Whilst it has long been a struggle for defendants to successfully argue that a credit hire agreement was unenforceable between the claimant and the hire company, since the decision of Mr Justice Turner in the case of Irving v Morgan Sindall PLC  it has become even more difficult for such arguments to be sustained, as agreements where there was only a contingent liability upon the claimant to pay the charges when they were recovered from a third party, were still likely to be considered enforceable.
However, notwithstanding the anticipated uphill struggle on this point, it is always important to test the nature of the agreement between claimant and hire company in any event, as evidenced by two recent cases where James Woodcock was instructed on behalf of the defendant and successfully argued that the hire agreement was unenforceable, thereby defeating the claims for hire charges in their entirety.
The first case, heard by a District Judge sitting at Kingston-upon-Hull County Court, related to a claim for hire charges totalling £3,290.18. Unusually, within the claimant’s witness statement, it was suggested that the hire charges were ‘covered and arranged under the terms of the claimant’s motor insurance policy,’ yet the claim presented to the Court included the aforementioned claim for credit hire charges. Under cross-examination, the claimant confirmed his understanding that his insurer was providing him with a replacement car, and that any costs related to this would be sought from the third party. However, when taken to the hire documents as submitted to the Court (and attached to his witness statement), the claimant suggested that he had never seen the hire agreement before, nor the terms and conditions, the mitigation questionnaire or the notice of right to cancel. Furthermore, when it was shown to the claimant that the agreement (which did not bear any signature, either handwritten or electronic) suggested he would be personally liable for the charges, the claimant confirmed that he would not have gone through with the hire had he known that this was the position. The Judge concluded that there was no evidence of any agreement between the claimant and the hire company, and therefore the claim for hire was dismissed.
The second case, heard by a Deputy District Judge sitting in Brighton County Court, concerned a claim for hire charges totalling £4,855.44. The claimant’s witness statement rehearsed the history of the signing of the agreement, suggesting that all documents had been seen and signed via the hire provider’s electronic online portal. However, under cross-examination, the claimant gave evidence that she had signed the agreement in writing, in-person, when the hire car had been delivered, and that she had not signed the agreement electronically via any online portal, nor had she seen or received any of the emails (attached to her witness statement) that purported to explain when the agreement had been sent and signed. As there was no hire agreement before the Court that had been signed by hand, the Judge was not satisfied that the claimant had proven on the balance of probabilities that a valid contract existed between the claimant and the hire company, and therefore the claim for credit hire was dismissed.
Whilst the success of the arguments as to enforceability in these cases relates to factual discrepancies between the claimant’s written/documentary evidence and their live evidence to the Court – rather than any alteration in the legal position as established by Irving and the cases that preceded it – these cases can give confidence to defendants in credit hire claims that the issue of the enforceability of the hire contract is not always a foregone conclusion, and that there are potentially significant gains to be made through properly testing the evidence at trial.