Should the person who caused the crash be made to pay off the outstanding loan for the car?
By KC Vijayan, The Straits Times 8 February 2009
When a car involved in an accident has to be scrapped because it is too badly damaged to be repaired, should the person who caused the crash be made to pay the outstanding hire-purchase sum owed on the car?
A district judge’s answer to this is yes, in a case where the victim has claimed the expense as part of the damages the defendant has to pay.
District Judge Leslie Chew is, however, allowing the case to go to a higher court on appeal, because its ruling on this “would be to the public’s advantage”.
The issue is said to have vexed the industry - not only in cases where cars beyond repair are scrapped, but also in those in which the car owner chooses to have the car repaired, if only to avoid having to redeem the outstanding loan on the car.
Judge Chew said, in the grounds for his decision published yesterday, that although the sum involved in the dispute heard in his court was relatively low, a High Court ruling would still be of importance to motor insurers and car owners, given that almost all actions arising from vehicle collisions are dealt with in the lower courts.
Details of the crash which led to the case over which he presided - the facts of which were not in dispute - were not in the written judgment.
It is known, however, that insurers pegged the market value of $58,000 on motorist Mr. Ang Teck Beng’s car. The outstanding loan on it, however, was about $72,000. Scrapping the car - and paying off the loan - meant Mr. Ang had to make good a difference of $11,682, so he went to court to make this claim last November against defendant Jason Tan. Mr. Ang was awarded the $11,682, but Mr. Tan appealed.
In the appeal, Judge Chew brought down the sum to $10,282 - the actual sum Mr. Ang lost after taking into account the $1,400 difference between the market value of the car and the amounts he got from the scrap value and the insurers.
Judge Chew ruled that the guiding principle is whether the claim sought is a direct consequence of the defendant’s negligence - in other words, whether the loss was legally caused by the defendant.
Mr. Tan’s lawyer Roger Yek had argued that while his client had caused damage to Mr. Ang’s car in the crash, he did not cause the loss Mr. Ang suffered from having to pay off the car loan.
But the judge countered that the loss was “reasonably forsee- able”, in that Mr. Ang’s expense in redeeming the car loan “flowed from the damage caused by the defendant”.
He explained that the expense did not arise because Mr. Ang had decided to scrap his car, but “rather he came into that state of affairs by reason of the damage caused by the defendant”.
The High Court appeal is expected to be heard later this month.
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Paying for a wrecked car
Should the person who caused the crash be made to pay off the outstanding loan for the car?
By KC Vijayan, The Straits Times
8 February 2009
When a car involved in an accident has to be scrapped because it is too badly damaged to be repaired, should the person who caused the crash be made to pay the outstanding hire-purchase sum owed on the car?
A district judge’s answer to this is yes, in a case where the victim has claimed the expense as part of the damages the defendant has to pay.
District Judge Leslie Chew is, however, allowing the case to go to a higher court on appeal, because its ruling on this “would be to the public’s advantage”.
The issue is said to have vexed the industry - not only in cases where cars beyond repair are scrapped, but also in those in which the car owner chooses to have the car repaired, if only to avoid having to redeem the outstanding loan on the car.
Judge Chew said, in the grounds for his decision published yesterday, that although the sum involved in the dispute heard in his court was relatively low, a High Court ruling would still be of importance to motor insurers and car owners, given that almost all actions arising from vehicle collisions are dealt with in the lower courts.
Details of the crash which led to the case over which he presided - the facts of which were not in dispute - were not in the written judgment.
It is known, however, that insurers pegged the market value of $58,000 on motorist Mr. Ang Teck Beng’s car. The outstanding loan on it, however, was about $72,000. Scrapping the car - and paying off the loan - meant Mr. Ang had to make good a difference of $11,682, so he went to court to make this claim last November against defendant Jason Tan. Mr. Ang was awarded the $11,682, but Mr. Tan appealed.
In the appeal, Judge Chew brought down the sum to $10,282 - the actual sum Mr. Ang lost after taking into account the $1,400 difference between the market value of the car and the amounts he got from the scrap value and the insurers.
Judge Chew ruled that the guiding principle is whether the claim sought is a direct consequence of the defendant’s negligence - in other words, whether the loss was legally caused by the defendant.
Mr. Tan’s lawyer Roger Yek had argued that while his client had caused damage to Mr. Ang’s car in the crash, he did not cause the loss Mr. Ang suffered from having to pay off the car loan.
But the judge countered that the loss was “reasonably forsee- able”, in that Mr. Ang’s expense in redeeming the car loan “flowed from the damage caused by the defendant”.
He explained that the expense did not arise because Mr. Ang had decided to scrap his car, but “rather he came into that state of affairs by reason of the damage caused by the defendant”.
The High Court appeal is expected to be heard later this month.
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