Home / Insight / Be careful what you wish for...a cautionary tale

Be careful what you wish for...a cautionary tale

04/10/2016

When advising clients on appeals we have always stressed that the most important thing to consider is not what happens if you win, but what happens if you lose - and that how your opponent may react to your course of action must be carefully thought out.

Melanie Mooney, Technical Director of Credit Hire, dealt with an appeal which proves the point perfectly.

The facts

The claimant’s Toyota Avensis was damaged in a non-fault accident on the 11th July 2014.  He hired a vehicle on a credit basis and incurred charges in the sum of £7017.55 which he sought to recover from the defendant.  The hire charges were disputed by the defendant on the basis that they were excessive and the matter came to trial in Birmingham County Court on 19th January 2016.

Issues for the court to consider were the applicable rate of hire (the claimant not being impecunious) and the period of hire.

The defendant adduced rates evidence and the claimant in turn sought to rebut that evidence by way of a witness statement. Neither witness was in attendance at the trial. In oral evidence the claimant confirmed he could have repaired his vehicle using his own funds.  Nevertheless, he did not do so because he wanted confirmation that he would be reimbursed by his insurers for the money he would have spent on getting the repairs completed. He accepted that the vehicle could have been repaired by the end of July 2014, however he waited for payment in September 2014 before proceeding to repair his vehicle.

At the hearing before Deputy District Judge Price, she preferred the evidence of the claimant as to the applicable rate of hire, yet in awarding the rate of hire she referred to the ABI GTA rate (namely the sums due for payment within 30 days) on the basis that the claimant, in mitigating his loss and having confirmed he could have paid for the repairs, would have paid the charges as soon as possible. She also found that the period of hire was reasonable and awarded the sum of £3306.54 for hire charges. The claimant appealed the decision.

The appeal and cross appeal

The claimant appealed on the basis that the Judge was wrong in awarding the ABI GTA rate and that having preferred the claimant’s evidence as to rates, the defendant had failed to discharge the burden of showing there was a difference between the credit rate and the basic hire rate and what that difference was (stages 4 and 5 of the test as laid down in “Bent”). They contended therefore that the full commercial rate of credit hire should have been awarded.

Permission to appeal was granted and upon our advice and on behalf of the defendant we submitted a cross appeal on the following grounds:

  1. The judge was wrong in fact and/or law in carrying out the stripping exercise relating to the rate of hire

  2. The judge was wrong in fact and/or law in preferring the evidence of the claimant

  3. The judge was wrong in not accepting the defendant’s rates evidence

  4. The judge was wrong in fact and/or law in finding the claimant was entitled to wait for confirmation from his own insurers that he would be paid out

  5. The judge was wrong in fact and/or law to decide that the claimant was entitled to hire for a period of 63 days.
    Permission to appeal on each and every ground was granted.

The result

The matter came before HHJ McKenna on 9th August 2016 with judgment being handed down (it having been reserved) on 7th September 2016.  He found that the judge had fallen into error in awarding the ABI GTA rate and therefore the claimant was entitled to recover the commercial rate.  He also found, however, that the judge had asked herself the wrong question when considering the recoverable period of hire.  The question was when the claimant, having the means to do so, could have mitigated his loss (and it was his duty alone to mitigate) and repaired his vehicle, not when he could have done so with the help of his insurers, or indeed anyone else.

He therefore found that the claimant could and should have repaired his vehicle by 31st July 2014.  This resulted in an award for hire in the sum of £1780.50 meaning that the claimant was required to repay the defendant £1526.34.

There was additionally no order as to costs meaning that the appeal for the claimant, albeit successful, was very much a pyrrhic victory due to the cross appeal and the costs involved.

Author

Melanie Mooney

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