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Published 1 abril 2016
Credit hire is back in the national press, following a £236,724 claim being dismissed due to lack of need.
His Honour Judge Armstrong clarified the requirement of the pre-action protocol to encourage the parties to understand each other's position and try to settle the issues without proceedings.
The Defendant successfully obtained summary judgment dismissing the Claimant's hire claim as having no need for hire as a result of the pre-action conduct of the Claimant's Solicitors and evidence obtained showing the Claimant had no real prospect of succeeding at a final hearing.
The Claimant hired a Ferrari California Convertible from Accident Exchange for a total of 219 days at a cost £236,724.00. The Defendant sought summary judgment, arguing that the Claimant had no need to hire after having made direct enquiries of the Claimant's insurers who confirmed the Claimant had 5 other vehicles available to him with the vehicle in question being insured for 1000 miles a year only. The Claimant's mitigation statement confirmed he needed the hire vehicle for domestic use, as well as commuting to work. However, the insurance policy for the vehicle damaged in the accident confirmed the vehicle was not insured for work purposes.
The Claimant failed to confirm his need for hire despite numerous requests by the Defendant's representatives over a period of 18 months.
The Claimant appealed the successful application for summary judgment, but leave to appeal was refused. His Honour Judge Armstrong reaffirmed that need is fact specific and should be decided on "an assessment of the relevant circumstances in a particular case".
The existence of an available alternative motor car does not automatically preclude a Claimant from establishing a possible need, neither does the fact the car in question being described as luxury preclude a Claimant from hiring. It is open to a Claimant to put forward cogent reasons for the specific need for the replacement vehicle in question.
HHJ Armstrong found that the case was correctly dismissed at the summary judgment hearing. The history of the case and the Claimant's "clear failure" to comply with the Pre-Action Conduct Practice Direction coupled with the Defendant's evidence supported the Defendant's application for summary judgment which was correctly used in the District Judge's decision.
Although this is an extremely positive case for Defendants, we advise caution is used when considering to apply for summary judgment. A Court will only grant summary judgment if there is an absence of a real prospect of success. If a Claimant has an arguable case for need, summary judgment is likely to be refused, with a trial being required to hear both sides of the argument.
Frankland does however provide some useful litigation tactics:
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