Are Write-Offs (Total Loss Vehicles) Appropriated Lawfully

paddyjoe26

So I walked away from an accident. No Scratch. My car was written-off (total loss). Only found out later. Car came off slightly worse with a dent spanning both doors. Drove the car for weeks. Both doors closing perfectly. Went confidently to meet the engineer. The engineer scribbled away on his clipboard. Cheerfully announced that it fell into category C total loss. Confused I asked him to explain.

It’s repairable but uneconomical to repair, therefore is a total loss.
What does that mean?
We will pay you the market value and we will collect the car tomorrow.
No you won’t, if it is repairable why can’t I repair it?
Because it is now ours.
So you can sell my car to someone else to repair, but you won’t let me?
Right.
With that he turned and walked away.

In a state of disbelief and near panic I phoned the claims department. Refused to give up my car. Argued for longer than it took to make it. Eventually a breakthrough.

You can buy the car back.
How much?
5% of Market Value.
My gut says you’re mugging me, but ok.
I collapsed. Exhausted. Relieved. Determined to find the truth.
Found the contract. Confused. Went to the library. The first of many visits. Wrote to the broker and underwriter. Evasion and lies. Obfuscation. Wrote to the ombudsman. Regurgitated same insurance jargon. Wrote to the regulator. Fished, prodded and probed for answers. Took four years. Evasion, avoidance, obfuscation.

So here I am still a total loss victim. Many say I’m stupid to waste my time. That time is not yet. 500 000 victims this year. 500 000 victims last year. 500 000 victims next year. Tackling unfairness can’t be a waste of time.

So how is it possible for the cash settlement to buy the ‘total loss’ when?:

The claim is for the damage which creates a debt. The cash settlement is paying that debt. So how does paying off a debt, simultaneously buy a ‘total loss’?

You might say, because the insurer paid the market value for the vehicle. This is not true. I have not seen a single contract that directly states: “we will pay you the market value FOR your vehicle.” It is only implied by a contract lying in front of me; it states: “We will either pay for the car to be repaired by a repairer of our choice or pay you the market value OF the car.” It would be fraudulent to directly state that market value is paid FOR the car, therefore it is implied and left to us to think it; and we oblige. Other contracts will only state that the maximum amount to be paid (against the claim for damage) is the market value. here is it used only as a cap on the payment, and not as a payment per se. once again, we give it a totally different meaning; falling for the ruse hook, line and sinker.
So how does the debt buy the vehicle lawfully?
It doesn’t.

I quote from a standard contract: “Once we settle your claim the vehicle belongs to us.”
Interpreted in the context of the contract this means: Once we pay the debt created by the claim for damage, we will unlawfully appropriate the vehicle, because you will believe that we paid you the market value for your vehicle.

Gotcha.

nidO

As you predicted, i'm baffled as to how/why you've wasted 4 years on this.

paddyjoe26 wrote: »

So how is it possible for the cash settlement to buy the ‘total loss’ when?:

The claim is for the damage which creates a debt. The cash settlement is paying that debt. So how does paying off a debt, simultaneously buy a ‘total loss’?

They are offering to pay you the market value of the car, in return for the car.

As you discovered, your alternative to that is for them to pay you the market value of the car less its scrap value, and for you to keep the car.

I'm unsure why on earth you would expect them to pay you the full market value of the car and let you keep it, because they are insuring your loss and if you still have the car you haven't lost the car's full market value, you've lost its market value minus its scrap value, because you still have the car to scrap (or repair if you prefer to go that route).

Given that this is an arrangement most people are usually very happy with (your insurer has given you almost the market value of your car and you still have a fully functional car with minor damage you can choose to repair on the cheap or not bother, leaving you quids in either way) i'm baffled as to what your issue is, barring one engineer who didn't know how total loss claims work.

Nearlyold

The answer to the OP's title question is Yes


I guess by extrapolating the OP's logic if the insurance company paid out on a theft claim and the car was eventually found the OP would expect to get the car back and still keep the insurance pay out.

Daniel54

paddyjoe26 wrote: »

The claim is for the damage which creates a debt. The cash settlement is paying that debt. So how does paying off a debt, simultaneously buy a ‘total loss’?
..............
I quote from a standard contract: “Once we settle your claim the vehicle belongs to us.”
Interpreted in the context of the contract this means: Once we pay the debt created by the claim for damage, we will unlawfully appropriate the vehicle, because you will believe that we paid you the market value for your vehicle.

In your 4 years of research a few key issues seem to have eluded you

In this country the principles and practices of insurance contracts are underpinned by centuries of case law dating back to the time when marine insurance was first given by Lloyds of London.As the actions of your insurer are fully supported by case law ,they cannot be deemed to have acted unlawfully,and this is why your complaints have all been easily rejected

A few words on indemnity and salvage

The settlement of an insurance claim does not create a debt.It creates an obligation on the insurer to put you back in the financial position you would have been in had the loss not occurred.This is an indemnity,not a debt .The insurer is perfectly within their rights if they hold that the most cost effective way to fully indemnify the policyholder is by way of cash settlement and deem the insured property to be a total loss ( although there can often be some haggling over the appropriate amount).

I sincerely hope you took an agreed cash settlement from the insurer and then paid to buy back your car and fix it at your own expense

A policyholder cannot profit from from an insurance claim so in settlement of a total loss must abandon title to the item insured in favour of the insurer,who can use any proceeds to mitigate the cost of the claim.This dates back to the principles of salvage and applies for instance also in the case of recovered stolen goods or discovery of an item of jewellery thought lost and claimed for

So I will correctly parse your closing paragraph as follows: "Once we have fully indemnified the policyholder under the terms of the contract we will in accordance with insurance law and practice take possession of the vehicle as salvage and use any proceeds to offset the cost of the claim to us"

paddyjoe26

Daniel54
Yes. Case law underpins our judicial system, but in relatively recent times our laws are predominantly statutory instruments, no doubt grounded sometimes in historical case law, and occasionally tweaked by new case laws.
“As the actions of your insurer are fully supported by case law, they cannot be deemed to have acted unlawfully, and this is why you complaints have all been easily rejected.”
I’m not so sure about rejected. Evaded? Yes. Avoided? Yes.
The best way to discover the truth is for us to critically examine a current contract in light of the realm of law and logic. I believe the contract I selected is representative of the majority, but if you prefer to debate another contract I have no problem with that.
From Privilege:
1) “If your car is damaged we will decide to:
2) Pay to repair the damage.
3) Replace what is lost or damaged.
4) Settle your claim by sending you a cheque, or by bank transfer.
5) We will not pay more than the market value of the car at the time of the loss.
6) Once we settle your claim your car will become our property…”
The first three terms are self-explanatory.
4) What is meant by “settle your claim”?
Clearly the claim is for damage. This triggers a debt or a liability, or an indemnity. Whichever way you look at it the process creates a debtor, the insurer, and a creditor, the claimant. This still sounds like a debt to me. ‘Settle’, in this context means to pay the debt. So the promise or contractual liability is to pay the claim (invoice) for the damage, by sending a cheque or by bank transfer. This transaction cancels the debt, neutralizing the creditor/debtor relationship.
5) How much is due to the claimant? Not more than the market value of the car pre-accident. If the damage is repaired this insurer will pay he actual costs claimed by the repair shop. If the damage is not repaired the insurer caps the amount to be paid, in lieu of repairing the damage, at the market value of the vehicle. This seems to be a very fair method for establishing the actual amount of the debt which the insurer has to pay to settle the claim. At no time is there any suggestion that the market value is being paid for the vehicle. This is in your mind; not in the contract. As Shakespeare’s Hamlet put it: “There’s neither good nor bad, but thinking makes it so.”
6) “Once we settle your claim your car will become our property…” Having dealt with the first part of this term, we need to examine “…your car will become our property.”
What exactly initiates a lawful transfer of property? The Sale of Goods Act 1979 requires a payment of a consideration; usually money, for the property in question. It cannot be argued with any credibility that the settlement payment is for the vehicle. Insurers together with the vacuous, attempt to introduce the concept of a ‘damaged vehicle’, thereby transposing the payment for damage to the vehicle. This is a fraudulent misrepresentation as ‘damage’ and ‘vehicle’ are two separate entities. There is ‘damage’ and there is the bearer of the damage: the vehicle. Each is treated separately in terms of the law, unlike the vehicle per se. Practically, this means that the insurer has lawful contractual authority to repair damage, but the contractual claim purporting to obtain the vehicle for the insurer is not legitimated. It is void in terms of contractual law. Therefore, the moment the insurer as the non-owner of the vehicle takes control of it, the Theft Act 1978 is transgressed.

In the light of two decision of the House of Lords in Morris and Gomez, it has been considered that 5.3(1) of the Act should now read as follows: “Anyone doing anything whatever to the property belonging to another with or without the authority or consent of the owner, appropriates it; and if he does so dishonestly and with intent, by that act or any subsequent act, permanently to deprive, he commits a theft.” (Criminal Law: C Elliot and Francis Quinn.)

Clearly, an appropriation as the non-owner is unlawful. Therefore the question “Are write-offs (Total Loss Vehicles) Appropriated Lawfully? The answer is NO.

You miss the point by attempting to compare the laws germane to individual property rights in the context of a specific contract, and an amorphous soup of principles of salvage and old case law. Can any of this trump the general laws and those pertaining to contracts? Perhaps you should also consider the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR’s). Regulations 5(1) and 6(1) are pivotal. Which case law trumps the Human Rights Act 1998, Article 1 of the First Protocol? “Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided by the law and by the general principles of international law.”

paddyjoe26

Nido

As you predicted I’m baffled as to how/why you’ve wasted 4 years on this’.
Fair question. I mentioned having fished, prodded and probed for answers. Example: asked a pivotal question, (to be posted later), on 29th May 2012; eventually after, many reminders, received an answer on 23rd March 2015 from a senior executive of the FCA (regulator). It took virtually 3 years of badgering, amongst all the other pivotal questions still unanswered, from 2011.
With respect, I don’t think that you and most readers understand what role ‘market value’, as such, serves in the context of the contract. “They are offering to pay you the market value of the car, in return for the car.” Not so. Please read an insurance contract with a clear head, uncluttered by insurance jargon and spin. You will find that the role of the ‘market value’ is no more than to put a cap on the amount of the cash settlement to be paid against the claim; and the claim is for damage not repaired in this case. The contractual liability is to pay for the damage, whether repaired or not. Can you find a single term in any of the contracts which openly states: We are paying you the market value for your car? It is only implied, and our minds do the rest.

InsideInsurance

Lets see....

Direct_Line wrote:

5. Uneconomical repairs
If your car is uneconomical to repair (written off) and we agree to settle your claim on that basis, you still owe the full yearly premium as we will have met all our responsibilities to you under the policy. Once we settle your claim, your car will become our property and you must send us the registration document. All cover will then end unless we agree differently. We will not refund any of your premium

Admiral wrote:

10. Total loss of your car
If your car is a total loss, all cover including the driving of other cars extension, if applicable, is cancelled for you and any other drivers on the policy. Once we make a payment to you, your car will become our property. We will deduct any outstanding premium and charges owed from any claim settlement we make to you.

Tesco wrote:

If the car is a total loss
When you accept our offer for total loss, the car will belong to us

eSure wrote:

If we settle a claim under this section as a total loss, the lost or damaged car becomes our property

How many more do you want checked?

Nearlyold

I can't see how any amount of convoluted pseudo legal gymnastics aka claptrap (remarkably similar to Freeman on the Land woo) will change things, the definitive answer is ITS LAWFUL.

dacouch

InsideInsurance wrote: »

Lets see....








How many more do you want checked?

Could you confirm or deny that your post took four years of research?

InsideInsurance

dacouch wrote: »

Could you confirm or deny that your post took four years of research?

might have been slightly closer to 4 minutes but I did cheat and use some PDFs I had previously downloaded. If I'd had to google for each one well.... who knows how long it could have taken

Astronaughtwannabe

Gomez isn't the leading case on theft, Gosh is, and it requires the subjective/objective test of dishonesty to be proven for the offence to be complete.

You'd have about the same odds in getting a conviction against an insurer for theft as you would for putting a case before a jury for picking up a free newspaper.