Legal Showdown Over Costly Credit Hire Charges

8

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

This legal clash originated from a vehicular accident in Wollongong, December 2021, where Cameron Lazicic’s car collided with and irreparably damaged Thomas Rossi’s Honda Civic.

While Mr. Lazicic’s insurer, NRMA Insurance, admitted liability for the damages, they refuted the $29,684 bill from credit hire company Right2Drive. This charge was for a Hyundai i30 rented at $343 per day for 86 days, until Mr. Rossi’s car was replaced.

The total bill for the car hire exceeded the cost of purchasing some models of the Hyundai i30 outright. This discrepancy has sparked significant legal debate.

Given NRMA Insurance’s rejection of the credit hire claims, Mr. Rossi proceeded to sue Mr. Lazicic. However, in an interesting turn during the Local Court proceedings, the magistrate observed Mr. Rossi’s apparent confusion and reluctance, noting that credit hire company Right2Drive had likely initiated the lawsuit by exercising a right of subrogation.

Known for offering replacement vehicles to car crash victims with the assurance of reclaiming the expenses from the at-fault party’s insurer, credit hire companies have drawn the ire of motor insurers. The main concerns stem from their substantial fees, which insurers argue inflate claims and, consequently, hike insurance premiums.

NRMA Insurance provided evidence illustrating that alternative hire car services in Wollongong offered rates as low as $90 per day at the time of the accident. Mr. Lazicic maintained that a rental fee of $7380, equivalent to $85.52 per day, was more reasonable. However, the Local Court ruled against him, holding him liable for the full credit hire bill.

In his appeal last month, the NSW Supreme Court’s Justice Jeremy Kirk highlighted a critical lack of communication between Right2Drive and Mr. Rossi about the financial implications of the hire.

Justice Kirk remarked that Mr. Rossi received a call from Right2Drive shortly after the accident. According to the Local Court magistrate, during this call, there was no discussion regarding payment, rates, or potential discounts. Justice Kirk noted, "When asked about agreeing to pay roughly $345 for a fairly ordinary $22,000 car, Mr. Rossi implied he was unaware of the rate being charged." Further, Mr. Rossi did not inquire about the costs involved.

Ultimately, Justice Kirk overturned the Local Court’s initial decision, citing the magistrate’s failure to provide detailed reasoning or critically assess whether Mr. Rossi's actions in incurring the rental expenses were justified.

This matter has been sent back to the Local Court for a new hearing, promising further developments in the ongoing legal battle.

The original source of this story can be found on [Insurance News](https://www.insurancenews.com.au).

Published:Friday, 9th Aug 2024
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Clear

ACCC Halts IAG's Acquisition of RAC Insurance Over Competition Concerns

11 Dec 2025: Paige Estritori

The Australian Competition and Consumer Commission (ACCC) has recently blocked Insurance Australia Group's (IAG) proposed acquisition of RAC Insurance Pty Limited. This decision underscores the regulator's commitment to maintaining competitive dynamics within Western Australia's insurance market. - read more

Suncorp Reaches Maximum Reinsurance Retention Following Severe Storms in Queensland and NSW

11 Dec 2025: Paige Estritori

Recent supercell thunderstorms in South East Queensland and northern New South Wales have led to a surge in insurance claims, prompting Suncorp to reach its maximum reinsurance retention of $350 million. The insurer has reported over 10,000 claims related to these events, with approximately half pertaining to home damages and the other half to motor vehicles. - read more

NTARC Report Identifies Inattention and Speed as Primary Factors in Major Truck Crashes

11 Dec 2025: Paige Estritori

The National Truck Accident Research Centre (NTARC) has released its latest Major Incident Investigation Report, highlighting inattention, distraction, and inappropriate speed as the most frequent human factors behind major truck crashes in Australia. While there has been a modest reduction in these incidents compared to previous years, they continue to pose significant risks to road safety. - read more

Rising Mental Health Claims Reshape Australia's Insurance Landscape

10 Dec 2025: Paige Estritori

The Australian insurance industry is witnessing a significant shift as mental health conditions have become the leading cause of total and permanent disability (TPD) claims. Recent data from the Council of Australian Life Insurers (CALI) indicates that mental health issues now account for nearly one-third of all TPD claims, marking a substantial change in the industry's claim patterns. - read more

Australian General Insurers Achieve $6 Billion Profit Amid Fewer Natural Disasters

10 Dec 2025: Paige Estritori

In a remarkable turnaround, Australian general insurers have reported a combined profit of $6.1 billion over the past year. This substantial increase is attributed to a period of relative calm in natural catastrophes and robust investment returns. - read more

Click for more Insurance News