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Anna Wilkinson

The Cost of Hiring with Zero Excess

William Lawson v Natasha Mullen

Anna Wilkinson, an experienced member of the Park Square Barristers credit hire team and also the nationally-renowned civil fraud team, discusses the latest claim in the battle between credit hire and insurance companies as to the costs recoverable in such claims, on this occasion focusing on the zero excess arguments.

HHJ Freedman, designated Civil Judge at Newcastle Upon Tyne County Court, gave this judgment on an appeal from a decision of DJ Howard sitting at the Morpeth County Court. This is another one for those of us who regularly defend credit hire claims to add to that ever-increasing pile of authorities that we carry around the County Courts across the country!

This case concerned the regularly encountered situation in which the Claimant hired a zero excess credit hire vehicle but the Defendant’s basic hire rates produced for comparison carried a significant excess. HHJ Freedman rejected the submission that as a matter of law a Claimant is always entitled to recover the cost of a vehicle with zero excess. Rather a Claimant will only be able to recover the cost of hiring such a vehicle when it was reasonable for him to do so.

Case background

The claim arose out of a road traffic accident which occurred on 15th July 2014. The Respondent drove into the rear of the Claimant’s vehicle. Liability was never in issue. The matter came before DJ Howard for a determination of hire charges and other incidental expenses. The claim was for hire charges of £7,384.05, being the amount changed by On Hire Limited under a credit agreement. There was no issue as to the need for a replacement vehicle. The Appellant did not seek to rely on his own impecuniosity.

Case issues

There were two issues before the District Judge, The period of hire and the appropriate rate. The DJ found that a 28 day period was reasonable but refused to allow the rate charged by the credit hire company and relied upon basic hire evidence produced by the Respondent. The BHR was £2500.12 for the full 28 day period. He also allowed the cost of excess reduction, whereby the excess was reduced to £500, which amounted to £11.99 per day and the cost of an additional driver at £10 per day. The DJ noted that the rental from On Hire Limited provided for a nil excess. In short, the Appellant had hired a vehicle which cost £153 per day more than the equivalent local basic hire rate in order to avoid the risk of having to pay out a £500 excess charge were he to have an accident in the hire vehicle. DJ Howard had found at first instance that in doing so the Claimant’s actions were not reasonable.


During the appeal HHJ Freedman considered several authorities, the analysis of which may be useful for practitioners. He found that a Claimant, as a matter of legal principle, “does not have an inalienable right to hire a vehicle with a full waiver excess”. He said in many situations it may be reasonable for a Claimant to obtain a replacement vehicle with a nil excess but where, as in this case, there was a gross disparity between what the credit hire company charged and the basic hire rate, with the only additional advantage being the waiver of a £500 excess the test to be applied is one of reasonableness and if the Defendant can show that the Claimant has failed reasonably to mitigate his loss then the hire charges claimed would not be recoverable.

It is worth noting that Counsel for the Respondent argued that any excess payment such as would have been due in the event of an accident would, in any event, have been recoverable from the Defendant as part of the on-going claim as it would not have been incurred “but-for” the original tort. HHJ Freedman did not rule on this argument but it is one to bear in mind.

Of course this is only a County Court decision but an appellate decision from a DCJ and should certainly be persuasive in defending a Claimant’s argument that your BHR evidence is not “like for like” in respect of the excess waiver.

By way of a side point, there are now a number of products on the insurance market which specifically insure against paying the excess incurred on a hire vehicle (many people use them when hiring abroad and many are under £50 for an annual premium). Whilst it may be difficult for an insurance company to argue that a Claimant should have known about such products and utilised one, an insurance company, particularly one which has received an RTA1 CNF with the identity of a hire company known for their high CDW charges, would be well advised to immediately write to the Claimant’s solicitors, remind them of their clients to reasonably mitigate their loss, to highlight this much cheaper product, and to ask the Claimant to switch. I would imagine a Claimant who thereafter entered into a second 89 day hire agreement with the CDW would have some difficulty before the Court.

Anna Wilkinson is an experienced practitioner in the Park Square Barrister civil and civil fraud teams, with particular expertise in credit hire cases. She can be contacted via her clerks Francine Kirk and Talia Webster.