UKSC/2025/0116
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COURT PROCEDURE
Tescher (Respondent) v Direct Accident Management Limited (Appellant)
Case summary
Case ID
UKSC/2025/0116
Parties
Appellant(s)
Direct Accident Management Limited
Respondent(s)
Yehuda Tescher
Issue
If a claimant brings a road traffic accident claim in which they seek damages for (at least) personal injury and credit hire costs, having hired a replacement vehicle from a credit hire company on deferred payment terms, and the claim fails, in what circumstances can the non-party credit hire company be made liable for the defendant’s costs?
Facts
The two County Court cases had no pre-existing links until their appeals were listed together in the Court of Appeal. The Appellants are both credit hire companies which hire replacement vehicles on deferred payment terms to motorists who have been in road traffic accidents and are pursuing compensation claims against another motorist. In the first case, a motorcyclist named Mr Quesada collided with Mr Tescher. Mr Quesada, who needed a vehicle for his job as a courier, hired a replacement motorcycle from Direct Accident Management Limited (“DAML”), with the hire charges deferred until the conclusion of his compensation claim against Mr Tescher. Mr Quesada’s compensation claim, which sought damages for personal injury and special damages (including the hire charges), was pursued by solicitors referred to him by DAML. The County Court held that Mr Tescher was not responsible for the accident and ordered Mr Quesada to pay Mr Tescher’s costs, although not without the permission of the court pursuant to the Qualified One-Way Costs Shifting (“QOCS”) rules. On Mr Tescher’s application, DAML was joined as a second defendant to the proceedings for costs purposes. Mr Tescher applied for a Non-Party Costs Order (“NPCO”). The County Court judge dismissed the NPCO application on the basis that he was not satisfied that DAML was the “real party” to the proceedings and Mr Tescher had not established causation. Mr Tescher appealed to the Court of Appeal. In the second case, a driver named Ms Smith was “t-boned” by another driver insured by AXA Insurance UK PLC (“AXA”). Ms Smith, who needed a car for her job as a district nurse, hired a replacement car from Spectra Drive Limited (“Spectra”), again with the hire charges deferred until the conclusion of her claim against the AXA-insured driver. Ms Smith’s compensation claim was pursued by solicitors referred to her by the claims management company which had also referred her to Spectra. Although the AXA-insured driver admitted liability five days after the accident, Ms Smith’s solicitors advised her to discontinue her claim after AXA alleged that she had been dishonest about her need for a replacement car. As a result of her discontinuance, the County Court ordered costs against her, not to be enforced without the permission of the court under the QOCS rules. AXA applied to enforce the costs and for a NPCO against Spectra. The County Court (Wakefield) refused the enforcement of costs on the basis that Ms Smith had not been dishonest and would have won her claim but for her solicitors’ advice, but granted the NPCO against Spectra. On appeal, the County Court (Leeds) set aside the NPCO. AXA appealed to the Court of Appeal. The Court of Appeal allowed both Respondents’ appeals and made NPCOs against both Appellants. The Appellants now appeal to the Supreme Court.
Date of issue
16 July 2025
Case origin
PTA