a criminal record on the driver background check?

Look at the Restatement of Torts 324:

    “One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of the other’s person or things, is subject to liability to the other for physical harm resulting from his failure to exercise reasonable care to perform his undertaking, if:

    (a) His failure to exercise such care increases the risk of such harm, or

    (b) The harm is suffered because of the other’s reliance upon the undertaking”

    Restatement (Second) of Torts § 323, at 135 (1965).

So if the passenger is relying on the fact that Uber represents that it has safe or non criminal driver and Uber shanks it, can the passenger sue for the breach of the 324 duty? Possibly, yes. This theory has been used to assess liability against freight brokers in the trucking industry.

Situation 2:
This gets a little dodgy. If the driver has to be glancing down to review an Uber car request then the driver can get distracted and have a crash. Uber takes the position that the drivers are all independent contractors and it is not liable for their actions. In Georgia, the analysis is based on "time, manner and method." Is there sufficient control by Uber of the drivers such that they become the agent of Uber? Probably not because Uber drivers can refuse any fare. Does the use of the electronic cell phone dispatch create some type of liability? I don't see a way yet. Definitely on the driver, but not Uber.

Keep in mind the fact that most cab companies get out of liability on summary judgment because of the independent contractor defense in Georgia.

Situation 3
If you as an Uber passenger instruct a driver to "turn here" and the driver hits someone, you might share in the liability as the driver is acting as your agent. Unlikely it would get to that but the possibility is there.

These issues are on the forefront now and it will be interesting to watch how the liability scenarios unfold.

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