Zurich Insurance Plc v Umerji
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
- LORD JUSTICE MOSES
- SIR ROBIN JACOB
Areas of Law
- Tort Law
- Civil Procedure
- Insurance Law
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
AI Generated Summary
The case involved the Claimant seeking damages after his car was written off in an accident. The Claimant rented a replacement car for 591 days at a high cost due to his inability to replace the car promptly. The lower court awarded him significant damages, which the Defendant appealed. The appellate court held that the Claimant was debarred from relying on impecuniosity to justify the long rental period, but allowed the storage charges claim. The case clarified the legal principles around the recoverability of costs and the impact of impecuniosity on damages.
Judgment
Lord Justice Underhill :
INTRODUCTION
The Claimant, who is the Respondent to this appeal, is a train guard. He lives in Bolton. He was the owner of a Mercedes car, first registered in February 2007. It was worth about £8,000. On 19 October 2010 he was involved in an accident and his car was damaged. It was in due course assessed as a write-off. The other driver was the First Defendant, who is not a party to this appeal. The Second Defendants, who are the Appellants, are the First Defendant’s insurers.
The car was apparently undrivable following the accident. The Claimant contacted a company called Elite Rentals (Bolton) Ltd. He entered into a credit hire agreement with them of the familiar kind, under which they rented him, from the following day, a replacement car for a maximum period of 89 days. Over the next year and a half he entered into a series of further agreements in substantially the same terms (though not always for the same vehicle) until 2 June 2012 – a total period of 591 days. The rental for that period was £95,130.14 (representing a rate of about £161 per day) – a remarkable sum given the value of the damaged car. The Claimant says that he was unable to afford to buy a replacement vehicle until the Appellants paid him the pre-accident value of his old car. That did not in fact happen until 16 November 2012. It does not matter for present purposes why the Claimant ceased to hire a replacement vehicle some five months before that date: probably Elite became nervous about extending any further credit.
Elite also arranged for the recovery of the damaged car and its storage. It remained in store for over four months, until 22 February 2011. The recovery and storage charges came to £3,420.75.
It was a term of the credit hire agreement that the Claimant agreed to Elite appointing solicitors to pursue a claim in his name against the First Defendant and that he would co-operate in that claim. A firm called M&S Legal were duly instructed, apparently on the day of the accident itself. They notified the Second Defendants of the Claimant’s claim in accordance with the pre-action protocol.
After some correspondence, of which I need not give the details here, proceedings were initiated in the Claimant’s name in the Manchester County Court on 24 August 2011. The First Defendant did not file a defence and a liability judgment was entered in default on 6 October. It appears that he had not notified the Appellants of the proceedings, and on 11