Diminished Value

[Lynx 36]

What is the name of your state? KY

Yes, I actually have a question. I've been seeing more and more postings about diminished value on a car. Now, I've always denied this when it is claimed.

My question is how does one go about getting this paid to them? Is it only in certain states? Are there any precedents set anywhere that require this to be paid by an insurance co.?

I called my old boss at the insurance co. I used to work for and they never pay it either but says it is a common request. Since I work f/ a company that has a fleet of vehicles I am curious as to what my legal position would be if someone were to pursue this (we are self-insured to a certain point). My guess is if the insurance co.'s in my state aren't paying this than I'm OK too. Any advice appreciated. Please post only if your familiar w/ this. I don't need guesses and possibly's. I'm capable of doing that.

Teflon, Senior Judge-I've seen you two mention a few times. Any advice or knowledge in this arena?

 

[You Are Guilty]

It depends - each state is different. For example, NY permits it.

Some more info which may help:

Some courts hold that the diminution in value is the basic measure of damages, but the cost of repair may be considered as a factor in assessing damages, or as "some evidence" of the vehicle's decreased value. [FN4] In several jurisdictions the plaintiff may elect to prove damages either by the cost of repair or by the diminution in value, [FN5] while in others the trier of fact is required to use the standard that will result in the lower damage award. [FN6]

FN4. See, for example, Winn-Dixie Montgomery, Inc. v Holt (1976) 57 Ala App 499, 329 So 2d 556.
Johnson v Summers (1980, Mo App) 608 SW2d 574.
Krueger v Steffen (1966) 30 Wis 2d 445, 141 NW2d 200.

FN5. See, for example, Tapes & Things, Inc. v Evans (1975) 133 Ga App 705, 212 SE2d 31
See also Restatement (Second) of Torts § 928 (1977)

FN6. Gamble v Smith (1978, Dist Col App) 386 A2d 692
Fanfarillo v East End Motor Co. (1980) 172 NJ Super 309, 411 A2d 1167

In states that permit either method, usually, using one precludes the introduction of evidence of the other, so you may still have an "out" on that basis

 

[JETX]

Yes, I actually have a question. I've been seeing more and more postings about diminished value on a car. Now, I've always denied this when it is claimed.

My question is how does one go about getting this paid to them? Is it only in certain states? Are there any precedents set anywhere that require this to be paid by an insurance co.?

As noted by SJ, the issue of 'diminished value' is determined by state law.

In your state (Kentucky):
In General Accident Fire & Life Assurance Corp. v. Judd, Ky., 400 S.W.2d 685 (1966) an insurer is required to restore the physical condition but not the value of the damaged automobile which was followed by the Court of Appeal in Tomes v. Nationwide Insurance Co., 825 S.W.2d 284 (Ky.App. 11/08/1991).

Some good sites on this issue are:
http://www.zalma.com/diminution.htm
http://www.aeiclaimslaw.com/spring01.htm
http://www.jurispro.com/uploadArticles/Zalma-Dimunition.PDF

 

[teflon_jones]

As the other two have already stated, it's a matter of state law. I'm in MA, and it's not allowed here. The DOI (Dep of Ins) has rejected allowing this, and so has the MA high court. Other states that are not diminished-value friendly: Texas, Maine, South Carolina, Delaware. All have had cases where they ruled against the concept. (I can find specifics if needed, but I'm trying to keep this general, plus I'm feeling lazy today.) In other states, it is allowed, and has been supported in the courts. Kansas and Georgia fall under this. In Louisiana, if the driver is deemed to be at fault, then they can't claim diminished value. If they weren't at fault, they may be able to get it. It also depends on the insurance company. State Farm has a policy of not allowing for it at all nationwide. How they deal with this in states where it has been allowed by judges, I have no idea.

The main problem is that there's no really accurate way to determine it, unlike the cost of repairs, which a bill is issued for. How do you calculate the loss of value? Do you base it on the current value of the car, and how much less it could be sold for tomorrow? Or do you calculate it based on the average length of time a person keeps a car? Or the term of the owner's loan? What if it's a leased vehicle? Most (if not all) insurance policies stipulate that repairs to a vehicle will return it to pre-accident condition. Given this statement in a policy, how can someone claim diminished value on a vehicle that's been returned to the same condition as before an accident? I don't know where there's a comprehensive list of states that do or don't explicitly allow it (or if there even is one). Some states really have no guidelines on it at all since it's a concept that hasn't really been a big enough factor to warrant a lot of attention until probably the last 5 years or so. I always advise people to request it. The worst that can happen is that the insurance company will say no!

EDIT: JETX, I checked out the page on zalma.com you posted and that's the best listing I've seen for cases related to this. I hadn't seen that page before!

 

[You Are Guilty]

As noted by SJ, the issue of 'diminished value' is determined by state law.

As noted by who?

 

[Lynx 36]

Thanks f/ the replies everyone. Since I don't work directly f/ an insurance co. any more I'm out of the loop so to speak if there are late trends or precidents.

I will check out the websites JETX and You Are Gulity posted so I can stay in tune w/ this issue. Especially the case here in my state.
I agree w/ Teflon, it seems difficult to come up w/ some sort of exact science f/ figuring it out. I tend to agree that it can decrease the overall value of the car in certain situations though. Especially new vehicles.

Again, I appreciate the advise and will continue to monitor this trend. Have a good weekend everyone.

 

[JETX]

As noted by who?

SJ = SeniorJudge
YAG = You Are Guilty

 

[Phredd]

... I'm in MA, and it's not allowed here. ... In other states, it is allowed, and has been supported in the courts. ...

Do you know whether or not New Hampshire allows diminished value? I've searched and searched and haven't found anything either for or against. In the absence of a law or precedent against allowing diminished value, would the judge have complete discretition to rule either way?

As for estimating value, I presented a Kelly Blue Book report for both "Excellent" and "Good" value, the difference being $480. I thought this might be sufficient for small claims.

Thanks for your comments,
Fred

 

[Lynx 36]

Do you know whether or not New Hampshire allows diminished value? I've searched and searched and haven't found anything either for or against. In the absence of a law or precedent against allowing diminished value, would the judge have complete discretition to rule either way?

As for estimating value, I presented a Kelly Blue Book report for both "Excellent" and "Good" value, the difference being $480. I thought this might be sufficient for small claims.

Thanks for your comments,
Fred

There have been no cases in your state to set a precedent. I haven't read where a state has allowed it yet. Let me ask you this. How do you prove diminished value? That would require you to hire an appraiser f/ starters. Then you would have to prove in court which would be hard to do since there is no formula f/ figuring it out. The appraiser and court fees alone would cost $500 and the odds of winning are slim to none. You make the call.

 

[JETX]

Do you know whether or not New Hampshire allows diminished value?

Yes, I know. However, I don't provide answers to people who hijack other persons threads. Doing so is both rude (by diverting attention from the original poster to you) and confusing (when you think a reply is to you... when it is to the original poster).
Delete your post here and start your own thread.... and I will be glad to try to help.

 

[BelizeBreeze]

As noted by who?

As noted by "WHOM"

 

[Phredd]

Sorry, didn't mean to hijack.

Yes, I know. However, I don't provide answers to people who hijack other persons threads. Doing so is both rude (by diverting attention from the original poster to you) and confusing (when you think a reply is to you... when it is to the original poster).

I am truly sorry. I didn't realize this was hijacking since it was so related to the original post. I'll start a new thread and I'll be more careful next time.

Fred

 

[You Are Guilty]

As noted by "WHOM"

I'm sorry to have to inform you of this, but the statute of limitations for grammar corrections is only 30 days, so your post is barred.