Nat. Farmers Union Prop. & Casualty v. Maldonado

Filed 4/4/07 Nat. Farmers Union Prop. & Casualty v. Maldonado CA5

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIFTH APPELLATE DISTRICT

THE COURT^*

APPEAL from a judgment of the Superior Court of Tulare County. Lloyd L. Hicks, Judge.

English Lloyd & Armenta, Juan M. Armenta, for Defendant and Appellant.

Graham & Associates, Bruce N. Graham, for Plaintiff and Respondent.

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Appellant, Mireya Maldonado, appeals from a judgment finding her liable for damages from a motor vehicle accident. Although appellant had sold the car involved to her brother and he had sold it to a third party, she remained the owner of record because neither transaction was recorded with the Department of Motor Vehicles. Appellant contends the trial court erroneously found her liable under Vehicle Code section 17150^[1]because there was no evidence she extended permission to the culpable driver to operate the car. We disagree and will affirm.

FACTS AND PROCEDURAL HISTORY

Appellant was the registered owner of a 1994 Dodge vehicle. On April 29, 2003, appellant sold and delivered possession of the car to her brother, Benjamin Valle. Valle told appellant his girlfriend would be using the vehicle and it would be registered in her name. However, a short time later, Valle sold the car to Manuel Mendoza. Appellant was unaware of this sale and did not know Mendoza. Neither of the sales were recorded with the Department of Motor Vehicles (DMV).

Less than a month later, on May 22, 2003, Mendoza drove the Dodge negligently and collided with Patricia Liebelt, who was driving a tractor rig that was insured by respondent, National Farmers Union Property & Casualty Company (National). As a result of Mendozas negligence, Liebelt suffered damages and National paid her $29,735 in policy benefits. National, as subrogee, sued appellant and Mendoza for damages. The trial court held appellant liable under section 17150 and ordered judgment against her for the statutory amount of $20,000 ( 17151, subd. (a).)

DISCUSSION

Appellant contends it was error for the trial court to find owner liability under section 17150, because she extended no permission, express or implied, for Mendoza to drive the car. Specifically, the trial court misconstrued section 17150 by concluding that delivery of the vehicle without any restrictions as to its use the normal circumstances of a sale constitutes express permission under section 17150.

Standard of Review

To the extent the appeal raises an issue of statutory construction, we review the issue de novo. (Essayli v. Department of Motor Vehicles (2005) 131 Cal.App.4th 1251, 1255.) To the extent the appeal raises an issue of fact, we apply substantial evidence review. (Taylor v. Roseville Toyota, Inc. (2006) 138 Cal.App.4th 994, 1004.)

Vehicle Owners Liability

Section 17150 provides:

Every owner of a motor vehicle is liable and responsible for death or injury to person or property resulting from a negligent or wrongful act or omission in the operation of the motor vehicle by any person using or operating the same with the permission, express or implied, of the owner.

Ownership under section 17150 is not determined by the ordinary rules of ownership governing personal property. Rather, vehicle ownership liability is governed by the registration record and transfer procedures prescribed in the Vehicle Code. Under the Vehicle Code, there may be several vehicle owners simultaneously, all liable for a third partys injuries, even though no such owner possesses all of the normal incidents of ownership. (Durbin v. Fletcher (1985) 165 Cal.App.3d 334, 341.)

Section 17150 must be read in light of section 5602, which addresses the requirements for releasing ownership liability. Section 5602 provides that a registered vehicle owner is released from liability if she makes a bona fide sale or transfer of the vehicle, delivers possession and either: (a) makes proper endorsement and delivery of the certificate of ownership as provided in the code, or (b) delivers to the DMV prescribed notice or appropriate documents and fees for registration to the new owner.

The consequences for not complying with the formalities of section 5902 are based on sound public policy:

The purpose of the notice statutes is not to furnish a trap whereby some unwary individual may be held liable for the actions of another over whom he has no control. Rather, the purpose is to protect parties, to register transfers and sales of property, and to protect third [parties] injured by the operation of a vehicle by affording them ready information concerning those liable. (Durbin v. Fletcher, supra, 165 Cal.App.3d at pp. 347-348.)

Appellant stipulated she did not notify the DMV of her transfer to Valle until after the accident. And, there was no evidence she made proper endorsement and delivered the certificate of ownership before the collision. Therefore, she failed to satisfy the statutory requirements under section 5602 to obtain release of ownership liability for subsequent operation of the Dodge.

Liability under Section 17150

The trial court found that appellants unrestricted sale of the vehicle to Valle constituted express permission and implied permission arose by virtue of Valles subsequent transfer of the vehicle to Mendoza. The court relied on Uber v. Ohio Casualty Insurance Company (1967) 247 Cal.App.2d 611. Appellant submits the case is inapposite because Uber addressed omnibus coverage under Insurance Code section 11580, not the standard necessary to find express or implied permission under section 17150. Appellant ignores the fact that before the Uber court found coverage, the court concluded that each insured was an owner under section 17150. (Id. at p. 617.)

In Uber, prior to the accident, the car was transferred three times among different car dealerships, none of whom complied with the Vehicle Code registration and title transfer provisions. The driver at the time of the accident was using the car with the express permission of the third dealership. (Uber v. Ohio Casualty Insurance Company, supra, 247 Cal.App.2d at p. 614.) Uber held that the transferor/seller is deemed to continue to be an owner as to an injured third party, unless he complies with the prerequisites to avoid liability set forth in section 5602. Strict compliance with section 5602 is required before an owner may escape the liability imposed by section 17150 on account of an accident occurring before notice of the transfer is received by the [DMV]. (Id. at p. 616.) In holding all three dealerships liable, the court concluded that parties to a vehicle transfer, accompanied by a delivery of possession, contemplate its use not only by the immediate transferee but also by subsequent transferees and by permittees of all such transferees. [A] transferor who continues to be an owner for liability purposes because of his failure to comply with the pertinent provisions of the Vehicle Code, impliedly consents to the use of the automobile transferred by the immediate transferee, subsequent transferees and the permittees of all such transferees as a matter of law. (Id. at p. 617.)

Appellant contends the reasoning of Uber is limited to dealer-transferors. We are not persuaded. Both commercial dealerships and individual sellers can reasonably anticipate that after a vehicle is sold, it will be operated by transferees and their permittees, both known or unknown by the transferor. Sections 17150 and 5602 do not distinguish between dealerships and private individuals in imposing ownership liability.

Under the rule of Uber, the trial court correctly found that appellants unrestricted sale of the Dodge to Valle constituted express and implied permission to drive the car to Valle and to subsequent transferees and permittees, including Mendoza. The fact appellant neither knew Mendoza nor of the sale to Mendoza was of no more consequence here than in Uber. Knowledge merely serves to distinguish whether permission was express or implied. (See Burford v. Huesby (1939) 35 Cal.App.2d 643, 644 [express necessarily implies previous knowledge of the intended use; implied means without previous knowledge, but under circumstances from which consent to use the car is necessarily implied].)

Appellant cites to Marquez v. Enterprise Rent-A-Car (1997) 53 Cal.App.4th 319, 322 to support her argument that implied permission must be affirmatively shown. The court in Marquez explained that permission cannot be left to speculation or assumption, but must be affirmatively shown by the plaintiff. (Ibid.) Marquez is distinct because the case did not involve a vehicle transfer or implication of section 5602. Rather, the issue in Marquez was whether the business owner extended permission for the culpable driver to operate its car, despite express terms in a rental agreement limiting permission to the specified permittee.

Likewise, appellants reliance on Taylor v. Roseville Toyota, Inc., supra, 138 Cal.App.4th 994 and Elkinton v. Cal. State Auto. Assn. (1959) 173 Cal.App.2d 338 ignores the necessary application of section 5602 to this case. Rather than address sections 17150 and 5602 in conjunction with inchoate ownership transfers, those cases dealt with particular employer-employee and parent-child relationships and whether there was sufficient evidence of implied permission within those contexts.

Appellant failed to address the relationship of 17150 and 5602 in her briefs. Contrary to her claim that the trial courts interpretation made the express or implied permission language of section 17150 superfluous, her interpretation would make section 5602 a nullity. Ubers conclusion flows from a recognition that both statutes must be read together when the situation involves a third party injured by a car that has been transferred from the registered owner to another without complying with section 5602. The cases appellant cites for the proposition that evidence of permission must be substantial involve situations in which there is one clear owner and the issue is whether the user at the time of the accident had his or her permission to use the car.

CONCLUSION

The trial court properly held appellant liable for the motor vehicle accident under section 17150 because appellant was the registered owner at the time of the accident and failed to comply with section 5602.

DISPOSITION

The judgment is affirmed.

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^*Before Vartabedian, Acting P.J., Wiseman, J., and Kane, J.

^[1] All further references are to the Vehicle Code, unless otherwise indicated.