Motor Vehicle Accident Claims

A motor vehicle accident can create immediate problems. A car may be damaged or written off. Towing and storage costs may be incurred. A driver may be left without transport. Insurance companies may become involved quickly. In some cases, no insurer is available at all.

Many car accident claims are handled between insurers. Each driver gives details to their own insurer, and the insurers then deal with liability and recovery between themselves. That process is usually simpler where both drivers are insured.

Difficulties often arise when one party is uninsured. If an uninsured driver causes damage, the other driver or vehicle owner may need to recover repair costs directly. If an uninsured driver is blamed for an accident, they may receive a letter of demand from the other driver or from an insurance company. Either situation can become stressful very quickly.

We act for both plaintiffs and defendants in motor vehicle property damage claims. That includes people seeking to recover repair costs. It also includes people defending a claim made by another driver, insurer or debt recovery agency.

This page concerns property damage claims. It does not deal in detail with personal injury claims arising from transport accidents. In Victoria, injury claims are usually dealt with through the Transport Accident Commission scheme. Property damage claims are different. They are often dealt with by insurers, negotiation or court proceedings. A claim for the cost of repairs to a damaged car can be made through an insurance company or through the courts if necessary.

What can be claimed after a car accident?

The most common claim is for the reasonable cost of repairing the damaged vehicle. If the car is written off, the claim may be for market value rather than repairs. Other losses may also arise. These can include towing, storage, hire car costs and assessment fees.

The amount claimed should be supported by evidence. A repair invoice is usually stronger than an estimate. A written quote may still be useful if repairs have not yet been completed. Photos of the damage can help. So can dashcam footage, witness details and accident diagrams.

The person making the claim must usually prove two things. First, they must prove that the other driver was at fault. Second, they must prove the amount of loss claimed. Fault and amount are separate issues. A person may be responsible for an accident but still dispute the repair bill.

A defendant may argue that they were not at fault. They may argue that both drivers were partly at fault. They may also argue that the amount claimed is excessive. For example, they may say the repairs were unreasonable, unrelated to the accident or more expensive than necessary.

Letters of demand

A letter of demand is usually the first formal step. It asks the other party to pay a stated amount within a set time. It should explain what happened, why payment is claimed and what evidence supports the amount sought.

A letter of demand as a notice that asks a person to pay a debt and warns that court proceedings may follow if payment is not made. In a car damage claim, the letter will usually identify the accident date, vehicles involved, amount claimed and payment deadline.

A good letter of demand should be clear. It should not exaggerate. It should attach or refer to key documents. These may include repair invoices, quotes, photographs and any insurance correspondence.

A person receiving a letter of demand should not ignore it. Ignoring the letter may lead to court proceedings. It may also increase costs. If the claim is disputed, a written response should usually be sent. That response may deny liability, dispute the amount claimed or propose settlement.

In some cases, a payment plan may be appropriate. In other cases, the claim should be defended. The right response depends on fault, evidence, insurance position and capacity to pay.

If the other party does not pay

If a letter of demand does not resolve the dispute, court proceedings may be considered. The correct court will depend on the value of the claim and the type of dispute.

In Victoria, the Magistrates’ Court can hear civil disputes up to $100,000. These disputes include debts, claims for damages and other monetary disputes. Many motor vehicle property damage claims fall within that limit.

A proceeding in the Magistrates’ Court is commonly commenced by filing a Complaint. The Magistrates’ Court identifies Form 5A as the Complaint form used to initiate legal action in its civil jurisdiction. The Complaint should be supported by a Statement of Claim that sets out the facts and the amount sought.

The documents must then be served on the defendant. Service is important. A court will not usually proceed against a defendant unless proper service has occurred.

Once served, the defendant has a limited time to respond. A defence must be lodged within 21 days after receiving a Complaint Form 5A. If no defence is filed within time, the plaintiff may apply for default judgment. The Magistrates’ Court also states that if no defence is filed within 21 days, the plaintiff may apply for default judgment.

Default judgment can have serious consequences. It may allow the plaintiff to enforce the debt without a contested hearing. A defendant who receives court documents should get advice quickly.

Defending a motor vehicle damage claim

A person sued after a motor vehicle accident may have several possible responses. They may accept the claim. They may dispute fault. They may dispute the amount claimed. They may also argue that the plaintiff has sued the wrong person.

Fault is often the main issue. The court may consider road rules, witness evidence, photographs, dashcam footage and the location of vehicle damage. Admissions made after the accident may also be relevant, although people often disagree about what was said.

Quantum means the amount of the claim. A defendant may accept that some damage was caused but dispute the total amount sought. This can arise where the repair bill appears too high. It can also arise where the plaintiff claims for pre-existing damage.

A defendant may need their own evidence. This may include photographs, their version of the collision, witness statements or an alternative repair assessment. If an insurer is involved, insurance correspondence should also be reviewed carefully.

Defending a claim does not always mean going to a final hearing. Many matters settle. Settlement can avoid cost, delay and risk. It may involve a reduced lump sum, instalments or agreement that each party bears their own costs.

What happens after a defence is filed?

Once a defence is filed, the case becomes contested. The court may list the matter for directions, conference, arbitration or hearing. The precise pathway depends on the amount claimed and the nature of the dispute.

The Magistrates’ Court states that defended civil matters for car accidents and claims under $10,000 are referred straight to arbitration. Arbitration is a more streamlined process than a full hearing. It is still a formal process, and parties should prepare properly.

For larger or more complex claims, the court may list the matter for a pre-hearing conference or other dispute resolution step. The purpose is to see whether the matter can be resolved without a final hearing. If settlement is not reached, the matter may proceed to a hearing.

At a hearing, the court decides the dispute on the balance of probabilities. That means the court asks what is more likely than not. The court will consider liability and quantum. Liability concerns who was legally responsible. Quantum concerns the amount payable.

The magistrate may accept all of the claim. The magistrate may dismiss it. The magistrate may also award part of the amount claimed.

Claims above $100,000

Most ordinary vehicle damage claims will be below the Magistrates’ Court limit. Some claims may be higher. This can happen where the damaged vehicle is expensive, commercial equipment is involved or several losses are claimed together.

If the claim is above $100,000, it may need to be brought in a higher court. The Magistrates’ Court states that disputes over $100,000 are heard in a higher court. In practice, advice should be obtained before commencing a higher-value proceeding. The wrong forum can create delay and cost.

Time limits

Time limits matter. A claim for motor vehicle property damage should not be left indefinitely. In Victoria, many debt and property damage claims are subject to a six-year limitation period under the Limitation of Actions Act 1958. The Act remains the governing Victorian legislation for limitation periods.

The time usually runs from when the cause of action arose. In a car accident property damage claim, that will often be the date of the accident. Delay can create practical problems even before the limitation period expires. Evidence may disappear. Witnesses may become difficult to locate. Insurers may close files. Repair records may become harder to obtain.

If judgment is obtained, enforcement is a separate issue. A court order does not always mean immediate payment. If the defendant does not pay voluntarily, enforcement steps may be required. Community legal resources commonly explain that a 15-year period can apply where a court judgment has been entered.

How we can assist

Motor vehicle property damage claims can appear simple at first. Many become more difficult once liability, insurance, repair costs or enforcement are disputed.

We can assist with letters of demand, responses to demands, settlement negotiations and Magistrates’ Court proceedings. We can also advise on whether a claim is worth pursuing, whether a defence has merit and what evidence is needed.

For plaintiffs, early advice can help identify the correct defendant and prepare the claim properly. For defendants, early advice can help avoid default judgment and unnecessary admissions.

This page provides general information only. It is not legal advice. Anyone involved in a disputed motor vehicle property damage claim should obtain advice about their own situation.