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Hotel responsible if car is stolen or damaged by valet – Supreme Court

Hotel valet crash
File Photo. Few years ago, a Lamborghini was crashed by hotel valet in New Delhi.

It has long been unclear who is responsible if something were to happen to your car when it is parked inside the hotel premises or handed over to hotel valet. Now, there appears to be some guidance regarding the matter. The basis lays on venue undertaking valet parking.

In a bizarre incident from a while earlier, an insurance company refused payout when a thief pretending to be from the valet service at a highway hotel asked a guest for his car key so that the car could be parked properly. The event having occurred in 2015, saw the court rule against the complainant in 2019. As it turns out, the hotel did not have a valet service, and the car owner was pulled up for negligence and carelessness.

Now, in a ruling in a separate case it would appear not all is lost in case of a valet parking theft. The basis of this judgment says burden of proof lies on the hotel, which needs to explain loss or damage to a vehicle parked isn’t on account of its negligence as per Sections 151 and 152 of the Contract Act. So, if a guest’s vehicle is stolen or damaged, a hotel is responsible even if the parking slip contains a non-liability clause.

Hotel valet
Image for reference.

The incident occurred on the night of August 1st, 1998 at the Taj Mahal Hotel. Upon reaching the hotel, car owner handed over his car and its keys to the hotel valet for parking. The parking tag handed to him read, ‘This vehicle is being parked at the request of the guest at his own risk and responsibility in or outside the Hotel premises. In the event of any loss, theft or damage, the management shall not be held responsible for the same and the guest shall have no claim whatsoever against the management.’

And this isn’t an exception. Most valet slips come with a non-liability clause. However, the outcome for the case at hand brings some clarity to the matter 20 years after the Maruti Zen car was stolen. When a hotel actively undertakes to park a vehicle in safety and return it on presentation of a parking slip, a contract of bailment exists. As such, a hotel would be liable as a bailee for returning the vehicle as it was received.

The ruling further touches upon ‘complimentary’ services five-star hotels provide, and that these are not actually free-of-cost. Costs are covered by exorbitant charges for room rentals, food, entry fee to lounges and clubs, and so on. Even if valet parking service is offered gratuitously, it benefits the hotel.

Reasonable care of vehicles parked by valets entails keeping car keys out of reach of outsiders, safe and well-maintained parking zones, CCTV cameras and handing over a car only to those who present the parking slip. A hotel isn’t responsible for damages to a vehicle when the event is outside their control, i.e, like a natural disaster. You can read the full verdict here.

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