Many people are unaware that, under Florida law, a motor vehicle is considered a dangerous instrumentality and an owner of a vehicle who allows someone else to use it has a legal obligation to insure that the vehicle is safely operated. If the person borrowing the vehicle damages property or causes personal injury, the owner is as considered as liable as the operator.
This legal doctrine can cause serious issues for parents who have teenage drivers that are using their cars. If the child operate the car negligently and causes an accident, the parent can be held liable as the owner. An easy solution is to title the vehicle solely in the name of the child. However, many parents are understandably hesitant to put cars in their children’s names, especially if it is their personal vehicle, or they provided the funding for the vehicle’s acquisition. These concerns can leave parents with few options regarding how to limit their liability in the event that their child causes an accident, with a vehicle they own, which leads to a judgment in excess of insurance coverage.
Concerned parents may wish to speak with a Florida trust attorney about the option of placing the car their child operates into a Florida vehicle trust. These specially designed trusts hold legal title to the vehicle, while still giving the parent the power to exercise control over it. This means that if the child gets into an accident, the parent and their personal assets, should not also be dragged into the dispute, since the trust owns the vehicle.
Florida vehicle trusts are not intended to eliminate the need for adequate insurance. However, they can be effective at limiting any excess liability for accidents which lead to judgments that are in excess of insurance coverage. If you have a question about Florida vehicle owner liability or are interested in establishing a Florida vehicle trust, contact a Florida estate planning attorney who can assist you with you inquiries.