McKenna v. Beesley, D077189

Background:

On August 4, 2017 McKenna (pedestrian) was injured in a vehicle collision involving a truck driven by Wells; Wells allegedly ran a red light and fled the scene.
Wells was not licensed at the time and had prior DUI-related suspensions; he had been doing handyman work for Beesley and drove a truck owned by Smoothreads (Beesley is Smoothreads’ CEO).
McKenna sued Smoothreads (owner) for negligent entrustment and Beesley (hirer) for negligent hiring; plaintiff alleged defendants knew or should have known Wells was unfit to drive.
Smoothreads moved for summary adjudication and Beesley for summary judgment; both motions were granted by the trial court, which held there was no duty to inquire absent actual notice of unfitness.
On appeal the court considered whether Vehicle Code §14604 (owner’s statutory duty to make a reasonable inquiry into a prospective driver’s license) affects the constructive-knowledge element of negligent entrustment, and whether a hirer has a comparable duty under §14606.
The Court of Appeal reversed the summary orders, holding that failure to make the statutory reasonable inquiry can support a jury finding of constructive knowledge as to both owners and hirers.

Issues:

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether an owner’s breach of §14604’s duty to make a reasonable inquiry can supply constructive knowledge for negligent entrustment	McKenna: owner’s failure to inquire about license status supports constructive knowledge that driver was unfit	Smoothreads: negligent entrustment requires actual knowledge; §14604 is criminal and does not create civil duty here	Held: Yes — breaching §14604 and permitting an unlicensed driver may support a jury finding of constructive knowledge; triable issue existed
Whether a hirer who entrusts a vehicle to a driver must make a reasonable inquiry (analogous to §14604) and can be liable for negligent hiring when the hiree is unlicensed	McKenna: hirer’s duty should be at least co‑extensive with owner’s duty; failure to inquire supports constructive knowledge	Beesley: no precedent imposing such an inquiry duty on hirers (relying on Dodge Center) and no actual knowledge here	Held: Yes — a hirer who fails to make a reasonable inquiry and allows an unlicensed hiree to drive may be found to have constructive knowledge; triable issue existed
Whether the trial court properly granted summary judgment/adjudication to Beesley and Smoothreads	McKenna: deposition and DMV history show Wells unlicensed and Beesley/Smoothreads made no inquiry — creates triable issues	Defendants: no actual knowledge, no duty to inquire absent notice; summary relief proper	Held: Trial court erred; summary orders reversed and triable issues remain as to constructive knowledge and duty-to-inquire breach

Key Cases Cited

Diaz v. Carcamo, 51 Cal.4th 1148 (Cal. 2011) (constructive or actual awareness that a person is unfit underlies negligent hiring/entrustment)
Philadelphia Indemnity Ins. Co. v. Montes-Harris, 40 Cal.4th 151 (Cal. 2006) (statutory scheme addressing unlicensed drivers informs common‑law negligent entrustment duty)
Richards v. Stanley, 43 Cal.2d 60 (Cal. 1954) (absent statute, owner generally has no duty to keep car out of third party’s hands without notice of incompetence)
Dodge Center v. Superior Court, 199 Cal.App.3d 332 (Cal. Ct. App. 1988) (seller owed no duty to inquire into purchaser’s license status; discussed statutory duties for renters/rentals)
Owens v. Carmichael’s U‑Drive Autos, 116 Cal.App. 348 (Cal. Ct. App. 1931) (unlicensed driver is prima facie evidence of incompetence for negligent entrustment)
Osborn v. Hertz Corp., 205 Cal.App.3d 703 (Cal. Ct. App. 1988) (rental agency’s statutory duties can give rise to negligent entrustment liability)
Hartford Accident & Indemnity Co. v. Abdullah, 94 Cal.App.3d 81 (Cal. Ct. App. 1979) (dealer’s failure to inquire about license before test drive could support negligent entrustment)
Smith v. Santa Rosa Police Dept., 97 Cal.App.4th 546 (Cal. Ct. App. 2002) (describes §14604’s duty of inquiry and its potential civil‑negligence relevance)
Syah v. Johnson, 247 Cal.App.2d 534 (Cal. Ct. App. 1966) (classic statement of negligent entrustment liability)
Ghezavat v. Harris, 40 Cal.App.5th 555 (Cal. Ct. App. 2019) (overview of negligent entrustment elements)