Former Owner's Liability After a Reported Vehicle Sale

Attorney Answer

Owning the car on paper is not, by itself, what makes a person liable for a crash someone else caused in it. But a lawsuit that has been served does not go away because you have a good defense — it has to be answered, on the court's schedule.

Texas liability is fault-based. The person liable for a crash is normally the person whose driving caused it. To reach the vehicle's previous owner, a plaintiff has to prove a theory that goes beyond the name on a title. The usual one is negligent entrustment, and the Texas Supreme Court set out what it takes in Schneider v. Esperanza Transmission Co.: the owner entrusted the vehicle to a driver who was unlicensed, incompetent or reckless, the owner knew or should have known that, and the driver's negligence caused the crash. If you had already sold and handed over the car before this wreck, you entrusted nothing to anyone, and there is nothing for that theory to attach to.

Texas also has a procedure for reporting a sale to the state, and the paperwork you kept — the bill of sale, the report you submitted, the sale ad — is exactly the sort of proof that fixes when the car left your hands. Precisely what legal weight that reporting carries is a question for a lawyer with the documents in front of them.

One more feature of Texas fault law is worth knowing while you are frightened by the paperwork. Under Tex. Civ. Prac. & Rem. Code § 33.013(a), a defendant found liable owes only the percentage of the damages matching its own share of responsibility. Section 33.013(b) is the exception: a defendant whose own share is greater than 50 percent, or who acted in concert with another in certain intentional criminal conduct, is jointly and severally liable for the whole. Outside that exception, Texas is not a state where the deepest pocket in the case automatically pays the whole verdict.

What you can do

1. Do not ignore the papers. A served lawsuit carries a short court deadline to respond, and missing it can produce a judgment against you without anyone ever deciding whether you did something wrong.

2. Send a copy of the suit to your auto insurer today, and to any insurer that covered the vehicle at the time. Insurers frequently owe a defense even to a claim they expect to defeat, and that defense costs you nothing.

3. Put your proof in one place: the bill of sale with its date, the confirmation of the report you filed with the state, the sale ad, and any messages with the buyer.

4. Write down, from the documents rather than from memory, the date you handed over the car and to whom.

5. Take everything to a Texas attorney this week and ask specifically about getting out of the case early rather than defending it all the way to trial.

Most lawyers offer a brief initial call at no cost, and a few minutes on your specific facts is worth more than any general guidance, including this page.

⏱ Time limits apply. The claim against you runs on the two-year period in Tex. Civ. Prac. & Rem. Code § 16.003(a) for personal injury and property damage, but that is not your urgent deadline. The court's own deadline to file an answer is far shorter and it started when you were served. How much time you actually have depends on your facts, so get this in front of a Texas attorney immediately.