President’s Message: Wis. Stat. § 343.15 —“How About a Cap for the Silent Majority . . . Parents?”

WDC Journal Edition: Winter 2013
By: Arthur P. Simpson, President, Wisconsin Defense Counsel

Wisconsin has a tradition of legislative action from both sides of the aisle. In recent years, we have seen longstanding statutory provisions concerning uninsured and underinsured motorist coverage modified to prohibit reducing clauses, then within two years modified to allow reducing clauses. Both were a statement of Wisconsin public policy.

We have also seen a statutory cap with respect to punitive damages. There have been previous caps with respect to medical malpractice exposure. There are various caps protecting the government from liability.

Our state has granted immunity to motorcyclists who refuse to wear a helmet. The state has seen fit to limit the responsibility of those who elect not to wear a seatbelt to a maximum of 15% negligence. In short, there has been a crazy quilt of caps and limits with real implications for those involved in accident litigation.

One can debate at length the merits of legislative intervention into the common law regarding recovery for injuries. There are legitimate arguments that bona fide legislative policies justify limiting exposure. There are arguments that the chips should “fall where they may” with no special statutes. Various interests have secured legislative remedies to perceived inequity for years.

One statute that neither side of the aisle has addressed is Wis. Stat. § 343.15(2)(b), also known as “Sponsorship Liability.” The statute provides:

Any negligence or willful misconduct of a person under the age of 18 years when operating a motor vehicle upon the highways is imputed to the parents where both have custody and either parent signed as sponsor, otherwise, it is imputed to the adult sponsor who signed the application for such person's license. The parents or the adult sponsor is jointly and severally liable with such operator for any damages caused by such negligent or willful misconduct.

This law imposes unlimited liability upon parents or adult sponsors of a minor’s driver’s license. (We wonder how many parents are aware of this provision before an accident.) Strangely, Wisconsin has a $5,000.00 limit on damages “for personal injury attributable to a willful, malicious, or wanton act of the child.”[1] On the other hand, if your child “negligently” causes a vehicular accident, the parent faces unlimited liability.

I propose that the legislature amend Wis. Stat. § 343.15(2)(b), adding one sentence—a sentence for parents. That sentence would provide:

The limit of liability for all parents or adult sponsors to all parties from any one accident shall be a maximum of $300,000.00.

The current law imposes unlimited liability upon parents or adult sponsors of a driver’s license. However, parents cannot insure for any one large loss, and such a loss can lead to the financial ruin of the parent or sponsor. The amendment allows a parent or sponsor to secure insurance to $300,000.00 (multiple times the current minimum limit for a liability policy in Wisconsin). Parents would then be able to protect themselves from unlimited liability. This would eliminate the game of “Russian Roulette,” which all parents and sponsors play whenever a minor is given the keys to a vehicle. The statute would not impact drivers’ responsibility for all damages. However, it would allow parents who have responsibly secured insurance to limit their liability to a figure far beyond the minimum limit to obtain financial security.

The statutory provision would have the biggest effect on small business owners and professionals. These are the individuals with the greatest risk when their child is involved in an accident.

We are not rewriting the common law here, contrary to many caps and limits. The current statute is not the common law but rather a legislative carve-out of specific liability. We need to modify the statutory rule, not change the common law.

The legislature has seen fit to limit parental liability for willful, wanton, and malicious acts to $5,000.00. It makes no sense to create unlimited liability for parents with respect to driving.

One can imagine an intersection accident with debated negligence but large damages. This is a claim that can legitimately be defended but at the same time not necessarily won by a defendant. The parents are at risk for personal financial exposure simply because their child was involved in an accident. This type of accident is something that happens to adults routinely. The adults remain responsible for their own conduct, but family members are not also rendered liable for actions over which they have no control.

The other type of accident is a more aggrieved situation. The parent may think their child is at a friend’s house for the evening, but the child is involved with underage drinking or some other wrongful activity that ultimately leads to a serious accident. The child is responsible for that conduct. However, the unknowing parent should not be punished with unlimited tort liability.

The basic goal of the statute is to make sure that someone is financially responsible in the event of wrongdoing by a teen driver who has limited assets. The $300,000.00 requirement would encourage parents to obtain insurance coverage far in excess of the current statutory minimums. This would provide protection to the public but at the same time provide a reasonable protection for parents.

The legislature has carved out a special rule for those who wish for their children to operate a vehicle. The rule is unduly harsh should the child become involved in a severe accident. It should be revised to cap the liability of the parent or sponsor at a figure that allows one to secure appropriate insurance when one allows a teenager to drive.

[1] See Wis. Stat. § 895.035(2)(a), (4). Section 895.035 is a dazzling statute in and of itself, outlining the exposure of parents for acts of a minor child, but the general premise is a cap of $5,000.00 in liability for willful, malicious, or wanton personal injury.