Car accidents may cause personal injuries or damage to property and there is insurance to cover both. If an accident occurs, the damage may be handled through a court claim or paid out by insurers. Decisions need to be made by the parties about how they will manage the process.


Adrian Snodgrass

Principal Lawyer, Fitzroy Legal Service

Liability and damages

Last updated

1 July 2022

Liability and negligence

Liability means legal responsibility.

Negligence is an act that breaches a duty to take reasonable care and results in loss or damage to another person.

In deciding which person’s negligence caused an accident, evidence can be given by the drivers involved in the accident, and by their passengers who saw or heard anything relevant. However, the best evidence is that of independent witnesses, who were not involved in the accident. For example, people in other vehicles or pedestrians may have seen the accident or something relevant to it. Remember, if you are making a claim, you must prove that the other person was negligent.

It is necessary to distinguish between a ‘complaint or summons claiming damages’ and a ‘summons to answer a charge of committing an offence’. For example, if the police charge a person with failing to give way to the right, and that person is found guilty, it does not necessarily mean that the accident occurred solely because of that driver’s negligence. If you wish to sue that person for damages, it is possible that the court may still find you to be partly at fault (e.g. by travelling too fast, or not keeping a proper lookout).

In the same way, the fact that a person complied with all traffic regulations does not mean they are not in any way to blame for an accident, since it is often necessary to take more care than just obeying the road rules.


You must keep your loss as small as possible, and you must prove that the damages claimed were caused by the accident. First, obtain a detailed quote for the cost of repairing your vehicle. It is best to get at least two quotes. If you only get one quote, you must show that the single quote is reasonable, and the repairs cannot be done more cheaply elsewhere.

If your vehicle is so badly damaged that it will cost more to repair than the vehicle was worth before the accident, the vehicle is a ‘write-off’. In this situation, evidence must be obtained of what the vehicle’s market value was at the time of the accident. You cannot claim the replacement value of the vehicle, which may be higher. Your claim will be for the pre-accident market value less the value of the wreck (often called the ‘salvage’ amount).

Other expenses

Some vehicles (e.g. a taxi) may be essential for their owners to earn an income. If the owner cannot work while the vehicle is being repaired, they can claim lost wages. In some cases, another vehicle may be hired and the hire cost claimed. However, you must show that hiring another vehicle was essential, and that there was not a cheaper method (e.g. using public transport). It can be difficult to recover the cost of hiring another vehicle, so keep hire charges moderate.

If you are selling your vehicle at the time of the accident, make sure you obtain quotes for repairing the damage before selling the vehicle. If the vehicle is a total loss, obtain a loss assessor’s report before selling the vehicle; remember to deduct any salvage value from the market value of the vehicle.

In either case, it is advisable to have the vehicle assessed by a loss assessor so that, if necessary, you can prove the amount your vehicle depreciated as a result of the accident.

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