Legal Question in Insurance Law in California

I was involved in an accident. I was driving a rental car and I bought liability insurance from the rental car company. The accident was largely due to my fault. The other driver claimed damage from a) the car rental company b) his own insurance under UIM. He got paid by his own insurance (about $2000 -- the damage that he claimed). He also assigned all rights/tittle in the claim to his insurance company.

One month later he also got a settlement from the car rental company (about $500). He also signed a property damage release form (discharging me and the rental company forever from any claim). But it seems that he did not inform his insurance company about this settlement. In all, he pocketed $2500 from both parties.

Now, his insurance company has sued me and the rental car company for damage ($2000 that they paid to the other driver)? Can we be held liable for this damage, especially if we have a property damage release from the other driver?

Does the date of property damage release matter ?? It was executed one month after he assigned all rights and title of this claim to his own insurance company?


Asked on 7/24/09, 9:07 pm

1 Answer from Attorneys

In general, if a person assigns all right title and interest to a 3rd party, the 3rd party owns the claim. The original claim holder no longer has power to release you. HOWEVER if he sold you a release without telling you he had done so, he may have committed fraud. You could then make a claim against him for the damages.

As a practical matter, you may want to report this to your insurance company and explain this to his insurance company and to him.

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Answered on 7/24/09, 10:10 pm


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