Fake hire charges exposed

Posted: 7th February 2013

Claims that thousands of road accident compensation cases were infected by falsified evidence have led to an on-going dispute between the car hire industry and motor insurers that is likely to have an impact on insurance premiums for years to come. The Court of Appeal has directed a re-trial of four such cases in the light of fresh evidence relating to the activities of a company, now in liquidation, whose role it was to investigate open market car hire rates on behalf of insurers.

Damaged CarIn the four cases, evidence relating to the reasonableness of car hire charges in respect of replacement vehicles was given by the company’s employees. It is alleged that such evidence, which purported to show that cars were available for hire at cheaper rates than had been obtained by accident victims, was neither reliable nor independent and was based on falsified results of market research that was never in fact performed. That is claimed to have resulted in under-compensation in the four cases, as well as thousands of others.

Directing a re-hearing of the four cases in the light of fresh evidence relating to the company’s alleged malpractice, the Court of Appeal ruled that, despite the antiquity of the claims, the ‘overriding objective’ of fairness to all parties demanded that the level of damages awarded in respect of car hire charges should be-reassessed. The court noted that its reasoning was likely to be of application to a large number of similar cases although re-trial orders would not be automatic and each case would have to be determined on its own facts.