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Elite Moving & Storage, Inc. made a practice of renting trucks from Malco Enterprises of Nevada, Inc. One of the trucks sustained damage when Elite rolled it over. Malco demanded that Elite pay the damage. When it did not, Malco filed suit.
Vehicle rental agreements almost universally say that the renter will be responsible for any damage done to the vehicle, even if the driver was not negligent. Optional LDW protection waives that provision and protects the renter from having to pay the rental car company for such damage. LDW protection is normally offered to the renter by the customer service agent at the time the vehicle is rented.
Elite defended against Malco’s suit arguing that the optional Loss Damage Waiver protection should cover the repairs. The problem for Elite was that the “Decline” box adjacent to the offer of LDW protection had been checked and Malco had not added any charges for LDW protection.
Elite’s response was that adjacent to the “Decline” box, there was a place on the contract for initials. No one had initialed the “Decline” box. Elite argued that because there were no initials, the waiver was ambiguous and could not be enforced against it.
The trial court found that despite the lack of initials, the rental agreement was valid and enforceable and awarded Malco Enterprises $20,501.73. Elite appealed.
In its unpublished opinion of Elite Moving & Storage, Inc. v. Malco Enters. of Nev., Inc., No. 67061, 2016 Nev. Unpub. LEXIS 152 (May 11, 2016), the Nevada Supreme Court agreed with the trial court. According to the Supreme Court, the clincher was that Elite’s president testified at trial that it was not his practice to purchase LDW protection for the vehicles that it rented from Malco. The Supreme Court said that the course of conduct of the parties could be considered to interpret an otherwise ambiguous contract. See NRS 104.2202(1) and Ringle v. Bruton, 120 Nev. 82, 91, 86 P.3d 1032, 1037 (2004).
If you have questions about coverage issues surrounding rental cars and particularly Loss Damage Waiver protection, please contact Mike Mills at Bauman, Loewe, Witt and Maxwell by phone at 702-240-6060 or by email at mmills@blwmlawfirm.com. He will happily discuss your questions.
