Stevens v Equity Syndicate Management Ltd

In a credit-hire claim, an impecunious claimant may recover the reasonable additional cost of credit hire, but impecuniosity means an inability to pay ordinary hire charges without an unreasonable sacrifice or burden. A claimant who can pay upfront is generally limited to the Basic Hire Rate for the vehicle actually hired. That rate is determined objectively from locally available ordinary-hire rates and is not obtained by averaging rates or automatically selecting the highest rate. The claimant must take reasonable steps to mitigate loss, but need not search every possible provider. A period of hire is recoverable where the vehicle was undergoing genuine repair activity and delay awaiting parts was not caused by mere inaction.

The claimant appealed against a Recorder’s assessment of damages following a road accident for which liability was admitted. The claim concerned credit-hire charges while the claimant’s Audi was repaired. The Recorder found that the claimant was not impecunious, assessed a Basic Hire Rate of £75.62 per day by averaging local rates, and allowed 19 days’ hire, excluding nine days before repairs began.

On appeal, the claimant challenged the findings on impecuniosity, the method of calculating the Basic Hire Rate, and the reduction of the hire period. The central issues were the proper measure of loss for a non-impecunious credit-hire claimant and whether the initial period at the repair garage represented a failure to mitigate.

1. Appeal allowed in part. The claimant was entitled to a further nine days’ hire at £75.62 per day. The finding that he was not impecunious was upheld, and no further order was required in relation to the Basic Hire Rate.
2. Impecuniosity means an inability to pay ordinary hire charges without making sacrifices or accepting a burden which it would be unreasonable to expect the claimant or his family to bear. The Recorder was entitled to assess the claimant’s means from the available bank statements. Their sustained positive balances, together with the absence of persuasive evidence of wider financial pressure, supported the finding that he could have paid ordinary hire charges.
3. For a claimant able to pay ordinary hire charges upfront, the recoverable loss is the Basic Hire Rate for the replacement vehicle actually hired. The court must identify that rate objectively from actual locally available ordinary-hire figures. Averaging rates is not the correct approach, and the highest disclosed rate is not automatically recoverable. The claimant must take reasonable steps to mitigate loss, but need not contact every provider.
4. The initial nine-day period was recoverable. The vehicle was stripped to identify the required work and parts, which arrived later. This was genuine repair activity, not a case where the vehicle was simply left at a garage while nothing was done. The claimant and Accident Exchange, acting as his agents for this purpose, had not failed to mitigate their loss.

• High Court (Queen’s Bench Division): appeal from the Recorder’s order dated 24 May 2013. The appeal was allowed to the limited extent that nine further days’ hire were recoverable.