Brand New Car Hit While Parked, Need help with diminshed value claim

[missamy]

California

Hi There,
My brand new 2006 cadillac cts fully loaded 240 miles, was rear ended while parked, no one was injured. Damage to vehicle is nearly $7000.00 and there is structural damage as well. The other partys insurer accepted 100% liability.

I received an auto appraisal to determine pre-accident value versus post-accident value. It has been determined to be roughly, a $12,000.00 loss in value.

This is of great concern to me as I would really like to trade it in for the same car that has not been in a wreck and am willing to pay a few thousand to be whole, however even with my paying a few extra on top of the trade in, I would still be at least 10-12 thousand short of being whole, and being able to get back into a perfect car.

I have been unable to locate much information with regard to this type of claim in my state however I have been told that my claim, being on a brand new car & it being 3rd party liability, that I am in a great position to recover for some of this loss.

Can anyone tell me how this works or if they know of any measures I should take? Is there an certain type of lawyer I should look for if the insurance company rejects my claim?
Thank you for any help you can offer

 

[stephenk]

Not many attorneys will take the case on a contingency (is paid with a % of the case settlement)since there is no money likely to be won for you other than the car value. You may find an attorney who will work on an hourly basis.

How much frame damage to the car (How many hours on the frame straightener)? What was your car worth at the time of the accident?

the problem with diminished value claims is that it is a subjective matter on what your car is worth. It is all based on what you hope someone would pay for your car and being unable to find anyone to pay that amount (because of the damage to the car). however, if the car can be fixed to its pre-accident condition, your diminished value claim is hard to prove.

Since you just bought the car, how long were you planning on keeping it? If you are going to keep the car for more than 5 years, again, your diminished value claim is weaker.

 

[teflon_jones]

California does not support diminished value claims.

 

[JETX]

My brand new 2006 cadillac cts fully loaded 240 miles, was rear ended while parked, no one was injured. Damage to vehicle is nearly $7000.00 and there is structural damage as well. The other partys insurer accepted 100% liability.

I received an auto appraisal to determine pre-accident value versus post-accident value. It has been determined to be roughly, a $12,000.00 loss in value.

What I believe you are trying to claim is called 'diminished value' (or 'diminution in market value').
And though you are trying to make that claim against the other party's insurance (and not yours), similar claims in California haven't done well.
'The California Court of Appeal in Ray v. Farmers Insurance Exchange, 200 Cal. App. 3d 1411, 246 Cal. Rptr. 593 (Cal.App.Dist.3 05/05/1988) concluded “We will not rewrite an otherwise unambiguous limitation of collision coverage to provide for a risk not bargained for. To the extent Ray's automobile was repaired to its preaccident safe, mechanical, and cosmetic condition, Farmer's obligation under the policy of insurance to repair to "like kind and quality" was discharged.”

Alto, in State Farm Fire and Casualty Co v. Superior Court of San Diego County, 215 Cal.App.3d 1435, 264 Cal. Rptr 269 (1989) the court held:

"Diminution in market value" is not a "peril" at all; it is a method of measuring damages. As was stated in Geddes: "'The measure of damages is the diminution in the market value of the building ...'" (Geddes & Smith, Inc. v. St. Paul Mercury Indemnity Co., supra, 51 Cal 2d 558, 565...)This language from Geddes was quoted by the Eichler court to support its conclusion the diminution in the market value of the home was a "separate and distinct" loss. (citations omitted. [D]amage to other property could be measured by the repair or replacement cost or by the diminution in value to the entire property caused by the presence of the defective product. ... Neither diminution in value nor the cost of repair or replacement are active physical forces -- they are not the cause of the damage to the structures; they are the measure of the loss or damage. ... diminution of market value is not specifically excluded because it is not a "cause" of loss; it is the measure of a loss caused by something else.

Recovery for tort damages is therefore limited to the difference between the fair market value of the object before loss and its value after loss. Whether that is enough to repair or replace the item of property is irrelevant.

This is of great concern to me as I would really like to trade it in for the same car that has not been in a wreck and am willing to pay a few thousand to be whole, however even with my paying a few extra on top of the trade in, I would still be at least 10-12 thousand short of being whole, and being able to get back into a perfect car.

The insurance company is only required to return the car back to its "preaccident safe, mechanical, and cosmetic condition".

 

[missamy]

Hi there,
I was planning on keeping it for 4-5 years however now I do not want this car anymore, and would prefer a perfect one. I appears that pre-accident condition is next to impossible on a perfect, brand new car with the amount of damage it sustained. At a glance it looks okay but the paint seems "off" in places and things arent perfectly aligned.
I am not sure about frame damage. They claim there was none however on the repair estimate there was an item stating: PULLING 1.5 hours, which appears to be something they didnt replace and seemingly structural.
Those are some of the reasons I no longer love it the same way I did when I purchased it (a couple of weeks before the accident).
However these flaws don't seem to have alot to do with diminshed value, as dimished value plays in when I try to trade it in so that issue is entirely independent from the flaws.
In Farmers Insurance/Ray, I thought that was a 1st party insurance claim therefore whatever exclusions were in his policy were what previailed. I thought that those exclusions do not necessarily apply to 3rd party claims since they/me are not under that particular contract.
I also thought that with used cars, diminished value is obviously more difficult to determine due to the difficulty in substantiating the true pre-loss condition and value. However with a brand new car, those some questions are not really a factor.
Anyhow, If I am supposed to be returned to pre-accident condition then it is hard to believe that I am supposed settle for a not-so-perfect vehicle with a not-as-high value.
Of course, however, law is law.
Is there a particualr field of law where I might begin to look for an attorney (not on contigency)?
In a perfect world if the insurance company really believed my car is worth the same as it used to be, they would take my car and sell it, and keep the proceeds and then give me what it WAS worth so I could buy another as it is not the money I am after I just find that the only way I will be whole is to have a perfect car that is can be sold for full market value when the day comes.
Thank you all for your comments and assistance!

 

[JETX]

I was planning on keeping it for 4-5 years

'Plans' change.

however now I do not want this car anymore

And you are certainly free to make that choice.

and would prefer a perfect one.

Of course you do. However, you have no LEGAL right to demand or expect one.

but the paint seems "off" in places and things arent perfectly aligned.

Simple.... don't accept the vehicle from the shop until it is done correctly. Also, those complaints are against the work the shop did.... the other drivers insurance company has nothing to do with that.

I am not sure about frame damage. They claim there was none however on the repair estimate there was an item stating: PULLING 1.5 hours, which appears to be something they didnt replace and seemingly structural.

So, rather than your guessing, what EXACTLY did the shop say when you asked them to clarify that??

Those are some of the reasons I no longer love it the same way I did when I purchased it (a couple of weeks before the accident).

Ah, Love is a many splendored thing!!

However these flaws don't seem to have alot to do with diminshed value, as dimished value plays in when I try to trade it in so that issue is entirely independent from the flaws.
In Farmers Insurance/Ray, I thought that was a 1st party insurance claim therefore whatever exclusions were in his policy were what previailed. I thought that those exclusions do not necessarily apply to 3rd party claims since they/me are not under that particular contract.

I started to include that in my post, but felt it would stray to far... so, I will return to it now.
You may have a 3rd party 'diminished value' claim against the at fault driver. However, if they deny your DV claim... your only option is as you have already found.... a lawsuit. The DV claim you make (some $17k) is likely VERY inflated and more like something less than $5k. Simply too small an amount for an attorney to consider on contingent fee basis. You will have to pay for that one out-of-pocket. And since the costs will likely exceed the $5k possible award.... not really economically practical. There is a good article on this 3rd party problem under 'Third Party Diminished Value: Too Small to Litigate?' at: vhttp://www.vehicleinfo.com/AutoMuse/archives/diminished_value/

And more at:
http://www.asashop.org/autoinc/dec97/dv.htm

 

[missamy]

Quote:
and would prefer a perfect one.

Of course you do. However, you have no LEGAL right to demand or expect one.

I am not sure that is entirely true. The insurance company sent me a letter stating:
"your vehicle will be restored to its condition prior to the loss"

Even if this is possible from a VISUAL standpoint, if my car is WORTH substantially less than it was prior to the loss, how can it also be in the same condiditon it was prior?

I have already talked to my salesman at Cadillac who concurs that this car cannot be sold on the lot as a ceritified vehicle and would go straight to auction therefore the trade in value would be less.

If it cannot be sold as a certified car on a Cadillac Lot as a direct result of the accident, how is it in the condition prior to the loss?

In any case I realize that hiring an attorney may not be cot effective but can anyone tell me if small claims court may be a viable solution?

Incidentally, the post accident calue is estimated at 1/3 or $12,000.00 not 17.

Thanks again.

 

[teflon_jones]

"Pulling" probably refers to a pulling dents out, rather than replacing a body panel. It's standard practice and is preferable to replacing the body panel in most cases.

 

[missamy]

California

Everything that was damaged on the outside of the car WAS REPLACED so the pulling had to be UNDERneath.

 

[JETX]

Missamy... You have already been advised that your claim is likely not worth litigating... and certainly not on a contingent fee basis.
Your options are to either accept the fact that your car is repaired.... or to pursue your claim against the other driver in court.

 

[missamy]

Thanks!

I was asking about my chances in small claims court, not litigation.

 

[JETX]

I was asking about my chances in small claims court, not litigation.

Gee, and what the hell do you think small claims court is???

litigation
n. any lawsuit or other resort to the courts to determine a legal question or matter.

 

[dallas702]

You need to do some research on the structure of your car. Most new cars have crushable frames that may or may not be able to be repaired. This is what the insurance companies begged and lobbied for so the occupants of the car would receive less severe injuries. I'm just not familiar enough with the overall structure of the '06 Cad to be of much help, but there are resources who can tell you exactly how that car should "crush", and at what point it can be restored to normal...with ALL body and hardware integrity as new.

That's the hard part. Pulling the rear structure straight doesn't guarantee the alignment of all the panels and stress points up through the front subframe. I'm not saying it can't be repaired, but it darn sure won't be the same car. I'd rather have it "clipped" from some point backward, but even that doesn't guarantee the front doorframes and fender supports will be or stay aligned. You have to have another good bodyman inspect the whole car to make sure every panel gap and support point is exactly right.

Then there's the little things like all the lock and window mechanisms that are barely adequate without being clobbered. And the airbag system...and the stereo...and the rear a/c system...and, and....

Good luck.