The defendant objected to paying the plaintiff the costs of a replacement hire car after the accident for which he was liable. He said that the plaintiff was in any event insured to recover that cost, and the insurance company were subrogated to the plaintiff’s claim. He also said that the insurer should give credit for any commission received by the insurer from the hire company.
Held: The defendant was liable. The arrangements between the claimant and his insurers were not the concern of the defendant. It was necessary to distinguish subrogation to remedy an unjust enrichment, and contractual subrogation which was concerned only with the mutual rights and obligations under the insurance contract and did not affect strangers to the contract. The insurance benefit is not the provision of a car but rather the payment of hire charges. The fact that Mr Bee was the Hirer under the agreement and that there was an express right of subrogation in order to recover Vehicle Hire Costs indicate that DAS were not the providers of the car; they merely reserved the right to nominate the hire company which would be unnecessary were DAS providing the car themselves. Even if it was contemplated that Mr Bee would never pay the hire charge himself, nonetheless he was in receipt of an insurance benefit, namely an indemnity against the cost of hire.
Judges:
Monson J
Citations:
Times 16-Jan-2007, [2006] EWHC 3359 (Comm), [2007] Lloyd’s Rep IR Plus 32
Links:
Jurisdiction:
England and Wales
Citing:
Cited – Castellain v Preston CA 12-Mar-1883
The court emphasised the amplitude of the insurer’s right of subrogation which gave him ‘the advantage of every right of the assured, whether such right consists in contract, fulfilled or unfulfilled, or in remedy for tort capable of being insisted . .
Cited – Adams v London Improved Motor Coach Builders Ltd CA 1921
The plaintiff successfully sued his employers for wrongful dismissal. The defendant argued it should not pay costs since it was the plaintiff’s union who had retained the solicitors in the case, and it was the union to which the solicitors looked . .
Cited – Yorkshire Insurance Co Ltd v Nisbet Shipping Co Ltd QBD 1961
The assured alone can give a valid receipt and discharge to a third party against whom a judgment has been given following a successful subrogated claim.
Diplock J said: ‘The expression ‘subrogation’ in relation to a contract of marine . .
Cited – Lagden v O’Connor HL 4-Dec-2003
The parties had been involved in a road traffic accident. The defendant drove into the claimant’s parked car. The claimant was unable to afford to hire a car pending repairs being completed, and arranged to hire a car on credit. He now sought . .
Cited – Burdis v Livsey QBD 2001
The several cases claimed the cost of provision by credit hire companies of car hire and repair services to the innocent victims of road accidents. The transactions were ‘res inter alios acta’ – collateral to the commission of the tort. . .
Cited – Dimond v Lovell HL 12-May-2000
A claimant sought as part of her damages for the cost of hiring a care whilst her own was off the road after an accident caused by the defendant. She agreed with a hire company to hire a car, but payment was delayed until the claim was settled.
Cited – Davies v Taylor (No 2) HL 2-Jan-1974
The plaintiff argued that no costs had been incurred by the successful defendant, as he was insured, and the insurance company was bound to pay his costs.
Held: ‘In this case the solicitors, no doubt first instructed by the insurance company, . .
Cited – Banque Financiere De La Cite v Parc (Battersea) Ltd and Others HL 16-Apr-1998
The making of an order for restitution after finding an unjust enrichment by subrogation, is not dependant upon having found any common or unilateral intention of the parties. The House distinguished between contractual subrogation of the kind most . .
Cited – Hobbs v Marlowe HL 1978
The doctrine of subrogation in contracts of insurance operated entirely by virtue of an implied term of the contract of insurance: ‘I take it to be clear beyond all argument that an assured under a policy insuring him against loss of or damage to a . .
Cited – Caledonian North Sea Ltd v London Bridge Engineering Ltd and Others IHCS 2000
Lord Rodger: ‘Subrogation works by giving the insurer who indemnifies the assured the right to raise proceedings in his name and, by the very nature of the circumstances in which it comes into play, the proceedings by the insurer must necessarily be . .
Lists of cited by and citing cases may be incomplete.
Insurance
Updated: 05 December 2022; Ref: scu.247978