Collector Car Event Planning and Risk Management, Part II (Spring 2004)

PART II: Who Could Be Liable if Something Goes Wrong?

By Matt and Ted Ritter

Let's suppose that your fellow Car Club member "John" has volunteered to direct traffic at one of your club's shows. As John is directing the cars parking on the show field, his eyes are drawn to a beautiful '57 Corvette that has just pulled in. While John is momentarily distracted from his duties, a GTO backs into a Model A, damaging both show cars. Tempers flare. Everyone is pointing fingers. Who is responsible?

One rarely considers the possibility of an accident occurring at a Car Club event. Nevertheless, an accident is a real possibility at nearly every Club event, and the potential liability of a Car Club, its officers, members, and volunteers is an issue worthy of discussion.

In addressing these questions, initial distinctions must be made. First, is there liability by reason of the actions or omissions of the Club and its representatives? If so, can such liability be enforced only against the Club itself, or can a claim be brought against the Club's officers and individual members?

Generally speaking, a Club is liable for a wrong committed by its members or officers in the course of their actions. The Club is responsible for damages or personal injuries caused by a failure to use ordinary care.

A Club that organizes and promotes an event will be liable for damages to spectators or their automobiles, caused by negligence in planning or conducting such an event.

In addition to liability for negligence (the failure to exercise reasonable care), a Club may be liable for wrongs of a more "active" nature. Where an attempt is made to blame a Club for the wrongful act of a member, the question becomes whether or not that member, at the very time of the incident, was under the control of the Club.

In the reverse, officers or individual members of a Club can be personally liable for an act which they commit or participate in, or which they authorize. In this type of situation, it makes no difference whether the Club itself may also be liable. Liability can even extend, in certain situations, to a member who does not participate in the wrongful act, if that member sets something in motion, or agrees to a course of action which culminates in the harm.

Where the members of a Club agree to a course of conduct to accomplish an agreed purpose, each member could be held liable not only for his or her own acts, but for the acts of each other, and for all. It should be noted, however, that mere membership in a Club, or the payment of dues, does not make all members individually liable for acts of their associates done without an individual member's knowledge or approval.

Further, a New Jersey Statute, N.J.S.A. 2A:53A-7.1, accords immunity to most persons performing work for a non-profit organization (unpaid officers, directors, trustees and members, as well as volunteer workers), unless the wrongful act is willful, wanton, or grossly negligent. This statute, however, expressly does not apply to the negligent operation of a motor vehicle. Since charitable immunity is an evolving and somewhat uncertain area of the law, readers should be aware only of the possibility of immunity.

Examples can serve to put these various legal concepts into perspective.

Let's return to the fender bender accident involving Club member "John." Let's assume that John's negligence caused the GTO to hit the Model A. No one was injured, but both vehicles sustained damage. In this situation, the Club would be liable as the organizer and sponsor of the event. Additionally, the Club's officers or individual members could also be sued under the theory that they authorized John to direct traffic. Since John was not operating either vehicle, statutory immunity should absolve him from personal liability, but not the Club itself.

Let's try a different scenario. Say that Club member "Jane" is in the process of parking her vehicle at one of her Club's events. Jane in a moment of adolescent weakness, performs a crowd-pleasing burnout. In doing so, she loses control and hits another show vehicle. Again, Jane would be personally liable for her negligence. However, Jane was not acting as an agent of the Club at the time of the incident. Thus the Club, and its individual members, would not be liable. Note that statutory immunity would not be available to Jane because she was negligent in the operation of her motor vehicle.

One last example may be helpful. This time, member "Richard" is participating in some type of Club-sanctioned competition. During the competition, Richard somehow loses control of his muscle car. As a result of the club's failure to keep the crowd at a safe distance, a bystander is hit and injured by Richard's car. In this case, Richard would again be liable for his own negligence. The Club could be liable for the failure to properly organize such an inherently dangerous, Club-sanctioned event. Individual Club members, in addition to Richard, could also be held individually liable, because the competition was approved by the Club's members.

The realities surrounding events where members and participants operate powerful vehicles should not be ignored. As one can readily see, liability usually extends to the individual who is responsible for an accident, but can also potentially extend to a Club member who is not even in attendance.

The best way to prevent a claim is to act, at all times, in a reasonably prudent manner. As we discussed in the last issue of Cruisin' News, proper event planning and management is indispensable. Finally, the purchase and maintenance of a Car Club liability insurance policy is a very good idea.

About the Authors:

Ted Ritter and Matt Ritter have been active in the hobby since 1964 and 1978 respectively. Both are New Jersey licensed attorneys.

The Ritter Law Office, L.L.C.
1-866-930-0233 | E-mail Adhering to the highest ethical and professional standards