You just can’t get the parts

One of the more frustrating issues for insurance companies facing credit hire claims, has always been how the period of hire can seem to vary, depending on the whim of the garage or bodyshop tasked with repairing a claimant’s damaged vehicle.

Delays in the world of automotive repairs appear to be inevitable. Esoteric parts may have to be sourced, with tremendous inconvenience and attendant delay from the Far East. More prosaically, bodyshops may take on more work than they can sensibly handle, which means their customers vehicles go into the “queue” to be worked on.

But, this, is by and large not a claimant’s fault: delays on the part of the garage and a concomitant increase in the duration of hire are something that a defendant cannot escape liability for, by pointing accusingly at the claimant. The  garage is not the claimant’s agent and it would require an independent intervening event (a novus actus interveniens in Latin) to break the chain of causation, and remove the defendant’s liability for the claim for hire.

But this does not mean in turn that the insurance company is necessarily without a remedy. They may be able to bring a part 20 claim against the  garage blaming their delay and seeking a contribution to the damages for the hire charges which they are liable to pay the claimant. Such claims usually only arise in cases of substantial delay by a garage and/or where the hire claim is very large.

Such claims are in vogue at the moment.

Last year the automotive industry went into Lock Down like the rest of the economy. Claimants were left in hire cars for extended periods of time. Cars which should have been timeously repaired and returned to their owners, were not. Can the cost of the pandemic to the insurance industry, be recovered at least in part from the garages and bodyshops by reason of undue delay on the part of the body which has accepted the job of repair, and assumed contractual obligations to get on with it?

In  Clark v Ardington [2003] QB 36 the Court of Appeal stated:

We believe that the approach of the Court of Appeal in Mattocks v Mann [1993] RTR 13 applies to this case. The defendants’ actions damaged the cars of Mrs Clark and Mr Dennard. They should pay the loss caused by their actions. The actual loss incurred involved hire of replacement cars for ten days in the case of Mrs Clark and 12 days in the case of Mr Dennard. They both appear to have acted reasonably in placing the cars in the hands of respectable repairers and there were no supervening events. Further, delays of that order were foreseeable. The extra loss caused by the delay in the repair must fall on the tortfeasor as there was no failure to mitigate. On the findings of fact in those cases the cost of hire should not have been reduced. The insurers of the defendants should seek a contribution from the repairers for any unjustified length of repair.

This latter sentence contemplates a claim for contribution under the Civil Liability (Contribution) Act 1978 section 1(1) which reads as follows:

Subject to the following provisions of this section, any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly or otherwise).

Thus if an insurance company can prove that the garage is or would be liable to the claimant for  the “same damage”  that the insurance company is liable for, part of the hire charges can be sought by way of contribution from the garage: in effect that extraneous element, which can be said to be caused by the garage’s delay in repairing the claimant’s vehicle and returning it.

The old case of Charnock v Liverpool Corporation [1968] 1 WLR 1498 is authority for the proposition that there would be an implied contract between the Claimant and the garage, that they would repair the car within a reasonable time and that if the garage does not repair it within a reasonable time, it is in breach of contract.  The question of what a reasonable time for performance is treated by statute eg section 14 of the Supply of Goods and Services Act 1982, as a question of fact.

The damage that the insurance company’s insured has inflicted upon a claimant is the head of claim of general damages, for loss of use of his own motor vehicle. Hire charges are simply the quantified special damages expended in mitigation of that head of claim. If a garage then is in breach of contract, by delaying the return of the claimant’s car, so that the claimant’s damages for loss of use are necessarily increased, by his continuing to hire for the period of delay, there is a respectable argument that this is the same damage.

Of course matters may not be so simple, particularly when one starts to look more closely at the contractual arrangements between the claimant and the garage. Moreover, there will be a need to obtain evidence, not only on the contract made between the claimant and the garage, but also on the likely length of time that a repair should have taken and the circumstances which explain why it took so long.

But this is an interesting point which may yet attract substantial litigation.


7 thoughts on “You just can’t get the parts

  1. Volvo v jubilee motor policies is authority that breach of contract claims are not the same damage as tort and therefore contribution/set-off against a garage cannot be made in credit hire claims,

    1. That’s not what it says at all! That case has nothing to with credit hire, and is based on the Royal Brompton case from 20 years ago. Your better argument is based on Mason v TNT.

      1. You’ll have to send it to me, it was about an insurer though was it not?

        I’ve been successfully citing volvo for years!

      2. And oops – yes I know Volvo was not a credit hire case but it was on the point that tort and contract claims are not of the same kind of damage!

          1. Quite possibly but it is an area of the law in which most people including myself can often fall into error on so i recommend all practitioners should read all that they can!

            PS… no I don’t really believe i get credit hire law wrong- its just everyone else who does!

  2. Interesting stuff, but as you say inapplicable at the lower levels of credit hire as the game is likely not worth the candle. Hypothetically, could you argue duty of care? As in the garage has assumed a duty of care for the Defendant insurer given that they are likely to be the ultimate payer of any costs and bearer of any burden? And that by taking on too much work they are in breach of that duty, with the natural consequence being that repairs in general are delayed and were delayed in a specific case?

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