Coles v Hetherton: The Objective Standard That Still Shapes Diminution Claims
The Court of Appeal’s decision in Coles v Hetherton [2013] EWCA Civ 1704 remains an important authority in motor insurance litigation. While it is often relied upon in disputes over diminution in value, its real boon lies in the guidance it provides on how reasonableness should be assessed when valuing a claim.
An Objective, Market‑Based Test
The case arose from a repair scheme operated by RSA, under which repairs were arranged through an insurer‑linked organisation. The cost of those repairs was higher than would usually be expected if a private individual had instructed an independent local repairer. The defendants argued that the charges were therefore excessive and unreasonable.
The Court of Appeal found that the proper measure of loss is the reduction in value of the damaged vehicle. In most cases, that loss is reflected by the reasonable cost of repair.
Importantly, the court made clear that reasonableness is not assessed by reference to what the claimant actually paid, nor by the insurer’s own commercial or contractual arrangements. Instead, the court framed the key question as:
What would a reasonable person in the claimant’s position have paid for those repairs, carried out to an appropriate professional standard?
The reasonable cost of repair is used as a practical measure of the vehicle’s loss in value and must be assessed independently of any financial arrangements between insurers, repairers or claims handlers.
The Role of the Trial Judge
A central feature of Coles is the discretion given to the trial judge. Judges are not bound by the claimant’s invoice, nor are they required to accept an insurer’s pricing model simply because it exists. An invoice may be evidence, but it is not decisive.
The court made clear that the judge’s role is to assess the market as a whole. In doing so, Coles places the trial judge firmly in the role of assessing objective value, rather than simply accepting the figures presented by either party.
A Practical Framework for Defendants
Coles v Hetherton is sometimes seen as a claimant‑friendly decision, but that interpretation misses its wider significance. By confirming that reasonableness is an objective test, the Court of Appeal made clear that repair claims can be challenged - provided the challenge is supported by credible market evidence.
That approach was applied successfully in a recent case handled by Carpenters Group. The claimant sought almost £6,000 in repair costs. The defence relied on independent market evidence, including data sourced from Auto Trader, showing that comparable vehicles of a similar age and mileage had an average market value of just over £3,800.
Taking depreciation into account and adopting a broad‑brush but evidence‑based assessment, the defence advanced a significantly lower figure. The judge preferred that analysis and awarded the reduced sum, resulting in a substantial saving for the client.
Conclusion
Coles v Hetherton confirms that claimants are entitled to recover the diminution in value of their damaged chattel, but it does not amount to a blank cheque. By firmly rooting reasonableness in an objective, market‑based assessment, the Court of Appeal provided a clear and practical framework for dealing with disputed claims.
The message is straightforward: where defendants can show, through reliable evidence, that the sums sought fall within the realms of what is not reasonable, they give the court the tools it needs to reach a fair and proportionate outcome.
