CAN I MAKE A DIMINISHED VALUE CLAIM?

  1. What is a diminished value claim?

If your car is in a serious accident, which requires substantial repairs, and despite those repairs, the car is worth less after successful repairs, than the car was worth before the accident took place you may be entitled to make a diminished value claim. Obvious examples include frame damage done to a new car. A purchaser of a used car is not willing to pay as much for a used car with previous frame damage even if repaired as they would for the same used car with no prior accident history. While it seems logical that this would be true for all cars that have previously been in an accident, the diminished value claim is the exception rather than the rule.

  1. Will the Insurance Company automatically offer the diminished value claim as part of the offer for your property damage?

The simple answer is no!  An insurance company will never bring up the issue of diminished value unless asked. More likely even if suggested, they will deny the remedy applies. However more insurance companies now have a specific unit that now deals exclusively with diminished value claims. For the Insurance companies that do not have a diminished value claim unit, it can be difficult to negotiate the diminished value claim.

  1. How do you prove a diminished value claim?

The best way to prove a diminished value claim is to hire an automobile appraiser who has an expertise in evaluating diminished value claims. The insurance company has appraisers who do these estimates for the insurance company and you should have an appraiser that does the same thing for your side. Just like any other injury this is not an agreed upon science and each side is likely to have a different opinion. The insurance company opinion is likely to be favorable to the insurance company so you need an appraiser likely to be favorable to your position.

  1. When should I make a diminished value claim?

Hiring an expert can be costly ($350.00 or more), so you need to make sure the claim is not frivolous. Factors favorable to a successful diminished value claim include:

  1. The newer the car the more likely prior damage will affect the future value of the car
  2. The more extensive the damage
  3. Body damage vs. frame or mechanical damage
  4. Make of car
  5. The most relevant Maryland case on diminished value claims is William Kruvant v. Christopher Dickerman ,18 Md App 1,  305 A.2d 227(1973)

The measure of damages applied to a motor vehicle which has not been entirely destroyed has been clearly enunciated. In Taylor v. King, 241 Md. 50, 54-55, 213 A.2d 504, 507 (1965), the Court of Appeals said:
“… the rule in Maryland with respect to the measure of damages for injury to a motor vehicle, which has not been entirely destroyed, is the reasonable cost of the repairs necessary to restore it to substantially the same condition that it was in before the injury, provided the cost of repairs is less than the diminution in market value due to the injury. And when the cost of restoring a motor 3*3 vehicle to substantially the same condition is greater than the diminution in market value, the measure of damages is the difference between its market value immediately before and immediately after the injury.” (Footnote omitted.)
While Taylor establishes the standard by which we measure damages, it is silent as to burden of proof. It tells us that in order to determine the amount of recovery it is necessary to know at least three facts: the cost of repairs, the value of the vehicle immediately before the injury, and the value of the vehicle immediately after the injury. But it does not tell us whether the owner of the damaged vehicle or the party who caused the damage must prove those facts.
Supported by the concurrence of textwriters and other state courts, we conclude that the appropriate rule with respect to the burden of proof in a case involving damage to a motor vehicle which has not been destroyed is that the owner of the damaged vehicle has the burden of proving his damage, and may do so by proving either the cost of repairs or the diminution in the value of the vehicle after the damage in order to establish a prima facie case. The party causing the damage then has the burden of showing that the plaintiff’s evidence is not the proper measure of damages by offering evidence that the option not pursued by the owner would cost him less.
The appellee contends that certain language in Fred Frederick Motors v. Krause, 12 MdApp. 62, 277 A.2d 464 (1971), has determined the issue and has placed the burden 7*7 of proving both the cost of repairs and the value of the vehicle immediately before and after the collision on the plaintiff. We do not agree. In Krause, this Court recognized that the language of the Taylor requirement, that the repairs restore the automobile to “substantially the same condition” that it was in before the injury, neither defined nor described fully that condition. The Court noted that the phrase was susceptible to two interpretations: either the car could be restored to its previous physical appearance and mechanical function, or it could be restored to its market value before the injury. In an effort to clarify Taylor, the Court said,
“Therefore, if the plaintiff can prove that after repairs his vehicle has a diminished market value from being injured, then he can recover in addition to the cost of repairs the diminution in market value, provided the two together do not exceed the diminution in value prior to the repairs.” 12 MdApp. at 66-67, 277 A.2d at 467. (Emphasis added.)
In Krause, the Court was concerned only with an explication of the measure of damages enunciated in Taylor and not with an assessment of the burden of proof.
While the Krause rule does require the owner of the damaged vehicle to prove diminuted market value after repairs, it contains no such requirement with respect to proof that the cost of repairs coupled with the diminution in market value does not exceed the diminution in value prior to the repairs. Indeed, in our view, for the reasons set forth above, when a plaintiff has established a prima facie case by proving his damage, according to one acceptable measure of damage, it becomes the obligation of the defendant to offer evidence that the damage would be less under a different acceptable measure of damage.
In the instant case, the appellants sued for the cost of repairs, loss of the use of the vehicle, and a decrease in the value of the vehicle after repairs. The appellee admitted negligence, and the sole issue of damages was tried to a jury with Judge James F. Couch, Jr. presiding. It appears from 8*8 the record that the appellants had purchased their 1960 Mercedes Benz 220 SE coupe on May 22, 1969, approximately three weeks prior to the accident. They paid $2,400 for it, which was assumed to be its value immediately before the accident. After the accident, the appellants were charged $1,820.29 for repairs associated with the accident, an amount which a qualified expert testified was fair and reasonable. They paid $60 for rental of a car during the twelve days the car was being repaired, also an amount which a qualified expert testified was fair and reasonable. The appellants introduced no evidence as to the market value of the automobile immediately after the accident and before the repairs. They unsuccessfully attempted to qualify an expert to testify as to the value of the car after repairs. At the conclusion of the appellants’ case, Judge Couch ruled that the appellants had not established a prima facie case with respect to damages for injury to the vehicle or diminution of the value of the car after repairs and directed a verdict for $61: $60 for loss of use of the vehicle during the period of repair and $1 nominal damages. We remand the case for retrial as to the amount of damages for injury to the vehicle under the principles set forth herein.
With respect to appellant’s claim for damages for the diminution in the value of the vehicle after repairs, one further issue should be resolved for the guidance of the lower court. Maryland Rule 1085. The question concerns the qualification of the expert witness offered by the appellants to testify on the diminuted value after repairs.
In Pennsylvania Thresherman and Farmers’ Mutual Casualty Insurance Co. v. Messenger, 181 Md. 295, 302, 29 A.2d 653, 656 (1943), the Court of Appeals said:
“It is a general rule of evidence, quite liberally applied by the courts of this country, that anyone familiar with the value of property is competent to testify as to its value. If a person shows that he has sufficient personal knowledge of motor vehicles to make relevant his opinion regarding the value of the motor vehicle in question, the credibility and 9*9 weight of his testimony are for the consideration of the jury. Alabama Power Co. v. Armour & Co., 207 Ala. 15, 92 So. 111.”
In commenting upon the type and degree of knowledge which a witness must possess in order to be entitled to testify on the value of property, Wigmore states:
“The uncertainty arises from the fact that observation or knowledge of a thing involves, in these instances, two elements: acquaintance with the object or article itself, and acquaintance with the class of things into which it is desired to put the object. For example, knowledge of the value of a horse involves, first, a knowledge of the values of the different grades of horses, and, secondly, knowledge of the appearance and qualities of the particular horse, and the operation of estimating its value consists in comparing it with the several possible classes or grades and then placing it in one of them. It follows that the observation or knowledge necessary in such cases is twofold, — knowledge of values generally or the conditions affecting values, and knowledge of the thing to be valued.” Wigmore on Evidence, § 558 at 638 (3d ed. 1940).
In the instant case, Mr. Samuel Ladden, the owner and operator of the automobile repair shop at which appellants’ car was repaired, qualified as an expert in the repair of automobiles and testified as to the cost of repairs. The appellants then attempted to qualify him as an expert to testify on the value of the vehicle after repairs. Mr. Ladden testified that in addition to having been in the repair business for some 21 years, he also was a licensed used car salesman and had run a used car lot for 13 years. He said that at the time of the trial he had about 20 cars for sale, including a number of Porsches and Volkswagens, a number of Chevrolets “ranging from 1956 through 1969,” a 1971 Dodge Coronet and “a couple of MGs.” He stated that 10*10 incidental to the type of work he did, he had become involved in the inspection and appraisal of certain types of unique and classic automobiles and that he had himself purchased and resold such cars on a number of occasions and had assisted his customers in obtaining such automobiles. He indicated that he thought he was familiar with the market values of used motor vehicles in his locality. On cross-examination, Mr. Ladden was asked when he had last had a 1960 Mercedes Benz 220 SE coupe on his lot for sale. He replied, “I have never had one on my lot for sale, and they are very, very rare.” Immediately thereafter, Judge Couch sustained appellee’s objection to the witness’s qualification as an expert to testify to the diminution in the value of appellants’ vehicle after repairs.
We feel that Mr. Ladden was qualified to offer his opinion as to the value of the vehicle after repairs. His testimony established that the 1960 Mercedes Benz 220 SE coupe was a rare and unique automobile; that he had knowledge of and acquaintance with the class of unique and classic automobiles and their values generally in the locality; and that, having repaired the vehicle in question, he had intimate knowledge of the condition of the specific automobile to be valued. The fact that he himself had neither purchased nor sold a 1960 Mercedes Benz 220 SE coupe properly affects the weight accorded his opinion, but it does not affect his competency as an expert and should not have disqualified him. Smith v. Armstrong, 121 Mont. 377, 198 P.2d 795 (1948)Leider v. Pitock, 15 N.J. Super. 592, 83 A.2d 796, 797 (1951)Wigmore on Evidence, § 714 at 46, § 716 at 54 (Chadbourn Rev.); Jones on Evidence, § 14:50 at 730 (6th ed. 1972). Nor should his failure to indicate knowledge of comparable sales bar his testimony. First National Realty Corp. v. State Roads Comm’n., 255 Md. 605, 613-14, 258 A.2d 419, 423-24 (1960)Turner v. State Roads Comm’n., 213 Md. 428, 433, 132 A.2d 455, 457 (1957). In our view, the experience and knowledge of Mr. Ladden was such that he was entitled to testify. We have no doubt that his opinion would aid the trier of fact. Consolidated Mechanical Contractors Inc. v. Ball, 263 Md. 328, 338, 283 A.2d 154, 158 (1971)Sun Cab Co. 11*11 v. Walston, 15 MdApp. 113, 141-43, 289 A.2d 804, 820-21 (1972), aff’d, 267 Md. 559, 298 A.2d 391 (1973).
 
241 Md. 50 (1965)
213 A.2d 504
TAYLOR
v.
KING

[No. 7, September Term, 1965.]Court of Appeals of Maryland.
Decided December 21, 1965.
51*51 The cause was argued before PRESCOTT, C.J., and HAMMOND, HORNEY, OPPENHEIMER and McWILLIAMS, JJ.
Hugh A. McMullen and William H. Geppert, with whom were Gunter & Geppert on the brief, for the appellant.
Fred H. Anderson, with whom were Anderson, Mullen & Bowen on the brief, for the appellee.
HORNEY, J., delivered the opinion of the Court.
This appeal, arising out of a suit for damages resulting from a collision of motor vehicles, presents a question as to which method should be used in computing the amount of damages for injury to an automobile which was not completely destroyed.
The automobile operated by a son of William R. King (the appellee) was struck in the rear and extensively damaged by a motor vehicle operated by George N. Taylor (the appellant). Since no defense was made by the appellant as to his liability, the only question before the lower court was the amount of damages to be awarded the appellee for the injury to his automobile.
It appears from the record that the appellee had purchased a new automobile about two months prior to the accident for $3192.49 and that at the time of the accident it was worth $3127.43. The only estimate obtained as to the cost of repairing the automobile totaled $1118.21, but the appellee decided not to repair the automobile and sold it for salvage for $975 which was the highest of several offers he received. The lower court entered a judgment of $2182.43 — the difference between the value of the automobile prior to the accident and its value after the accident established by deducting the salvage price from the depreciated value and adding the towing charge of $30.
The main contention of the appellant is that the lower court erred in awarding damages in that the award should only have been $1148.21 — the estimated cost of repairs plus the towing charge. The appellant asserts that “where a motor vehicle is damaged but can be fully repaired for less than the market value of the automobile after it is repaired, then the true measure of 52*52 damages is the cost of repairing the motor vehicle.” The appellee contends that “the basic rule for the measure of damages for partial destruction of or injury to [an automobile] is the difference in value of the [automobile] immediately before and after the injury but an alternative measure is reasonable cost of repairs necessary to restore it to its former condition.”
Although the parties have stated different rules, the point of disagreement between them, on the question of the measure of damages, is not which rule should be applied but rather the issue is whether the automobile of the appellee could reasonably have been restored, by repairing it, to substantially the same condition that it was in before the accident. The measure of damages advanced by the parties is said to be the difference between the market value of the automobile immediately before the injury and its market value immediately after the injury if the automobile cannot be “fully repaired,” as the appellant phrased it, or “restored to its former condition,” as the appellee expressed it.
On the question as to whether the damaged automobile could reasonably have been restored by repairs to substantially the same condition that it was in before the accident, there are insufficient facts to make a determination. The only evidence in the record which is even close to being relevant to the issue is the testimony of the appellee who, in reply to a question as to why he did not have the automobile repaired, stated that “in the case where a frame and body structure have to be straightened to the extent that this car would have to be straightened [he] felt that by straightening those members the car would have been weakened more and would not have been put in a safe acceptable condition for future use.” Although it appears that the appellee was possibly qualified to testify as an expert witness, in view of the fact that he had been for many years the supervisor of maintenance, repairs and purchasing for the trucking division of a trucking company and had had responsibilities in respect to repairing and maintenance of the company vehicles, his testimony was not sufficient positive evidence of whether the automobile could or could not be restored by being repaired to substantially the same condition that it was in before the accident, at reasonable costs. Evidence should have been presented 53*53 as to how extensively the frame and body were damaged and whether these conditions could or could not have been corrected. Since we cannot make a determination of the question of fact, we shall, pursuant to Maryland Rule 871 a, remand the case without affirmance or reversal for the taking of additional evidence limited to the question of whether the automobile could have been substantially restored at reasonable cost by repairing the injury sustained as a result of the collision.
Although this might be a sufficient disposition of the case under ordinary circumstances, we think that the parties, having asserted conflicting rules of law, are entitled to a concise statement of the law when there is a question as to which method should be used in computing the amount of damages for injury to an automobile which was not completely destroyed. See Rule 885.
In Western Maryland R.R. v. Martin, 110 Md. 554, 73 Atl. 267 (1909), where injury had been done to household furniture by water which the defendant negligently caused to overflow on to the property of the plaintiff, this Court promulgated the rule that the measure of damages would be the cost of repairing the furniture if it was merely damaged and would be its value at the time of its destruction if it was entirely destroyed.
In the subsequent case of W.B. & A. Ry. v. Fingles, 135 Md. 574, 109 Atl. 431 (1920), an action brought for damage to an automobile, the Court, in considering a question as to the measure of damages for the injury, said at p. 579 (citing Corpus Juris) that “the measure of damages for injury to personal property, which has not been entirely destroyed, * * * is the cost of repairing the property together with the value of the use of the property during the time it would take to repair it.”
In Fisher v. City Dairy Co., 137 Md. 601, 113 Atl. 95 (1921), where suit was also brought to recover damages for injury to an automobile, the Court reiterated the rule stated in the Fingles case, as the applicable law, and specifically rejected an instruction which informed the jury “that the true measure of plaintiffs’ damages in this case,” where, as the Court pointed out, the automobile was not destroyed by the collision, and the car was capable of being repaired, at a reasonable cost, was “the 54*54 difference between the value of the plaintiffs’ automobile immediately preceding the accident complained of and its value immediately thereafter.”
And in Mullan v. Hacker, 187 Md. 261, 49 A.2d 640 (1946), where the action concerned the recovery of damages to an automobile garage as a result of an excavation on adjoining property, it was said that the measure of damages was the cost of repairing the garage if it could be restored to the condition it was in before the injury without cost disproportionate to the injury and that when the cost of restoration is greater than the diminution in market value, the measure of damages is the difference between the value of the property before and after its injury. The rule is as applicable to personal property as it is to real property. See Superior Construction Co. v. Elmo, 204 Md. 1, 102 A.2d 739 (1954).
Until now, we have not had to consider a case in which there was a possibility that the injured automobile could not be restored to its prior condition.
The various statements in Martin, Fingles, Fisher and Mullan make it clear that the rule in Maryland[1] with respect to the measure of damages for injury to a motor vehicle, which has not been entirely destroyed, is the reasonable cost of the 55*55repairs necessary to restore it to substantially the same condition that it was in before the injury, provided the cost of repairs is less than the diminution in market value due to the injury. And when the cost of restoring a motor vehicle to substantially the same condition is greater than the diminution in market value, the measure of damages is the difference between its market value immediately before and immediately after the injury. In addition, the measure of damages may include a reasonable allowance for loss of use of the vehicle.
Remanded without affirmance or reversal for the taking of additional evidence and a redetermination of the amount of damages in conformity with this opinion; the costs to abide the outcome.
[1] The courts are far from being in accord as to what the rule in this area ought to be. There are several rules and numerous variations of some of them. To discuss them at length and compare the difference between them would require a footnote considerably longer than this opinion which in the end would probably serve no useful purpose. Most of the cases decided prior to 1956 are referred to in the footnotes (70 through 89) to an article on the subject by James Fleming, Jr., entitled DAMAGES IN ACCIDENT CASES, published in 41 Cornell Law Quarterly, at p. 593. Other cases not referred to in the article or decided since publication, include Wright v. Capital Transit Co., 35 A.2d 183 (D.C. Mun. Ct. Appls. 1943)Hemminger v. Scott, 111 A.2d 619 (D.C. Mun. Ct. Appls. 1955)Knox v. Akowskey, 116 A.2d 406 (D.C. Mun. Ct. Appls. 1955)Teitsworth v. Kempski, 127 A.2d 237 (Del. 1956)The Nyland, 164 F. Supp. 741 (D.C. Md. 1958)Falter v. City of Toledo, 158 N.E.2d 893 (Ohio 1959)Alber v. Wise, 166 A.2d 141 (Del. 1960)Sanft v. Haisfield, 178 A.2d 791 (Pa. Super. 1962); and Brewer v. Drain, 192 A.2d 532 (D.C. Ct. of Appls. 1963).

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