CREDIT HIRE: HOW TO SWEEP THE RACE

Gavin Renwick
May 29
16 min read

Updated: Sep 24

TRUTH IS ALWAYS THE FIRST CASUALTY IN WAR:

DEFENDANT INSURERS: It is 2025 and it will cost you 207% (two hundred and seven percent) more, to hire a vehicle on credit than it did in 2014. In stark contrast to the number of RTAs falling from 761’878 (2014), to 348’806 (2024) and RPI inflation of 'just' 14.2%; the average daily rate for hiring a vehicle on credit has increased from £69 p/d to £212 p/d across the same period.
THE CREDIT HIRE ORGANISATION: The Trade Body for Companies providing mobility for consumers while their cars are being repaired, found that the maximum daily hire rate in the GTA had increased by just 5.78% on average during last decade.
THE INSURANCE TIMES: Over same 10 year period, the average total invoice for hiring a vehicle on credit, increased 500% i.e. from £1’105 to £5’240.

Regardless of where your loyalties lie, hiring a vehicle on credit and claiming the cost from another person's insurer remains controversial. As we saw in our previous article, doing so incorrectly can leave you insolvent.

FOREWORD

This article which is our 2nd in Credit Hire outlines the basic legal test for proving the claim.

As in English Law it is always the claimant's case to prove, this article is written from the perspective of a claimant. However, defendant's should find it equally as useful when considering fight or flight.

This article does NOT apply to taxi drivers whom have hired a replacement taxi on credit. In those cases, a different set of legal principles i.e. 'loss of use of a profit earning chattel apply which will form the subject matter for subsequent articles.

AS ALWAYS; nothing in this article constitutes legal advice and you are referred to our terms and conditions for use accordingly.

SUMMARY

In a concise summary: the evidential hurdles a claimant will need to prove are as follows:

Below we set out the considerations and list the evidence required to prove each step of the credit hire claim. For ease of reference, this have been done in expandable format. For the solicitors, we have also listed cases that should be considered at each step of the claim.

Terminology:

In this article only, we use the following terms and descriptions:

Damaged Vehicle: The claimant’s vehicle damaged in an RTA.
Hire Vehicle: The vehicle the claimant hired on credit.
Spot Hire: Paying up-front/daily rate to hire a vehicle NOT on CREDIT i.e. ‘hire on the spot’.
Courtesy Car: Any vehicle that may be offered by a third party e.g. an insurer, as an alternative.
Opposing Insurer: This is the insurer for the other vehicle often referred to by way of ‘Third Party’. As a credit hire claim can have several ‘third parties’ we prefer ‘Opposing Insurer’.
BHR: Basic Hire Rate Evidence. This is evidence of what it would have cost to pay for the Hire Vehicle on the spot/upfront instead of on credit.

PRELIMINARY: ARE YOU A CAR THIEF?

EVIDENCE: Required in support of ownership:

V5 or V5C Logbook from the DVL
UK Drivers License

Solicitors practicing in civil law are often surprised when car-criminals come into their office and fail to introduce themselves as such (rude). Recalling a conversation we had in Manchester 2012: “Well you wouldn’t [be] f**king ask me if I owned the car if it was mine would you? … What do you mean was I allowed to drive it? Yes mate I waited in the f**king rain and asked nicely before getting in. It was all nice and VERY polite.”

The above indicated that the man whom had been driving the Damaged Vehicle may not have been its owner/registered keeper OR, even had permission to drive it. It follows; that if the claimant did not own the Damaged Vehicle and did not have permission to drive it then he has not lost an asset that required replacing. Consequently, that car-criminal’s prospective claim being that 'but for the RTA, he had no choice but to hire a vehicle on credit for work, social and domestic purposes’ would fail.

1. LEGALITY: WAS YOUR CAR LEGALLY ON THE ROAD?

EVIDENCE: Required to prove that the Damaged Vehicle was legally on the road at the time of collision.

MOT Certificate for the Damaged Vehicle
Certificate of Insurance for the Damaged Vehicle

Once satisfied that the Claimant is the owner/registered keeper and/or had permission to use the Damaged Vehicle (hereafter, the driver is simply ‘the Claimant’), you will need to prove that the Damaged Vehicle was legally on the road. In general, the law does not allow a claim for the recovery of repair costs or the hire of a replacement vehicle, if the Damaged Vehicle should not have been on the road to begin with.

There have been some recent developments in this area with Majid Ali -v- HSF Logistics Polska SP. Z O.O [2024] [11] where in some limited circumstances, a claimant whom was on the road illegally can claim for hiring a replacement vehicle. This will form the subject matter of a subsequent article but in general, the longer the Damaged Vehicle has been on the road illegally the less likely any judicial discretion will be exercised.

2. NEED: DID YOU REALLY NEED TO HIRE A VEHICLE?

EVIDENCE: Required to prove that you really needed to hire the Hire Vehicle:

Witness Statement: Occupation, Mileage, Family/Personal Circumstances, Social Commitments and Any Other Vehicles in the Family?

‘Need’ is not ‘Want’ nor is it Self-Proving. The court is not going to order someone else to pay the Claimant’s hire charges unless you can give the court a good reason for why you needed the Hire Vehicle. This requires evidence i.e. a witness statement from you explaining/evidencing why you needed the Hire Vehicle? There is no set criteria for the evidence required which is fact specific. But we would ALWAYS suggest you put into evidence:

Occupation: Do you need a vehicle to travel to work e.g. delivery driver?
Mileage: How far do you need to drive and how far did you drive in the Hire Vehicle?
Family: Do you need to drop your kids off at school? Or your spouse to work? Are there social commitments such as visiting elderly relatives?
Alternative Vehicles: If every member of your household has their own vehicle, you should explain why incurring e.g. £10’000 in hire charges was more reasonable than asking your younger brother to drive you into town on a Friday Evening? Alternatively, if you have crashed a ‘company car’ you must explain if it formed part of a fleet of vehicles.
Your Injury: It is not uncommon for claimants involved in RTAs to suffer an injury which can be both physical and psychological. Consequently, should a medical expert have diagnosed you with ‘Fear of Travel.
Social Commitments: A Reasonable Person is not expected to resort to hermitage to mitigate their loss. Your social commitments i.e. visiting elderly relatives, their shopping, clubs, societies etc are collectively, evidence of ‘Need.’

NEED: For the solicitors:

Giles -v- Thompson^[1]:- Need is not self-proving.
Beachwood Birmingham Ltd -v- Hoyer Group UK Ltd [2]:- Access to other vehicles.
Singh -v- Yaqubi [3]:- Fleet Vehicles.

3. ENFORCEABILITY: DO YOU HAVE AN ENFORCEABLE CONTRACT?

EVIDENCE: Required to prove an enforceable Credit Hire Agreement:

Credit Hire Agreement: Preferably signed and dated.
Notice of Right to Cancel
Witness statement: Offer, Acceptance, Consideration, Conversation and Location.

In general, a credit hire agreement does NOT fall under the Consumer Credit Act 1974 unless firstly, the contract specifically provides for this, or secondly; it exists for longer than 3 months i.e. ‘the Duration Route.’ Instead, the usual contractual principles apply and as a ‘contract,’ for it to be legally binding/enforceable you should evidence in your witness statement:

Offer: How did you hear of the hire company and contact them? What was discussed? What did the hire company say? Were you shown the Terms and Conditions of Hire in advance and did you agree them? If you were not shown any terms and conditions then how was the vehicle offered to you and on what basis?
Acceptance: Did you sign the contract in the Hire Company Office? Did you sign it online? Did you sign the contract prior to starting the hire or did you sign it afterwards?
Consideration: In ‘Contract Law’ this refers to the price/cost of purchase. Did you agree the hire charges prior to agreeing the contract? If not, did you agree to pay the hire company at all? Please note, should the contract indicate that someone else is ultimately liable for the hire charges e.g. the insurer for the other driver, then it will not be legally enforceable unless the payer agreed to it.
The ‘intention to create legal relations’ is implied but it is worth checking that the Claimant has mental capacity. The author recently attended trial where the Claimant sought to rely upon a variety of mental conditions to escape a finding of fundamental dishonesty. I am pleased to report his Honour was sufficiently satisfied that my client (an active Civil Servant) was stark-raving mad but good enough to carry on as a civil servant on the public payroll.

WHERE WAS THE CONTRACT SIGNED? NOTICE TO CANCEL?

When giving evidence as to ‘Acceptance’ where the contract was signed is significant. From 13 June 2014 the Consumer Contracts Regulations 2013 replaced both the Consumer Protection (Distance Selling) Regulations 2000 and the Cancellation of Contacts made in a Consumer’s Home or Place of Work etc Regulations 2008. Reg.13 sets out the steps which must be taken and the details provided before entering a contract. Specifically, there should be a ‘Notice of a Right to Cancel’ allowing the Claimant to terminate the contract within 14 days.

ENFORCEABILITY: For the solicitors:

Wei -v- Cambridge Power and Light Ltd [4]- Should the Credit Hire Agreement be found to be unenforceable then the claimant may be able to recover basic hire rates.
Tyrell -v- Stainforth [5]:- Electronic Signatures.
W -v- Veolia Environmental Services (UK) Plc [6]: - Subrogated Claims.

4. MITIGATION:- DID YOU ATTEMPT TO CUT YOUR LOSS/THE COST?

EVIDENCE: Required in support of Mitigation:

Witness Statement: Exhibit Searches for other hire vehicles.
Witness Statement: Was Public Transport available? Could you have borrowed or shared another vehicle? Were you ever offered a courtesy car from the repairing garage? Did you try or continue to drive your damaged vehicle up to when it was repaired or scrapped? Did you return the hire car when not using it for 1 day or more e.g. when on holiday? Did you hire a vehicle that was similar as opposed to an upgrade? Did you return the hire car as soon as your vehicle was repaired or did you let the hire charges stack up?

There is a general duty to mitigate on all parties. That not only means a party should not deliberately or carelessly inflate their claim but also seek to stem/cut their loss. In the simplest of terms, what the court wants to see is that in keeping with the metaphorical ‘Reasonable Person’, you:

Hired a Like-for-Like Vehicle: The Reasonable Person would not hire a Lotus Emira sports car on credit if they could not afford to repair or replace a Toyota Prius. Should you have decided to get into excessive debt because you wanted a temporary upgrade to your car and are now claiming for someone else to pay for it, then you need to explain/evidence this in your witness statement. At best without good reason, the court will allow you to recover the charges for a like-for-like vehicle. E.g. This was the closest car like mine that was available.
Utilised Alternative Transport: The Reasonable Person would at first consider utilising public transport or sharing a vehicle before getting into substantial debt by hiring a vehicle a vehicle on credit. Should you have attempted this before hiring a vehicle you evidence/explain this in your witness statement as it gives you a very strong case.
Courtesy Car: A Hire Vehicle is not a Courtesy Car. It is not free. The Reasonable Person if offered a vehicle that is completely free, would be expected to take it rather than get into excessive debt by hiring a vehicle on credit and then beg someone else to pay it. Should you have turned down the offer of a Courtesy Car then you will need to explain/evidence this in your witness statement e.g. the Courtesy Car could not be provided for another 14 days and I needed a replacement immediately?
Period: The Reasonable Person when getting into debt of £250 - £550 p/d, would not HIRE longer than needed i.e. needlessly increase the debt. This is discussed in more detail below.
Co-operation/Responding: The Reasonable Person would co-operate with the opposing insurer by providing updates and allowing inspection. Being involved in a RTA can cause physical and psychological trauma, financial loss and plagues of inconvenience. In that context, being called a liar by the other guy’s insurer is incredibly aggravating. BUT, this is civil litigation and the parties are expected to try and resolve their dispute without using court resources. So, if you have refused to allow inspection of your vehicle and/or failed to provide information to your opponents, you should evidence/explain this in your witness statement.
ABI General Terms of Agreement (GTA): The Association of British Insurers have a ‘General Terms of Agreement’ with various credit hire organisations. A lay individual does not need to concern themselves with these. However, where applicable subscribers should evidence that they have complied with the agreement. A separate article will cover this.

MITIGATION: For the solicitors:

w Copley -v- Lawn[7]- Offer of an alternative vehicle.

5. IMPECUNUIOSITY: - WERE YOU IMPECUNIOUS?

EVIDENCE: Required to prove impecuniosity:

Particulars of Claim: This should plead specifically that “The Claimant was impecunious.” AND: set out in detail why the Claimant claims to be impecunious?
Reply to the Defence: Should the Defendant challenge the assertion that you are impecunious, set out in a Reply exactly why they are wrong and what evidence you will serve.
Financial Documents: The Court will list the documents required to prove a plea of impecuniosity in a ‘Debarring Order’ Speak to your solicitor urgently about this. Should you not be advised of any such Order contact the court and then prepare from 3 months prior to the commencement of hire to the end of the hire period, the following:
Bank Statements including credit cards
Self-Employed: Self-Assessment for the tax year hire commenced and/or Proft and Loss accounts.
Wage or other Slips.
Adverse Credit Individuals: Experian Searches, CCJs, Criminal Records, loan rejection letters or equivalent.

Impecuniosity literally means that you are penniless. In the context of claiming credit hire charges, you were at the time of your collision unable to afford to repair your damaged vehicle or hire/pay for a replacement on the spot. Consequently, you had no choice but to hire on credit.

There is extensive case law around what amounts to impecuniosity, but it is ultimately fact-specific. What a District Judge (and they are not accountants or trained in financial matters) must be able to do on the day of the trial, is to review your financial records and be able to make an honest assessment as to whether or not you could afford to pay? If you do not disclose all your financial documents then no reasonable person on Earth, can honestly say what you could or could not afford?

BASIC HIRE RATE (BHR) EVIDENCE

The Basic Hire Rate is the price/cost of hiring a like-for-like vehicle on the spot/upfront i.e. not on credit. It is usually calculated by:

Like-for-Like: Listing vehicles in the same range and category of the Damaged Vehicle. That;
Location: Were available to hire within ‘a reasonable distance’ from the Claimant. For;
Period: The same period as the hire went on i.e. if a hire company state they would only have allowed hire to last 1 month, but you needed 3, then that vehicle should be disregarded. Finally, the vehicle must have been available for the Claimant to hire at;
Time: The same time the Claimant commenced hire. As obvious as it may sound, if a hire company set up shop after the Claimant started hiring but before the trial, then it was not available option for the Claimant.

Should the court find that a Claimant DID NEED to hire a vehicle BUT you are NOT IMPECUNIOUS, then providing there is evidence of the applicable BHR, the court should allow you to recover some money for the Hire Vehicle. This regrettably for the Claimant, will be significantly less than claimed:

If you are not impecunious then you have no claim for credit hire.

Your obligation to disclose is always mandatory and non-negotiable.

IMPECUNIOSITY: For the solicitors:

Lagden -v- O’Connor [8] - It is the Claimant’s burden to prove that they were impecunious.
Bent -v- Highways & Utilities Construction and Allianz Insurance [9]: - Basic Hire Rate Evidence.

6. PERIOD:- DID YOU HAVE TO HIRE FOR SO LONG?

The following are e.g. questions that can be put to a Claimant in cross-examination:

Did you go on holiday and leave a credit hire vehicle in your driveway accruing £250 - £600 p/d when you were not using it? Who do you think should pay for the vehicle you hired but did not use? I get you needed to hire for work but why did you need a hire vehicle to leave on your driveway when you’re going back to the X Republic for 2 weeks?
When you received the money for your damaged vehicle, did you immediately return the hire vehicle, or did you just leave it in on your driveway allowing the credit hire charges to wrack-up so someone else could pay them?
When you put your damaged vehicle in for repair, did you chase the engineer for updates as to when it would be repaired, or did you just forget about it for 3 months, carelessly wrack up £500 p/d and then toddle up to court hoping someone would pay your debts?

The period of hire will have a substantial impact on the value of your claim. If credit hire charges are accruing at £250 - £600 p/d, each day of hire is an expense that someone will need to pay for. What you as the Claimant should explain/evidence in your witness statement (where applicable) is:

Was your Damaged Vehicle still roadworthy? Given the choice between driving a damaged car that is still roadworthy, or racking up charges one cannot afford to pay, the reasonable person would be expected to keep driving the car. If that has not happened in your case, then you need to explain/evidence it in your witness statement.
Holidays: The Reasonable Person would not hire a vehicle on credit and then leave it to rust in their driveway. If ever during the period of hire there was a time when you did not need the hire vehicle that should be explained/evidenced via your witness statement. Remember, ‘impecunious’ foreign owned insurance companies consistently meddling in UK elections; will instruct surveillance experts to check the hire car has not been left in the driveway. (Because that is fraud while consistently hoodwinking benighted elected officials with false promises to drop premiums, is not).
Delayed Repairs: The Reasonable Person would not just leave his Damaged Vehicle at a repair garage and then ‘forget about it’ especially if they were racking up hire charges they could not afford to pay. What the Reasonable Person would be expected to do and evidence/explain in their witness statement, are the dates that they:
1. Notified all relevant insurers promptly i.e. on the day of the RTA.
2. Allowed the Opposing Insurer to inspect the Damaged Vehicle promptly.
3. Enquired with the garage how long the repairs would take?
4. Put the Damaged Vehicle in for repairs promptly.
5. Chased the garage for updates.
6. Upon receiving the report from the repair engineer, provide promptly to the opposing insurer i.e. keep the insurer whom you allege should pay the costs updated so they can reserve accordingly.
7. Authorised the repairs to the Damaged Vehicle promptly.
8. Returned the Hire Vehicle immediately/promptly upon the repairs being completed or receipt for the cheque for damages.
Delayed Return: The Reasonable Person when receiving a cheque to get his vehicle repaired or alternatively, for the agreed value would be expected to use that lump sum of money to end hire promptly if not immediately. If in your case, you continued to hire after receiving your money then you should explain/evidence in your witness statement why hire lasted longer than either your repairs or when you had received your money?
Third Party Intervention: Solicitors and engineers are agents of the Claimant. That means if they have caused a delay the court will hold the Claimant responsible. It does the Claimant absolutely no good, to blame their solicitor. However, where the delay is caused by an entity not instructed by the Claimant e.g. the Opposing Insurer, or an entity abroad that is providing a spare part then this should be

Should the court find that your hire of the vehicle was justified but it went on for too long, then it will only allow you to recover some of the hire charges. That means you will have to pay the hire company the rest out of your own pocket!

PERIOD: For the solicitors:

Clark -v- Ardington Electrical Services[10]:- Delay attributable to third parties.

7. EXTRAS: ADDITIONAL CHARGES

EVIDENCE: Required to consider alleged extras/additional charges:

Credit Hire Agreement.
Witness Statement.
Invoices for hire and repair

The Reasonable Person is not mitigating should they take out with the Hire Vehicle additional extras they did not have prior benefit of. Equally, why should the Defendant be held liable for any additional charges that arise from the Claimant having a 2^nd accident with someone else?

In any case for credit hire, the parties would be well advised to review the invoices for:

Collision Damage Waiver.
Underbody Waiver.
Theft Excess Waiver
Young Driver Excess.
Additional Driver Surcharge.
High Mileage Charge.
Satellite Navigation Charge.
Automatic Vehicle Charge.
Road Tax
Additional Insurance
Dual Control Charge (driving Instructor)
The Engineer’s Fee.
Interest

Should any of these charges be included on an invoice then Claimant should put into evidence/explain via their witness statement why it would be just that the imposing insurer pay for them. Usually, the court will simply discount these charges from any sums owed.

THE ENGINEERS’S FEE

It is often incorrectly stated that an Engineer’s Fee is not recoverable pursuant to Clark v Adlington Electrical Services [2003]^[11]. This is not correct. The Engineer’s fee is recoverable UNLESS, it was arranged by the Credit Hire Company. In which case it is considered an additional benefit. Should the Claimant instruct an Engineer Directly/through solicitors then the fee is a disbursement that is recoverable in the usual way. i.e. agreement or by court order.

INTEREST

Interest on the credit hire charges is regularly claimed pursuant to the Supreme Court and County Court acts. This is not correct. When no money has changed hands and the claim is entirely on credit then no interest can accrue as per Pattni -V- First Leicest Buses Ltd [2011]^[12].

CONCLUSION

Gavin Renwick dealt with credit hire disputes at International Insurance firm Hill Dickinson in 2011 as part of the then market leading Insurance Fraud team. There he regularly and successfully defended against claims >£55'000. Since commencing his own practice in 2020 he received instructions from solicitors, credit hire companies and consumers directly acting for claimants and defendants respectively where he takes an unbiased, pragmatic commercial approach to realising his client's objectives.

Separately, should you be a car-thief; we intend to start offering Defendant criminal legal services in Q2 2026 but for now, please go away.