Citroen Picasso: Car was clearly a write-off
A senior district judge has again attacked credit hire claims, as well as a process-driven approach to bringing them, in a case where he awarded £1,200 for a claim valued at £50,200.
DJ Richard Lumb, a former president of the Association of His Majesty’s District Judges, placed the blame firmly on the shoulders of the claimant’s solicitors, Newcastle-based Winn Solicitors, as he did in another credit hire case we reported last week.
“The present case is an illustration of what happens when the carefully drawn business model of the credit hire company and its owners, often, as in this case, the solicitors conducting the litigation on behalf of the claimant, go awry because the carefully regimented prescribed process is not followed by either the claims handlers or fee-earners at the solicitors,” he said.
“Further, in the present case there were certain features that made the case unusual which required adaptation of the standard model claim process. Regrettably, the individuals with conduct appear to have had insufficient understanding of what they were doing and why it was important to be accurate and a need to amend the process accordingly.
The claim crumbled in part because the oral evidence of the claimant, David Wiltshire, stood in “stark contrast” to his written witness statement – the latter “followed a template precedent that in the court’s experience is almost always used by Winn Solicitors”.
DJ Lumb said: “That credit hire litigation can be characterised as bulk litigation does not excuse an overreliance on a prescribed process of precedent documents including witness statements.
“There is still an obligation to ensure that any witness statement complies with CPR part 32 and the practice direction thereto. Blind following of a company process is no substitute for understanding these requirements.”
Mr Wiltshire’s daughter had made the initial call to his insurer, the AA, which put her through to Winns. He was not aware of this when she passed him the phone and so told the court he did not believe he was instructing solicitors to pursue a claim on his behalf at that time.
He also denied being told that Winns’ directors were directors of the credit hire company, On Hire, as well.
On the evidence, it was clear Mr Wiltshire had not agreed to pay any delivery or collection charges for the replacement car – a small part of the claim – and DJ Lumb held he had not discharged the burden of proof as to the enforceability of the credit agreements.
For reasons that had not been explained, these were only signed more than six weeks after the hire had taken place and the judge found that Mr Wiltshire would only have needed the replacement for three weeks.
DJ Lumb said it was quickly clear the car was a write-off and, as he was not impecunious, Mr Wiltshire would have bought a new car in that time. The credit agreements could not have retrospective effect.
He awarded £1,200 for the alternative claim for damages for loss of use of the claimant’s Citroen Picasso, using a local basic car hire rate as the starting point.
“A careful review of the evidence by those acting for the claimant prior to the issue of proceedings and certainly before trial might have led to the trial being avoided altogether and possible settlement of the claim.
“Had the credit documentation been properly completed then the hire claim would have likely succeeded, and the damages awarded much higher.”
Indeed, had it not been “so obvious” that car was damaged beyond economical repair and had the claimant been impecunious, the full credit hire claim would probably have succeeded.
DJ Lumb concluded: “Many people unfamiliar with credit hire claims may be surprised at how there could be such a disparity in the value of the claim from the amount pleaded of £50,190.24 and the amount awarded of £1,197 due to a failure to follow a process in a business model, particularly when the pre-accident value of the written off car was less than £7,000.
“They may also question why the courts have not intervened in this industry which, given the figures involved paid out by the insurers of the culpable motorists, must surely have an impact on rising motor insurance premiums.
“The answer to that may be that the senior courts have exhausted the arguments at common law and only new legislation by Parliament could alter the position. Whether that will happen remains to be seen.”
A spokesman for the Winn Group said: “Winn is considering appealing and therefore it would be inappropriate to comment further.”
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