West Midlands Travel Ltd v Aviva Insurance UK Ltd [2013] EWCA Civ 887 (18 July 2013)

West Midlands Travel Ltd v Aviva Insurance UK Ltd [2013] EWCA Civ 887 (18 July 2013)

The proper basis for assessing general damages for loss of use of a public service vehicle is normally interest on capital value (if owned) or the daily hire rate (if leased), together with depreciation and expenses thrown away. The standing charge approach, allocating a proportion of total business overheads, is not appropriate unless the claimant can show actual marginal costs directly attributable to the loss of the specific vehicle.

Citation
[2013] EWCA Civ 887
Parties
Claimant/respondent: West Midlands Travel Ltd; Defendant/appellant: Aviva Insurance UK Ltd
Jurisdiction
England and Wales
Judgment Date
18 July 2013
Procedural Posture
Civil Appeal / Appeal From High Court Judgment
Outcome
Appeal allowed; case remitted for reassessment of damages.
Legal Topics
Damages for Loss of Use, Assessment of General Damages, Road Traffic Accidents, Public Service Vehicles, Standing Charges, Interest on Capital, Depreciation, Expenses Thrown Away
Tort Law Insurance Law Damages for Loss of Use Assessment of General Damages Road Traffic Accidents Public Service Vehicles Standing Charges Interest on Capital +2 more

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Parties

West Midlands Travel Ltd

Claimant/respondent

Aviva Insurance UK Ltd

Defendant/appellant

Procedural Posture

Civil Appeal / Appeal From High Court Judgment

Legal Issues

  1. 1 Whether general damages for loss of use of a public service vehicle are recoverable when no special damages can be proved
  2. 2 What is the correct method for assessing general damages for loss of use: standing charge or interest on capital/depreciation/expenses thrown away

Ratio Decidendi

The proper basis for assessing general damages for loss of use of a public service vehicle is normally interest on capital value (if owned) or the daily hire rate (if leased), together with depreciation and expenses thrown away. The standing charge approach, allocating a proportion of total business overheads, is not appropriate unless the claimant can show actual marginal costs directly attributable to the loss of the specific vehicle.

Court Disposition

Appeal allowed; case remitted for reassessment of damages.

Orders

  • High Court judgment set aside as to damages assessment.
  • Case remitted to High Court for damages to be assessed in accordance with the principles set out in the judgment.