Keoghs’ Complex Credit Hire Team

Keoghs’ market leading complex credit hire team consists of 12 members with over 100 years of credit hire experience between them. The team handles any high value cases or matters of particular complexity (eg. precedent setting cases) and assists the credit hire unit and our clients by providing strategic advice and support. This article highlights some of the types of cases and successes the team have had in, not only defeating these individual claims, but also building upon, and reinforcing, successful strategies already deployed. In the last financial year the team saved clients over £3m.

S v U
Saving: £157,500 Handler: Mel Mooney

The claimant, the owner of a Bentley Flying Spur, pursued a claim for hire charges of £143k. Originally alleging impecuniosity he suggested net earnings of around £65k. Following a successful application for full financial disclosure however, we found that his net earnings were in fact around £250k. Claiming this was a ‘mistake’ it was only when he failed to provide some financial documents that we obtained a debarring order. We also discovered that he was not in the country for much of the period of hire. However, he claimed that, as they were short trips, it was unreasonable to expect him to return the hire vehicle each time. There were also delays in his vehicle being repaired as he had initially refused the vehicle to be declared a total loss.

No notice of the right to cancel was provided to the claimant pursuant to the Cancellation of Contracts Made in a Consumer’s Home or Place of Work etc. Regulations 2008. However, the hire charges were paid in two installments by an alleged after the event policy of insurance. The policy had a £100k indemnity limit therefore, pursuant to W v Veolia, we argued that the limit of recovery was £100k not the actual sums paid, a point conceded in the claimant’s skeleton argument. Although there were two separate hire agreements, only one policy of insurance was disclosed for the first. We argued that this policy only covered the first agreement and that charges under the second were irrecoverable.

In the skeleton argument it was alleged that the first policy would cover all the claimant’s dealings with the CHO and not just the first agreement. At trial however, the claimant asserted that there was a second policy of insurance yet no evidence of it was produced. The court’s attention therefore, was drawn to a clause in the policy which stated that it would not be effective if there was another policy of insurance. The court held that the second hire agreement was irrecoverable and awarded the claimant damages in relation to the first agreement only, a sum of £8,959.38 As the claimant had not beaten our pre-proceedings offer, they were awarded no costs and the defendant was awarded all their costs plus interest (approx. £23,500).

This matter demonstrates that it is always sensible to plead for every eventuality and to be persistent in seeking proper disclosure from the claimant and to take appropriate action should they not do so voluntarily.

H v O
Saving: £33,420.47. Handler: Kristian Garner

Quantum dispute. The claimant brought a claim for £18,050.50 for hire, £4052.13 for storage and recovery and personal injury. The insurer client had put forward a global Part 36 offer of £17,583.48 pre-litigation but this was rejected by the claimant. Via way of Part 18 questions and in open correspondence, we queried the need to hire, the period rate and impecuniosity. These were answered by the claimant only in piecemeal fashion.

We requested disclosure of all of the claimant’s financial documentation in our allocation questionnaire and the court agreed. The claimant provided some of this but it was clear there was reference to other bank accounts and loans which had not been disclosed. We argued that the claimant had failed to comply with the exact wording of the court order and requested they be debarred from relying upon impecuniosity. We also obtained rates evidence which showed our insurer client’s pre-litigation offer was reasonable. The offer was maintained.

The claimant argued that the reason they remained in hire for so long was because the defendant’s insurers had not released a cheque quickly enough despite them saying one would be forthcoming. Irrespective of the delays, we argued that the claimant had a duty to mitigate his losses and should have utilised the benefits afforded to him under his comprehensive policy of insurance. Failure to do so represented a failure to mitigate. In the alternative it was argued that he should have utilised his own funds sooner as per Fettes v Williams and/or Opoku v Tintas.

The matter was due to proceed to a final hearing but, at the doorstep of the court, the defendant’s Part 36 offer made pre-litigation was accepted. The defendant paid the claimant’s costs up to the expiry of the Part 36 offer (£4,094.00). The claimant had originally claimed £25,435.32 in costs. They were also ordered to pay the defendant’s entire costs which were assessed at £4,530.00.

This case ratifies Keoghs’ strategy on the failure to use a comprehensive policy and also the importance of a strong Part 36 offer made at the earliest opportunity.

B v M
Saving: £11,483.88. Handler: Keiron Fulop

Quantum dispute. The claimant sought £14,514.19 in respect of hire charges. Considered the type of vehicle, the claimant’s name and his address, we suspected he was a professional premier league footballer. The claimant’s solicitors refused to confirm that this was correct and maintained that their client was impecunious and, as such, was entitled to hire a Porsche Cayenne for 30 days at a credit hire rate of £483.80 a day. No financial evidence was forthcoming. We obtained basic hire rate evidence which equated to less than 50% of the daily rate claimed. An offer of £3,030.31 was made.

At the allocation stage the claimant’s solicitors requested that the matter be transferred to Hull County Court for the convenience of the claimant. This occurred approximately a week after the footballer with the same name transferred from Middlesborough FC to Hull City FC. In discussions with the claimant solicitors we advanced our suspicions as to who the claimant was and that we felt they would find it extremely difficult to allege impecuniosity given who they were. Our offer of settlement was accepted.

Again, this matter highlights the importance of not only knowing your opponent but knowing your claimant and the use of intelligence and search facilities throughout the life of the claim.

L v AS
Saving: £48,194. Handler – Miranda Lord

Liability was in dispute. The claimant sought £43,710.00 in hire charges, £450.00 excess and £4034.00 in respect of the PAV.Using Part 18 questions and general correspondence, the claimant was asked of their need to hire a state of the art, high end Audi when he was unemployed and homeless. Using Keoghs’ Intelligence Service and other investigations, we were able to flag that the character of the claimant was under question and that he had been arrested, whilst in the credit hire vehicle, for selling and dealing drugs.

A court application was made specifically requesting copies of the credit hire organisation’s (CHO) monitoring notes in relation to the period of hire. This was granted. Given the long list of issues we discovered in relation to the claimant’s character and also the fact we had put significant pressure on the CHO for disclosure of their records, which they had been reluctant to give, the claimant’s solicitors came off record and the claim was withdrawn. Our insurer client agreed not to pursue our costs given the claimant was homeless and asset searches showed him to be a man of straw.

This case demonstrates the need for full and comprehensive investigations using all tools at the handler’s disposal.

It also highlights the need to be on the front foot and put pressure on the both claimant solicitors and CHOs in relation to requesting information they are reluctant to give and utilising the court to assist by way of court application.