Why would someone sue my company and not the specific driver that hit them in an auto accident? 40 Answers as of November 05, 2012

I own a very small company than employees drivers. One of our driver's, two years ago, tapped the back of a car. The lady got out and said she was fine, and there were no damages to either vehicle, we took pics. Police report was filled out, but police office asked the lady 3 times if she was ok, and on the third time, she said her neck felt stiff. Two years later, we were served with a lawsuit before the statue of limitations ran out. The action is against my company, an llc, and not the driver. My insurance company says not to worry, but I've never been sued before, and if we lost and it went above my $25,000 coverage, I don't have the money to pay. Should I be worried if there was no damage to the car, and why is my company being sued and not the driver? It was the driver's negligence.

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The Lucky Law Firm, PLC
The Lucky Law Firm, PLC | Robert Morrison Lucky
Typically, if the driver was in the course and scope of his employment, then the company also becomes responsible under a legal principle. Stay in contact with your insurance company and encourage it to settle rather than go to trial where there is a chance of an excess judgment.
Answer Applies to: Louisiana
Replied: 11/5/2012
The Law Firm of Reed & Mansfield
The Law Firm of Reed & Mansfield | Jonathan C. Reed
If the driver was acting within the scope of his employment his corporate employer is liable. The Plaintiff's lawyer probably sued the corporation because it was easier to locate and serve.

There is an extra filing for each defendant in state court so it was easier to go with the sure defendant. You should consider having a larger insurance policy.

It seems very unlikely from what you have written that the insurance company will not be able to settle this claim within the policy limits.
Answer Applies to: Nevada
Replied: 8/23/2012
David F. Stoddard
David F. Stoddard | David F. Stoddard
An employer is responsible for the negligent acts of its employees committed in the course of employment (a legal doctrine called Respondiat Superior). The case sounds as if it will settle within the policy limits. You may want to consider raising your policy limits in the future and/or purchasing general business liability insurance (if you already have the latter, it might provide additional coverage for this accident.
Answer Applies to: South Carolina
Replied: 8/20/2012
Graves Law Firm
Graves Law Firm | Steve Graves
Your company was sued because it is liable for the acts of its agents and servants performed within the line and scope of their employment. It's called respondeat superior or vicarious liability. The plaintiff's lawyer probably figured out from the accident report that the company owned the vehicle and maintained the insurance policy on it, so that's who he sued. You're more likely to be struck by lightning than to have to pay out more than $25,000 for a Texas sore neck case. Quit worrying and get some sleep. It's your insurance company's problem; that's why you paid the premium. But first call your insurance agent and up your liability and uninsured/underinsured motorist coverage limits to at least half a million dollars. If the next accident should maim or kill somebody and you still have only $25,000 worth of insurance, your sleepless nights will be justified. A major accident can wipe out the business you've worked for or you, and in that case the added UM/UIM coverage can be a great blessing to your family. You'll be surprised at how little the extra protection costs. It's one of the best bargains in the insurance industry, and this is coming from a lawyer who has no affection for insurance companies. You might also want to get my book on the subject it's free.
Answer Applies to: Texas
Replied: 8/19/2012
Steven Harrell, Attorney at Law | Waymon Steven Harrell
She can sue either the driver, or your company, or she can sue both the driver and the company. Your company insurer must defend this lawsuit, since this happened in the scope of the driver's employment.
Answer Applies to: Georgia
Replied: 8/15/2012
    Lapin Law Offices
    Lapin Law Offices | Jeffrey Lapin
    Initially, I would suggest discussing your questions and concerns with the attorney that your insurance company hired for your company to defend the lawsuit. Generally, a person who is injured by an employee, who was working at the time, has the right to sue the driver, the company or both. As the employer, a company is responsible for the negligence of your employees. This is called "vicarious liability." Although you do provide some information regarding the accident and the woman's statement, I cannot answer what her case might be worth. I would need a lot more information. People can be injured in accidents with little to no damage to the vehicles involved. In addition, pain stemming from an accident-injury may not start immediately after an accident. Whether the woman was injured, and if so, to what extent, depends on what is contained within her medical records and reports and what her doctors say. If your insurance policy limits are insufficient to compensate the injured person, he or she can make efforts to collect from your company. If your employee was driving his or her own vehicle, the employee's insurance may also be applicable if your employee-driver is not sued.
    Answer Applies to: Nebraska
    Replied: 8/19/2012
    Kelaher Law Offices, P.A.
    Kelaher Law Offices, P.A. | James P Kelaher
    First, it is not unusual at all for someone not to feel they have been injured at the scene of the accident, but a day or two later find they have suffered what is called "soft tissue injury." As a matter of fact, that is quite common. In Florida, if you own a car, and that car is driven negligently and causes an accident, the owner of the car is just as responsible as the driver since Florida has a law which makes cars "dangerous instrumentalities" meaning the owner of the car is responsible. You're also "double dipped" because the person who caused the accident was also your employee, and we have another law called "respondeat superior" which means an employer is responsible for the negligence of the employee. That may be why they didn't bother to sue the individual driver/employee, but only the company. I almost always sue both the driver and the employer or the owner of the vehicle, but there can be reasons why the attorney chose not to sue the driver. Your insurance company is right not to worry because that is why you have insurance. If there was no property damage to either vehicle, and the person did not report any injuries at the scene, I would imagine your insurance coverage is sufficient to cover the injuries. I would write a letter to the insurance adjuster, however, and just say "please resolve this claim against my company within my policy limits if you have the ability to do so." That will protect you in the event there's an aberrant verdict which exceeds your policy limits.
    Answer Applies to: Florida
    Replied: 8/18/2012
    Gebler & Weiss, P.C. | Jerrie S. Weiss
    If the driver was in the course and scope of work for the company, the company is liable and so they always go for the one with the most insurance or the most money to pay.
    Answer Applies to: California
    Replied: 8/18/2012
    Law Office of Jared Altman
    Law Office of Jared Altman | Jared Altman
    They don't have to sue the driver. Let your insurance company handle it.
    Answer Applies to: New York
    Replied: 8/15/2012
    Law Office of Ronald Arthur Lowry
    Law Office of Ronald Arthur Lowry | Ronald Arthur Lowry
    It's called vicarious liability. The employer is responsible for the actions of the employee done in the course and scope of the employer's business. You are in business that has people driving for you and you cannot have total control of what goes on with them. You need more than $25,000 in liability coverage. This will likely happen again. To answer the specific question, lawyers sue the employer rather than the driver to avoid the jury sympathizing with the defendant driver.
    Answer Applies to: Georgia
    Replied: 8/18/2012
    John Russo | John Russo
    Because the driver worked for you and was on company time and business and in the end was negligent on your time not theirs. Your info does not state if your drivers use their own vehicles or the companies, but if they use their own don't worry the other party will go after your drivers insurance as well as yours.
    Answer Applies to: Rhode Island
    Replied: 8/18/2012
    Law Office of Gregory Crain | Gregory Crain
    You own the car.
    Answer Applies to: Arkansas
    Replied: 8/18/2012
    The Law Office of Harry E. Hudson, Jr.
    The Law Office of Harry E. Hudson, Jr. | Harry E. Hudson, Jr.
    Your carrier will provide counsel. Talk to that person who will have a lot more information about the case. I wouldn't get too excited.
    Answer Applies to: California
    Replied: 8/18/2012
    Stephens Gourley & Bywater | David A. Stephens
    I have not read the complaint, but you are probably being sued for either negligent entrustment or respondiat superior, meaning you hired the driver and while he is in your employ you are liable for his actions within the scope of his employment.
    Answer Applies to: Nevada
    Replied: 8/18/2012
    Gates' Law, PLLC | Thomas E. Gates
    Was the driver doing his job function and on company business at the time of the accident? If so, that is one of the reasons the company is being sued. he other is, the company resources are deeper than the employee's. Because you are an LLC, you personally are protected as long as you have complied with the Operating Agreement and State law. If necessary, you can close the business and form a new one.
    Answer Applies to: Washington
    Replied: 8/18/2012
    Mike Yeksavich | Mike Yeksavich
    The company is sued because of deep pockets. Turn the case over to your liability carrier and get more coverage.
    Answer Applies to: Oklahoma
    Replied: 8/18/2012
    Law Offices of Ronald A. Steinberg & Associates | Ronald A. Steinberg, BA, MA, JD
    The owner is responsible as well as the driver. The victim can sue either or both.
    Answer Applies to: Michigan
    Replied: 8/18/2012
    Durkin & Graham, P.C.
    Durkin & Graham, P.C. | Joan Durkin
    Negligent entrustment (you let him/her drive).
    Answer Applies to: Texas
    Replied: 8/18/2012
    Hynum Law Office, LLC
    Hynum Law Office, LLC | G. Wayne Hynum
    An employer is liable for the negligence of his employees that occur while they are engaged in activity for the employer. If the woman's injuries are as minor as you describe, it is doubtful the damages awarded would be more than your $25,000 insurance coverage. However, to be safe for the future, I suggest you increase your liability insurance coverage to an amount that adequately protects your business. $25,000 is the minimum auto liability coverage in Mississippi and most businesses have a lot more coverage than that for their vehicles. You should also carry Uninsured Motorist coverage in the same amount as your liability coverage.
    Answer Applies to: Mississippi
    Replied: 8/18/2012
    Frank Law Group, P.C.
    Frank Law Group, P.C. | David E. Frank
    Your company is liable if the accident occurred during the course and scope of the driver's employment. Your insurance company will likely get the matter settled well within the policy limits. But you should have a lot more liability coverage than $25,000. Talk to your insurance broker.
    Answer Applies to: California
    Replied: 8/18/2012
    Ricks & Associates | Kenneth R. Ricks
    The plaintiff has sued your company under the theory of Respondeat Superior, basically that the negligent driver (your employee) caused the accident while acting within the course and scope of his employment. As the driver's employer, and likely the owner of the vehicle, the company llc is liable for the acts of their agents/employees. As for whether or not a minor impact can cause significant injuries the answer is yes with the right circumstances (e.g. turned or otherwise awkward position, pre-existing delicate condition, etc.). As an aside, as a business that employs drivers you ought to have much higher insurance policy limits than $25,000.
    Answer Applies to: California
    Replied: 8/18/2012
    Law Offices of Tom Patton
    Law Offices of Tom Patton | Thomas C. Patton
    Your insurance company is very experienced in evaluating cases, so if they say not to worry, I wouldn't.
    Answer Applies to: Oregon
    Replied: 8/18/2012
    Law Offices of Steven D. Urban
    Law Offices of Steven D. Urban | Steven D. Urban
    She has the option to go after both of you. If the driver was acting within the course and scope of his employment, your company can be held liable. Notwithstanding, your company (and likely its insurance carrier) should be able to assert a claim for indemnity against the driver (which will likely trigger action from his carrier).
    Answer Applies to: Texas
    Replied: 8/18/2012
    John Ratkowitz
    John Ratkowitz | John Ratkowitz
    I can't tell you why the plaintiff did not sue the driver of the vehicle, I would have if I was filing suit. I would have named the company too though. It probably does not matter, because if you are not disputing that the employee was in the course of his employment when the accident happened, then you can be held liable for what your agent does. The plaintiff probably named the company because that is the named insured on the policy. Your insurance company has an obligation to resolve the case within your coverage limits if they are able to do that to avoid exposing you and your company to an excess judgment. It is hard to tell you whether you have something to worry about without knowing the facts of the case and the scope of the plaintiff's injuries. Your carrier will assign counsel to you, and you should be able to find out this information from him after he has had an opportunity to assess the file. Good luck.
    Answer Applies to: New Jersey
    Replied: 8/17/2012
    Dennis P. Mikko Attorney at Law | Dennis P. Mikko
    The owner of an automobile is always responsible for its actions. Since you are the owner and the person with insurance, you are the likely person to be sued. The driver probably does not have insurance and or anything of value to collect on if a judgment is awarded. If there was mininal damage and minimal injury, the person suing may not be able to show a threshold injury amounting to a serious impairment of a bodily function. If this is true, the suit should be dismissed. Your insurance company will provide you with a defense and has an obligation to you to resolve the matter within your policy limits. $25,000 in coverage is minimal. You may want to speak with your insurance agent about increasing your coverage.
    Answer Applies to: Michigan
    Replied: 8/15/2012
    Dressler & Peters, LLC | John Wagener
    The short answer is that sometimes it is easier to just sue the employer rather than try and track down the individual. Generally, employers are responsible for the negligent acts of their employees (or agents) performed within the scope of their employment. Although there are some exceptions, none seem to apply based on these facts. If the driver is a current employee, you may want to ask him/her if a claim was made against them, earlier, and resolved. You may also want to ask your insurance broker why you only have $25,000 in coverage when your LLC employs people who are driving, presumably, company vehicles.
    Answer Applies to: Illinois
    Replied: 8/17/2012
    DEAN T. JENNINGS, P.C.
    DEAN T. JENNINGS, P.C. | Dean T Jennings
    You are responsible for your driver's negligence if he is driving your truck. The claim may not be worth much and you limits may be enough. But cooperate with your insurance carrier and get with that adjuster right away. Your insurance company should hire a defense lawyer for you and that cost will be covered normally by your policy also.
    Answer Applies to: Iowa
    Replied: 8/18/2012
    Chalat Hatten Koupal & Banker PC
    Chalat Hatten Koupal & Banker PC | Linda Chalat
    The following excerpt explains the legal doctrine respondeat superior (copied from Nolo.com): Job-Related Accidents or Misconduct Under a legal doctrine sometimes referred to as "respondeat superior" (Latin for "Let the superior answer"), an employer is legally responsible for the actions of its employees. However, this rule applies only if the employee is acting within the course and scope of employment. In other words, the employer will generally be liable if the employee was doing his or her job, carrying out company business, or otherwise acting on the employer's behalf when the incident took place. The purpose of this rule is fairly simple: to hold employers responsible for the costs of doing business, including the costs of employee carelessness or misconduct. If the injury caused by the employee is simply one of the risks of the business, the employer will have to bear the responsibility.
    Answer Applies to: Colorado
    Replied: 8/17/2012
    Law Offices of Lee and Baghoomian, P.C.
    Law Offices of Lee and Baghoomian, P.C. | Joseph Lee
    Even if it is the driver's negligence, if the driver was doing company business on company time, your company could be held liable through the doctrine of respondeat superior. However, if the car has no/minimal damage, I would not be very worried about this, absent some very exceptional circumstances.
    Answer Applies to: California
    Replied: 8/15/2012
    Law Offices of David M. Blain
    Law Offices of David M. Blain | David Blain
    In California, and many other states, there is a legal rule called Respondeat Superior. This just means that an employer (you) is vicariously liable for the injuries caused by his employee (your driver) so long as the employee caused the injury within the course and scope of his employment, i.e. you hired the driver to drive for your company. Assuming what you say about the damages are true, then this is a very low valued case. Generally speaking, a person who is injured is legally entitled to recover compensatory damages. This means the injured party can recover for their medical bills (past and future), lost wages (past and future), repair costs to their property and any pain and suffering caused by the negligence of your driver. If the old lady's vehicle wasn't damaged, and she had very little, if any medical bills, and she didn't miss work then the value of her case should be very, very small. However, I do not know what her injuries are/were so I can't really say what the value of the case is. Your insurance company will provide you with a lawyer, but because you only have $25,000.00 in coverage you may want to consider hiring your own attorney to protect you beyond what the insurance company is covering.
    Answer Applies to: California
    Replied: 8/15/2012
    Timiney Law Firm
    Timiney Law Firm | Leigh Anne Timiney
    I am sorry this is happening to you. I know it can be frustrating and scary. When an employee is in the normal scope and course of their employment and they cause an accident or injury, it becomes the responsibility and liability of the employer. This is why you carry insurance and why your company has been named in the lawsuit. Try not to worry and let your insurance company handle this. If there was very little damage to the other vehicle and the injuries to the other driver appear to be minor, it doesn't sound like this would be a very large case and your insurance should be able to cover it for you. Further, if your company is incorporated or an LLC, you are not personally liable or responsible and cannot be sued or held personally liable.
    Answer Applies to: Arizona
    Replied: 8/15/2012
    Law Offices of David W. Hibbert
    Law Offices of David W. Hibbert | David W. Hibbert
    Relax. The auto insurance company is correct , and they'll defend your company. If there is also a general liability policy for your company , you should notify them as well. Your employee's collision , while on the job for you , in your company vehicle makes his/her negligence imputable to you.
    Answer Applies to: Georgia
    Replied: 8/15/2012
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    If you employee the driver and own the vehicle, then they can come after you. It is up to you to implead the driver and his insurance company. Normally they sue all persons. See if they did and if they did not talk to your carrier about doing it.
    Answer Applies to: New Jersey
    Replied: 8/15/2012
    Tannehill, Carmean & McKenzie, PLLC | Jay P. Carmean
    Under the legal theory of respondeat superior, an employer can be held liable for the actions of its employees. Your insurance should soon hire an attorney to defend this suit and that individual should be able to better answer your questions.
    Answer Applies to: Mississippi
    Replied: 8/15/2012
    Link & Smith, P.C.
    Link & Smith, P.C. | Houston Smith
    An employer is responsible for the negligent actions of an employee while the employee is operating within the course and scope of employment. The legal theory is called "respondeat superior" and you will likely see that phrase in the Complaint. I am surprised that you only carry the legal minimum of liability coverage ($25,000) for a vehicle that is used in commerce; and suggest that you carry $100,000 of both liability and UM coverage.
    Answer Applies to: Georgia
    Replied: 8/15/2012
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    Your hired driver is your company's agent, therefore they sue your company and/or the individual driver. Your insurance limits, in my estimation, are much too low, have them increased.
    Answer Applies to: Michigan
    Replied: 8/15/2012
    Downriver Injury and Auto Law | Michael Heilmann
    In Michigan, an employer is responsible for the negligent acts of its employee, so a prudent lawyer would always sue all responsible parties.
    Answer Applies to: Michigan
    Replied: 8/15/2012
    Ferguson & Ferguson
    Ferguson & Ferguson | Randy W. Ferguson
    Turn it over to your insurance company and don't worry. They will take care of the case. I doubt the case is worth anywhere near your policy limits.
    Answer Applies to: Alabama
    Replied: 8/15/2012
    Slotnick & Schwartz
    Slotnick & Schwartz | Leonard T. Schwartz
    The driver is your agent and employee which makes your company responsible. Let the insurance company worry about it.
    Answer Applies to: New Jersey
    Replied: 8/15/2012
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