The matter of Ali v HSF Logistics Polska SP ZOO.
Written by Chris Razmovski
The 2023 UK High Court decision of Ali v HSF Logistics Polska SP ZOO has provided an analysis of the relationship between illegally driven vehicles and credit hire claims, with the argument of causation providing footing for insurers to mount a defence.
Background
Following a motor vehicle collision, Mr Ali was provided a hire car on a credit basis and incurred hire car charges of $21,588.72. The initial decision made in the lower court dismissed the claim on the ground of ex turpi causa, a concept which prevents damages being recovered when they arise from one’s own tortious actions. In this case, this was the illegal act of driving without a valid Ministry of Transport Certificate (MOT).
In addition, the action failed on causation grounds, with the decision being that the vehicle was in no condition to be on the road and was being driven unlawfully at the time of the accident. It was found that “Mr Ali’s credit hire claim fails because he had no loss of use claim, by reason of not having a vehicle which he was entitled to use on a public highway at the time of the accident by reason of the absence of an MOT certificate”.
The matter was heard in the High Court on appeal, with his Honour Justice Spencer agreeing with the previous decision handed down.
Analysis and Application
Whilst not a binding decision for Australia, this case could hold a persuasive precedent among the Courts in respect to the issue of causation.
As is mandatory in the UK, all vehicles are required to hold a valid Ministry of Transport Certificate, which confirms that the vehicle meets the minimum acceptable environmental and road safety standards at the time of the test. The broad equivalent would be a vehicle’s roadworthy status in Australia.
The implications of this case are important in the context of the motor insurance industry and demonstrates further avenues to combat credit hire claims. In particular, where motor insurers become aware that a third party’s vehicle was being driven in unlawful circumstances, it may be possible to successfully avoid a third party’s credit hire claim on the basis the third party did not, in fact, suffer any loss of use.
With credit hire claims increasing, in some claims, questions have arisen about older vehicles damaged in accidents that were arguably not fit for road use. This is ultimately a matter for evidence and a question that should be posed to the necessary expert assessors.
Moving forward, there is the potential for assessors to give evidence, in appropriate matters, of a vehicle’s ‘roadworthiness’ based on the age and condition of the vehicle prior to it sustaining the damage caused by the collision. This evidence could form the basis for an argument that the third party should never have incurred the hire car charges as their vehicle should not have been on the road to begin with.
Should you wish to discuss further, please contact Chris Razmovski, Virginia Waters or any member of our team on 03 9947 4500.
