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Ford to Halt Leasing in New York Because of State's Liability Law

June 24, 2003|From Bloomberg News

Ford Motor Co. said Monday that it would stop leasing vehicles in New York on July 10 because the state didn't change a law that allows lessors to be held liable for accidents.

"We need to limit our exposure as it continues under the present law in New York," A.J. Wagner, executive vice president of Ford's credit unit, said in a statement.

"We are very disappointed that the New York Legislature adjourned without addressing this important issue."

New York, Rhode Island and Connecticut permit a leasing company to be held liable for accidents caused by the customer.

Dearborn, Mich.-based Ford said in April that its Ford Motor Credit Co. consumer-finance unit and other lessors could face "several billion dollars in potential payouts" because of the law. New York's so-called vicarious liability law dates to the 1920s.

Ford cited a $1-million verdict against its consumer loan unit resulting from a suit by a girl whose father, while driving a leased car, ran over her while she was sunbathing.

Shares of Ford fell 22 cents to $11.30 on the New York Stock Exchange.

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