Leased Driver Entitled to Sue Other Driver’s Insurer for Replacement Vehicle Cost

The recent decision by the Sheriff Appeal Court to allow a claim for the cost of hiring a replacement vehicle in a road traffic accident could have far-reaching implications for insurers and those involved in accidents. The case involved a self-employed private hire driver, Robert McGarrigle, who had to hire another vehicle after the car he had leased from a third-party company was damaged in an accident caused by another driver. McGarrigle sought to recover the £8,495.28 cost of hiring a replacement vehicle for 81 days from the insurer of the other driver, UK Insurance Ltd.

Initially, the claim was rejected on the basis that McGarrigle did not have the right to sue, as he was not the owner of the damaged vehicle and had not suffered personal injury or inconvenience as a result of the accident. However, the Sheriff’s Appeal Court overturned this decision, finding that McGarrigle had a legal relationship with the other driver’s insurer as a victim of the accident and was entitled to pursue the claim.

The decision is significant because it expands the scope of claims that can be made by victims of road traffic accidents. Previously, it was assumed that only those who owned the damaged vehicle or had suffered personal injury had the right to make a claim. However, this ruling suggests that anyone who has suffered a loss as a result of an accident, such as the loss of income from being unable to use a damaged vehicle, may be entitled to make a claim.

For insurers, this decision could lead to an increase in claims and higher payouts. They may need to re-evaluate their policies and procedures for handling claims, as well as their calculations for determining the amount of compensation to be paid. For those involved in road traffic accidents, the decision offers the potential for a wider range of losses to be recovered, beyond just personal injury or damage to the vehicle.

Partner Michael McLean who conducted the Appeal Hearing on behalf of our client adds;

At Jones Whyte we are proud to work for taxi and private hire firms and drivers throughout Scotland.

Many of our clients are self-employed taxi and private hire car drivers who hire their licensed vehicle, as opposed to owning it outright. If their vehicle is put off the road by a road traffic accident, they are unable to earn a living – even if the accident was not their fault.

Accident Hire companies enable drivers to hire replacement licensed taxi or private hire vehicles, whilst their vehicle is repaired. This allows drivers to get back working and earning more quickly. The drivers can then pursue compensation from the at-fault driver’s insurers for the hire costs, along with any associated claims for personal injuries or loss of earnings.

In this case, the Sheriff Appeal Court considered whether our client, a self-employed driver, was entitled to pursue a claim for the cost of hiring a replacement vehicle, even though he did not own the vehicle damaged by the accident. The Court confirmed he was so entitled, in principle.

The decision is important because it means self-employed taxi and private hire car drivers in a similar position can continue to pursue their claims. It also means that if they have accidents in the future, they can make Accident Hire arrangements without fear of being left with costs they can’t recover from the at-fault driver’s insurers.

Michael McLean, Partner

As a firm of solicitors, Jones Whyte has settled thousands of road traffic accident claims and understands the importance of ensuring all aspects of a loss are fairly recovered. This ruling highlights the importance of seeking legal advice in the event of an accident, as there may be more avenues for compensation than previously thought. It also emphasises the need for insurers and other parties involved in accidents to have a thorough understanding of the legal implications of such cases.

Are you struggling to recover from an injury caused by someone else’s negligence? The Jones Whyte Personal Injury team has been fighting for justice on behalf of clients for years, and we’re ready to put our expertise to work for you.

With our extensive years of experience handling personal injury claims, we know exactly how to navigate the legal system to get you the compensation you deserve. We understand that every case is unique, and we take the time to listen to your story and tailor our approach to your specific needs.

You don’t have to go through this alone. Our team of dedicated professionals will be with you every step of the way, fighting for your rights and ensuring that you receive the best possible outcome for your case. So why wait? Contact us today for a no-obligation consultation and let us help you get the compensation you deserve.