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Supreme Court put the brakes on credit hire claims

With the influx of credit hire claims, a question has arisen over the years regarding the proper assessment of damages where a motor vehicle, damaged in a ‘not at fault’ collision, is unavailable for use while the ‘not at fault’ vehicle is being repaired or replaced. 

There is no doubt that where a person’s vehicle is damaged they are entitled to something, however, the gates of the Local Court have been flooded with claims where a vehicle is provided on credit to the ‘not at fault’ party.

The business model of credit hire arrangements focuses on the credit hire company providing credit for the cost of the vehicle over the period of hire while taking the expense and responsibility - win or lose - of pursuing the claim. This model has generally resulted in increased hire costs claimed against insurers by such companies when compared to the mainstream rental market.

Several matters were taken on appeal in the hope of resolving this aspect of the assessment of damages for these types of claims. But was this really a novel argument or rather something finally laid to rest?

On 3 September 2019, Basten J of the Supreme Court of New South Wales sought to clarify the position.    

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