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Torts – damages

Arsalan v Rixon; Nguyen v Cassim [2021] HCA 40 (8 December 2021) concerned two separate appeals in which the High Court was required to determine whether the appellants, who had admitted liability for the cost of repair to cars damaged in traffic accidents, were also liable for the costs of hiring equivalent substitute cars until the completion of repairs.

In both appeals the respondents owned prestige vehicles and hired equivalent cars during the period of repair.

The Court of Appeal of the Supreme Court of NSW allowed the respondents to recover their hire costs from the appellants. The appellants sought special leave and appealed to the High Court.

The High Court (Keifel CJ, Gageler, Keane, Edelman and Steward JJ) unanimously dismissed the appeals.

The High Court, observing the divergence of views in the courts below, considered (at [17]) that “this division of opinion reflects the lack of any clear recognition in Australian law of loss of amenity, in the sense of loss of pleasure or enjoyment, in the use of a chattel, as a recoverable head of damage”.

The High Court (at [25]) rejected the appellants’ argument that compensation for negligent damage to a chattel should be assessed any differently from negligent damage to real property to exclude loss of amenity.

In particular, the High Court (at [28]-[32]) rejected the concept of “need” for an equivalent hire car in assessing damages.

The High Court (at [40]) recognised that the respondents’ consequential loss was not limited to the purposes or uses for which the (now damaged and unavailable) car was likely to have been put to during the repair period, but included loss of amenity of the car, “…including their enjoyment of the safety features, pleasurable functions, and other specifications of those cars”.

Dr Michelle Sharpe is a Victorian barrister practicing in general commercial, real property, disciplinary and regulatory law, 03 9225 8722, email msharpe@vicbar.com.au. The full version of these judgments can be found at austlii.edu.au.

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