There have been some recent developments in the Small Claims Division on the issue of credit hire.
Unlike the decision of Pham v Rahman, where the Assessor accepted tiered rates for the hire of a replacement vehicle, in Hayes v Batesman the Court did not accept the tiered rates in the assessment of loss. However, this matter was decided on the facts following the cross-examination of an employee from a rental company. Hayes v Batesman left it open for a the Court to accept tiered rates if the appropriate evidence was before the Assessor.
Last week a judgment was handed down in the matter of Gary Ross v State Transit Authority. In this matter, the Assessor said that the distinction between special and general damages is now an important one, and assessed this claim as a general damages claim (as general or special damages was not specified by the Plaintiff). The Assessor found that in assessing general damages the Plaintiff needs to prove 'need' for the replacement vehicle and said the issue of 'need' was not self-proving. On the evidence, the Plaintiff did not sufficiently prove he needed a replacement vehicle and therefore the Assessor found his damages should not be assessed by reference to the market rates of a comparable vehicle. Rather, the Assessor calculated damages by applying interest on the capital value of the plaintiff's vehicle plus registration costs. The Plaintiff's claim sought $5,659.50, however the Assessor awarded him $116.87, with an order for the Plaintiff to pay the Defendant's costs (based on an offer served).
This decision demonstrates the changing attitude of the Assessor to credit hire matters and the assessment of damages. Since Ritz v Chen, the landscape in the Local Court has shifted away from awarding exorbitant rates of hire for credit hire providers.
In addition to the Assessor being open to a shift in the assessment of damages credit hire matters, the Assessor has also criticised the practices of filing for default judgment when parties have been in correspondence about the claim prior to judgment being entered. This has been a procedural issue faced often when dealing with credit hire claims.
Recently, a motion was filed in the Small Claim Division of the Local Court seeking to set aside a default judgment which was entered after there was correspondence between the parties. The correspondence related to a request for particulars of the Plaintiff's claim, which was a claim for credit hire, as to whether damages sought were special damages or general damages. The Plaintiff's solicitor maintained this was not a proper request, and ultimately filed for default judgment. The affidavit in support of the default judgment said nothing about the correspondence between the parties. The Defendant's solicitor argued that the duty of candour that solicitors owe to the Court extends to include all dealings with the Court, and as such there was a duty for the Plaintiff's solicitor to have included the full reasons why a defence was not filed. Correspondence between parties should have been included in the affidavit in support of the motion for judgment. The Assessor agreed and set it aside with the Plaintiff's solicitor to pay the Defendant's costs.
In the same hearing of the motion, an issue was raised with the Plaintiff's solicitor filing for default judgment as a liquidated claim, not an unliquidated claim (as an unliquidated claim would need to have the damages assessed as they would be in a hearing disputing quantum). As such, the Defendant's position, now that default judgment was set aside, was that the claim should now be one for special damages (as the Plaintiff filed for judgment on a liquidated amount) not general damages. If the claim was locked in as special damages, then the Defendant is entitled to request particulars of a special damages claim, such as need, the Plaintiff's financial position , and a range of issues going to mitigation and reasonableness, which are considered when assessing special damages claims. We understand this point has not yet been determined.
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