Introduction
This opening contextualizes the Stevens v Equity Syndicate Management (2015) case, which highlights the duty of claimants to mitigate their losses in legal claims.
One of the foundational concepts in litigation cases is the notion of recovering full value for your claim; that is to say that as the claimant, you need to do what is reasonably within your power to limit the financial damage caused by your situation.
This duty is critical in personal injury cases — particularly involving credit hires vehicles. The Stevens case demonstrated the benefit of using insurance of the injured party or borrowing a car from friends or family at little cost instead of credit hire vehicles.
This paper canvasses some of the ramifications of the Stevens decision and the overarching need to hedge against losses in litigation, thereby enabling claimants to contemplate practical and albeit, complex challenges.
Background on Credit Hire Vehicles
Credit hire vehicles are integral to motor vehicle accident related legal proceedings in boosting the mobility of claimants whose vehicle gets immobilized after a motor unit accident.
Specialized credit hire companies provide these vehicles to keep your lives going while your car is being fixed or replaced.
Provided at no upfront charge to the claimant, credit hire vehicles play a key role in maintaining access to transportation, especially where the claimant is not to blame for the accident.
Even then, the use of credit hire vehicles does not come free of charge, and costs are further compounded in terms of hire length and type of car provided. Knowing how credit hires vehicles work is critical in dealing with the maze of legal claims which follow motor vehicle accidents.
Definition and Purpose
A credit hire vehicle is a replacement vehicle supplied to motorists involved in a motor vehicle accident where the cost of the replacement vehicle is recovered directly from the at-fault party’s insurance company, rather than from the policy of the innocent party.
Their aim is to keep the claimant mobile so that they will not be affected by the fact that they are without their own vehicle; Credit hire vehicles are also unlike usual car hire vehicles as they are supplied on credit, i.e. the claimant should not pay for the hire of the replacement car upfront. Instead, the cost of the hire is usually payable by the other side’s insurance, or as part of the claim for damages.
Credit hire vehicles exist because the overall premise is to mitigate the inconvenience to the claimant’s everyday life by providing them with a vehicle equivocal to that which they were using when said vehicle has been rendered un-roadworthy due to the accident.
Indeed, this helps make sure that the people can still have them that they can go to work and keep their normal activities without any big hassle and no money accounted to be spent.
Common Scenarios
In almost all circumstances after a motor vehicle accident, this is one of the most common situations where credit hire vehicles are used. A typical scenario would be for the claimant whose car has damage caused by the fault of a third-party.
Credit Hire Vehicle
In such cases, the claimant choose a credit hire vehicle given that they is able to afford one and does not prefer to forget about the transportation whilst his / her car stays on repairs.
Credit hire vehicles may also be selected if the claimant’s vehicle has been assessed as roadworthy, or the vehicle is not safe to drive as a result of the accident. Now, you have this operationally automated service model that means people can still get around every day using the most convenient mode of their choosing.
Not only that, but credit hire vehicles can be particularly useful when the claimant’s own vehicle is out of action for large-scale repairs or waiting for parts, helping to keep them on their feet and not disrupt their routine.
On the whole, credit hire vehicles can provide easily the eventual service in relation to after accidents, helping those involved in recover from any crash injuries and get things back to normal as quickly as potential in some circumstances
Importance of Mitigating Losses in Legal Claims
The fundamental principle that parties must mitigate their losses in the context of legal claims is one of fundamental importance in achieving the fair resolution of disputes.
Mitigation: when a person takes reasonable steps to reduce consequences of a certain situation or event on their personal finances. With respect to legal claims, especially those that seek damages or compensation, claimants are obligated to mitigate (i.e. to reduce) the losses to the best of their abilities.
The connected set of principles, represent the claimant to have a duty to mitigate, so as to not unreasonably add to their loss, where the party in breach, assets the claimant has failed to mitigate meaning, the claim should be reduced by the level of reasonable steps, the claimant could have taken.
If claimants can mitigate their losses by actively working to do so, i.e., seeking medical treatment, considering more affordable options, they are evidencing their commitment to allowing a reasonable outcome.
The consequences of not mitigating your losses can be severe; it could mean a lower award of damages or even the claim being struck out! As such, the reduction of loss in legal claims serves the ends of justice and can help to reconcile the different claims of fairness, efficiency, and accountability in dispute resolution.
Conclusion
This avoids the problem of the claimant failing to act sensibly to mitigate their loss as per Stevens’s v Equity Syndicate Management (2015) and can be seen as the final deterrent of the credit hire model.
As this paper has discussed, the basic principle that claimants are required to take reasonable steps to mitigate losses in legal claims is a central tenet designed to ensure fairness and efficiency in dispute resolution.
The Stevens case provides a stark reminder of this responsibility, noting the potential need of claimants to leave no stone unturned in terms of finding ways to ameliorate their financial exposure.
Claimants who accommodate for the lapse by, for example, using their own insurance policies, sharing vehicles with friends or family after a collision or theft, or otherwise showing that they have taken action to prevent further loss can demonstrate their commitment to avoiding or reducing losses, while still ensuring use of the necessary vehicles.
Yet it is also important to recognize the real-world hurdles and circumstances to finding solutions that make economic and practical sense; not to mention the potential legal peril that could result from failing to do so. The Stevens case should provide important lessons learnt for not only legal practitioners but also claimants, navigating the difficulty of mitigating losses in a personal injury claim practically.
At the end of the day, with this formula, claimants can participate in a fair legal system and take appropriate cost-efficient methods and decrease the impact and resounding issue of balance. Justice for all.
