Impecuniosity is the financial inability of a claimant to pay for a hire vehicle on the open market. Where impecuniosity is established, the claimant may recover the full credit hire rate rather than being limited to the BHR. The test asks whether the claimant could have paid hire charges without making unreasonable sacrifices.
How do you prove impecuniosity in a credit hire case?
Provide three months of bank statements, credit card statements, and savings account statements covering the period before and after the hire. Show that the claimant's income, savings, and available credit would not have allowed them to pay hire charges upfront without unreasonable sacrifice. Explain any earmarked savings or financial commitments.
What evidence of impecuniosity is needed in a witness statement?
The claimant should disclose bank statements, credit card statements, savings accounts, and any loans or overdraft facilities for three months before and after the hire period. The statement should explain why the claimant could not have afforded to pay for hire upfront, including whether any savings were earmarked for specific purposes.
What is the difference between a credit hire rate and a Basic Hire Rate?
A credit hire rate (CHR) includes the cost of providing the vehicle on credit, plus additional services like delivery, collection, and insurance. The Basic Hire Rate (BHR) is the underlying rate stripped of credit and additional services. If the defendant argues the CHR is too high, they must prove the BHR with direct evidence.
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