The Law School Authority

Lauvetz v. Alaska Sales and Service d/b/a National Car Rental Case Brief

Summary of Lauvetz v. Alaska Sales and Service d/b/a National Car Rental (1991)

Facts: P rented a car from D rental company; P opted for the collision damage waiver,  paying an additional $8.95 per day; on the face of the rental agreement there was no indication of the scope of the coverage; p did not read the terms and condition, which prohibited, and caused the elimination of the CDW, intoxication while driving and reckless driving; the van was damaged, and as a result of the accident, P was charged with and plead no contest to reckless driving; D subsequently filed this lawsuit seeking damages for the wreck of the van

P/S: D obtained partial summary judgment

Issue: Whether the purchaser of the damage waiver reasonably expected the waiver to be subject to any exclusions.

Holding: A consumer would not reasonably expect the damage waiver to be less than complete, REVERSED, REMANDED, for P

Rule: Customers are not bound to unknown terms which are beyond the range of reasonable expectation.

Rationale: Court adopted Restatement § 211; this section establishes the general enforceability of the terms of standardized forms, without regard for whether the customer reads or understands those terms.  Reasonable expectations are those expectations a consumer would have after reading the form.  When offered the CDW, the bailee would reasonably expect this option, at the not inconsiderable rate of $ 8.95 per day, to relieve him of responsibility even if the damage were caused by his fault.  “we join the large number of courts who have refused to enforce damage waiver exclusions under a variety of circumstances.”

P Claim: the exclusions were beyond the reasonable expectations of lessees accepting National’s standardized contract.

D Claim: National contends that P’s position that a prohibition against drunk and reckless driving is an unconscionable or unreasonable limit on the CDW is absurd.

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