On 20 September 2013 the Opinion of Lady Wise was issued in the case of Geraldine Allan v Amlin UK Limited 2013 SCOH 156.
Liability was admitted by the Defenders in respect of a road accident where the Amlin Insured had run into the rear of the Pursuer’s stationary vehicle. Agreement had been reached on all heads of claim apart from the credit car hire charges.
The Pursuer was a member of that Club and, on 11 May 2008, was knocking up with another player when he moved to his left to take up position to play a backhand and his left foot slipped. He broke his ankle.
In relation to these charges the parties had agreed certain information:
- That the Pursuer’s vehicle had been damaged and under repair for fifty days.
- That she required to hire a replacement vehicle of similar or equivalent specification to her own.
- That a Statement of Charges had been issued to the Pursuer by Accident Exchange Limited and that she used a replacement car at £199.11 per day for forty-seven days.
In addition it was reasonable for her to rent such a vehicle for the forty-seven days and that the Statement of Charges included a detailed and accurate breakdown of the credit hire charges in relation to her hire of the replacement for the forty-seven days.
The Pursuer had averred in her pleadings that she was impecunious. On the day before the Proof, the Defenders were advised that she didn’t intend to seek to prove that she had been impecunious.
At the Proof neither party led any evidence of what charges might have been incurred by the Pursuer if she had taken what was referred to as “a straightforward basic car hire contract.”
The Defenders sought to argue that, on the basis the Pursuer had no longer been claiming she was impecunious, then the onus was on the Pursuer to prove basic hire rates if she was not seeking to prove impecuniosity. In addition, it was said that as the Pursuer, in her pleadings, was, through the averments of impecuniosity, offering to prove a lack of choice, that was the only reason the Defenders had allowed the case to go to Proof without seeking to argue the point at an earlier stage.
Lady Wise said that, effectively the issue was where the onus lay to prove “that a Pursuer who has required to hire a car following an accident has not mitigated her loss if she has incurred credit hire charges.”
She considered both Dimond v Lovell 2002 1AC 384 and Lagden v O’Connor 2004 1AC 1067.
She pointed out that in Dimond the House of Lords had decided that any additional benefits over and above what would be incurred under an ordinary car hire contract had to be taken into account in calculating damages. Referring to a well known quote from Lord Hoffman she said that the decision presupposed that the Court would have evidence of both the full credit hire charges and the quantum of any additional benefits within those charges.
In relation to Lagden, she commented on what Lord Hope had said in relation to whether the Dimond principle, requiring additional benefits to be taken into account, could be subject to modification if, in order to minimise loss, a party had no choice but to accept the additional benefits. It had been decided in Lagden that there could be such a modification.
She then went on to consider in particular Bent v Highways and Utilities Construction and Allianz Insurance 2012 PIQRQ1. In that case the Court of Appeal in England held that it was always for a Defendant (Defender) to demonstrate any difference between credit hire charges and basic car hire charges. In that case the Court hadn’t been satisfied that the Defendants had proved that the basic hire rate for the replacement vehicle was lower than the credit hire rate paid.
After some further discussion on an ancillary point, Lady Wise went on to say,
“I have reached the conclusion that in a case where impecuniosity or lack of choice to credit hire charges is not relied upon by a Pursuer, it is for the Defenders to prove that the charges incurred are unreasonable.”
She commented that where a Pursuer leads evidence of a reasonable course of action and proves the cost of such action it is then for the Defenders “to prove that a cheaper method was available and thus seek to prove that the Pursuer has not mitigated her loss. The initial onus of proving loss is on the Pursuer, but all she requires to do is prove that loss.”
In respect of the point that up until the day before the Proof the Defenders had thought the Pursuer was going to try and prove that she was impecunious, Lady Wise said that consideration of the lodged documents, as agreed by the Joint Minute between the parties, should have alerted the Defenders “to the lack of any evidence of the differential between basic car hire charges and the charges the Pursuer incurred. In other words, it was clear that there was no proof of the Pursuer having gained any additional benefits of the type under discussion in Dimond and Lagden.”
She said that the issue of any deduction of additional benefits only came into play where there had been proof of these benefits and the onus of proving the existence and value of any additional benefit lay on a Defender.
This case confirms that even in a case where the Pursuer does not seek to prove impecuniosity but has nevertheless incurred credit hire charges, if the Pursuer is able to prove that it was reasonable that such a course of action (ie, a credit hire) was undertaken and can prove these charges, the Pursuer does not need to go any further. The onus will switch to the Defenders to show that there were additional benefits and that basic car hire charges should apply.