Judge awards just £1,200 after credit hire firm claimed £50k

A leading credit hire firm is considering appealing a decision to award just £1,187 from a claim of more than £50,000. 

District Judge Lumb said there had been an ‘unravelling of the claims process’ adopted by Newcastle firm Winn Solicitors and its credit hire subsidiary, On Hire Limited.

This was caused by mistakes made by the claims-handlers and fee-earners that emerged during oral evidence from the firm’s client David Wiltshire.

Lumb said in Wiltshire v Aioi Nissay Dowa Insurance Company of Europe there had been a ‘stark contrast’ between the account given in oral evidence by the claimant and the witness statement prepared for him by solicitors.

‘During the course of Mr Wiltshire’s oral evidence, it became obvious that his witness statement was far from being in his own words,’ said the judge. ‘Instead, it followed a template precedent that in the Court’s experience is almost always used by Winn solicitors. The effect of this marked inconsistency between the oral and written evidence rendered the reliability of the contents of the witness statement to be highly questionable.’

Winn has said it is considering an appeal and therefore cannot comment further.

Wiltshire, then 79, had been involved in an RTA in May 2023 where liability was admitted by the other driver. The claim, brought in Wiltshire’s name, was for £50,190 comprising hire charges, collection and delivery, and recovery and storage.

Lumb had already excluded a witness statement from a representative of Winn after the court had not given permission for the claimant to rely on it.

Wiltshire’s written statement had used terms such as credit repair, credit recovery and storage, despite him not even being aware what credit hire was. He told the court he believed he had been speaking to his own insurers, when his written evidence stated he had been speaking to Winn Solicitors. Wiltshire also denied that he was told that Winn’s directors were also directors of On Hire Ltd. At that stage he had never heard of On Hire Ltd.

The judge noted that had the credit documentation been properly completed then the hire claim would have likely succeeded, and the damages awarded much higher.

He admitted that people unfamiliar with credit hire claims may be surprised at the disparity between the value of the claim and the amount awarded. Lumb added that they may also question why the courts have not intervened in this industry, given the effect of such sums on motor insurance premiums.

‘The answer to that may be that the senior courts have exhausted the arguments at common law and only new legislation by parliament could alter the position. Whether that will happen remains to be seen.’

The judgment was the second in quick succession in which Lumb had offered commentary on the credit hire industry and the rate at which disputes over credit hire claims result in the county court. Both times the claimant had been represented by Winn.

In Piercy v Kangethe, the judge had said it might ‘come as a shock’ to the general public how the credit hire industry operates, and in particular the ‘staggering’ sums of money that insurers become liable for.

As in Wiltshire, Lumb said that the claimant’s written statement had been prepared largely based on a template format and signed with an electronic signature. The claimant’s evidence provided insight into 'how an innocent motorist effectively cedes all control to the credit hire company and their solicitors once they commence the process'. It was ‘striking’, added Lumb, how little the claimant in Piercy had been informed about how the claim was proceeding.

The judge said the claim should have been worth £11,000 for 96 days of credit hire but he was bound by the rules on credit hire, meaning he had to award the full claim of more than £55,000.

‘Unfortunately for the defendant, these claims are rarely decided on the basis of what the claimant could have done to mitigate her losses had she known the full circumstances but on the basis of what she did know and any delay has to have been caused by the claimant’s own conduct or actions.’ The claimant’s conduct, he noted, had throughout been ‘beyond reproach’, so the defendant was liable for the credit hire charges as claimed.

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