“This case raises the moral question which has occasioned me much anxious thought…..whether the ever increasing insurance premiums of the ordinary motorist…..should in some part be used so that the rich may continue at no expense to themselves to be filled with good things that they think they need…”
HHJ Cowell – Singh v Yaqubi
In a case which appears to have caught the attention of the tabloid press and aroused the public’s interest, partner Mel Mooney, who handled the case, examines the facts and the potential impact on future cases.
The claimant’s 2002 plate Ferrari 360 Modena was damaged in an accident involving the defendant’s insured on 30 May 2012.
Liability was admitted by the defendant however repairs to the Ferrari became protracted due to the fact that some of the parts required needed to come from Italy.
Shortly after the accident the claimant was in contact with Kindertons Accident Management with a view to them providing him with a replacement vehicle.
It would appear, however, that he informed Kindertons that the Ferrari was his “second” car therefore they declined to provide a service to him.
Mr Frankland was subsequently provided with a replacement vehicle from Accident Exchange and over a period of approximately seven months hired two Ferrari California convertibles at a daily rate of circa £1,080.16, incurring hire charges in the sum of £236,724.00.
In presenting his claim the claimant signed a mitigation statement (containing a statement of truth) confirming that he needed a car whilst his was being repaired; that he did not have access to another vehicle and that he required it to get to and from work, for social and family commitments and for business purposes.
He confirmed he did not have another suitable vehicle either himself or through his immediate family.
Keoghs was instructed to deal with this matter pre-proceedings in May 2013 and enquiries in respect of the hire claim continued, building upon those conducted by the defendant insurer.
Those enquiries revealed that the claimant had access to four other vehicles (a Land Rover, an MG Midget, a Citroen Berlingo and a BMW 335) but then further enquiries revealed, perhaps more importantly, that the Ferrari had a policy term limiting the mileage to 1,000 miles per annum.
It was also confirmed that the Ferrari was not insured for business purposes. In April 2013 the matter was passed by Accident Exchange to their solicitors.
It was reiterated that the hire charges were disputed and in October 2013 the information as to the other vehicles and the policy limitations was disclosed.
Keoghs continued to request either the results of the enquiries that the claimant solicitors had indicated were being made, or confirmation that the claim was withdrawn.
No substantive response was ever received, even when proceedings were issued in March 2015, some 17 months after the issues were initially raised. Those proceedings presented the claim for hire as special damages and no claim for general damages for loss of use was pleaded in the alternative.
As soon as the proceedings were issued, and in order to avoid the cost of filing and serving a defence, an application for summary judgment for the defendant was made, pursuant to CPR 24.2.
Such an application can only succeed if the court finds that the claimant has no real prospect of succeeding on the claim. In this case, that meant that the defendant would have to show that the claimant had no “real prospect” of showing at trial that he had needed the replacement vehicle. The application would fail if the claimant was able to show he had some prospect of success which was not “false, fanciful or imaginary”.
An application for summary judgment may be based on:
1. A point of law;
2. The evidence which can reasonably be expected to be available at trial, or the lack of it, or
3. A combination of these
The matter came before District Judge Read with Judgment being handed down on 10th August 2015.
The application relied heavily on the Court of Appeal case of Singh v Yaqubi (also run by Mel Mooney of Keoghs) and argued that the claimant had failed to comply with the practice direction for pre-action conduct.
It was submitted that the claimant had failed to supply sufficient information to enable the defendant to understand the issues properly (Para 4.4 of the practice direction) and failed to exchange sufficient information to enable the parties to understand each other’s position.
The claimant argued that the Court should not adopt too narrow a definition of “need”, quoting an analogy of someone not needing a replacement for a 60” television in the living room which had been stolen if there was a 17” set in the bedroom. They also submitted that the claimant had not addressed the need to hire before the proceedings because they did not have to and to force them to do so would be putting the “evidential cart before the horse”.
The claimant’s argument was dismissed as to adopt it would be to impose an artificially tight restriction.
“Need” is a simple English word with a simple meaning, to be construed in those terms and the Court opined: “what it means depends upon an assessment of the relevant circumstances and where, as in here, the Court has a “wealth” of evidence, the Court is entitled to accept it at face value for summary Judgment purposes.”
The Judge expressed the view that the mitigation questionnaire (which, as previously mentioned, was signed with a statement of truth) had the force of an unopposed witness statement. The facts expressed in that document had been shown to be false.
None of the evidence put forward by the defendant was challenged or even explained despite ample opportunity being provided. The claimant belatedly sought to argue that even if there was no need to hire, there was still a claim for general damages for loss of use.
The application for summary judgment was granted with the judge commenting that all the evidence effectively and rationally showed that the Ferrari was an occasional hobby and for the Court to find otherwise, given the evidence, would involve the claimant damaging his credibility on oath so badly that he could not be believed on anything.
The particulars of claim gave no clue as to any general damages claim being pursued and therefore this submission was also rejected.
The claimant was ordered to pay the defendant’s costs, particularly as prior to Keoghs’ instruction the defendant insurer had made a speculative Part 36 offer.
The claimant sought to appeal the summary judgment order and judgment was handed down on 7 April 2016 by HHJ Peter Armstrong.
The judge considered the practice direction for pre-action conduct and protocols, in particular Paragraphs 3 and 6. Paragraph 3 states that before commencing proceedings the Court will expect the parties to have exchanged sufficient information to:
a) Understand each other’s position;
b) Make decisions about how to proceed, and;
c) Try to settle the issues without proceedings
Paragraph 6 states that the parties should exchange sufficient information to comply with paragraph 3. This includes disclosing key documents relevant to the issues in dispute.
The judge pointed out that the evidence provided by the defendant put the onus on the claimant to set out the evidence on which he relied.
The claimant’s appeal argued that the application for summary judgment was misconceived and reiterated the position that the claimant still had a valid claim for loss of use. Finally, it argued that there had been no appellate decision as to what “need” actually meant.
It was therefore asserted that the judge had erred in his interpretation of “need” by applying too narrow a definition.
HHJ Armstrong refused to give permission to appeal, thereby preventing any further avenue of overturning the District Judge’s decision.
He found that the judge had correctly identified the legal requirement of the need for a replacement vehicle to be established and correctly analysed the authorities.
Although he could have taken issue with the reference to the Ferrari being a “hobby” it was justified on all the evidence and the decision did not turn on the claimant’s wealth or otherwise.
On the basis of the claimant’s (or his representatives) clear failure to comply with the provisions of the pre-action conduct practice direction, the judge was entitled to find that the claimant had failed to present a cogent case of need for a replacement vehicle and had no real prospect of being able to do so. He did not conduct a “mini trial” and the test was correctly applied.
He also felt that the judge had correctly decided the pleading point in that it was not such a decision that no reasonable judge could have made.
The appellant is to pay the respondent’s costs of the appeal.
This was an important result, not only because of the staggering amount of hire charges accrued but also because of the conduct of the claimant’s representatives in failing to exchange information and documentation in accordance with the practice direction for pre-action conduct. Common sense has prevailed in the upholding of the judgment and hopefully we will now see a more reasonable approach to the provision of information to all those who are faced with credit hire claims. It is not sufficient for claimants (via the CHO or their representatives) to simply present a claim, sit back and issue proceedings without providing information the defendant legitimately requires.
It is important to note how heavily the court relied on the Keoghs case of Singh v Yaqubi.
From a practical perspective, requests for information which are made to a CHO/claimant/representatives should refer specifically to the practice direction for pre-action conduct and make it clear that they must comply.
Melanie Mooney
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