Three Strikes and ICBC’s Out! – Insurer’s Denial of Accelerated Vehicle Depreciation Fails Again
For the third time in one month ICBC has been ordered by the Civil Resolution Tribunal to pay a vehicle owner damages for accelerated depreciation following a vehicle collision.
When a vehicle is damaged in a crash it often suffers a significant loss of market value, even after all reasonable repairs are done. ICBC chooses to ignore this reality when dealing with crash victims and raises invalid arguments trying to deny such claims. For the third time in one month the Civil Resolution Tribunal has held ICBC insured driver liable for paying such damages.
In the most recent case (Herriott v. Yuen) the Applicant’s Audi Quattro sustained over $10,000 in damages in a crash that the Respondent admitted fault for. After the vehicle was repaired both the Applicant’s dealership and an expert appraiser noted there was an accelerated depreciation in the vehicle’s remaining market value. ICBC denied this claim arguing the vehicle is worth no less than it would be even without such a significant crash. In rejecting ICBC’s position and ordering damages paid recognizing the accelerated depreciation CRT Vice Chair Andrea Ritchie provided the following reasons:
14. Herriott submitted a May 29, 2019 “Preliminary Accelerated Depreciation Report” by Robert Fournier of Fournier Auto Group Ltd. (Fournier Report), along with an Excel workbook of Mr. Fournier’s research and calculations. The Fournier Report explains Mr. Fournier has 15 years’ experience doing motor vehicle market value valuations and has been providing accelerated depreciation reports with the Fournier Auto Group Ltd. since 2013. Mr. Fournier’s qualifications are not in dispute. I accept the Fournier Report as expert evidence under CRT rule 8.3(3).
15.In his report, Mr. Fournier noted mass-production vehicles, such as the Audi, normally naturally depreciate 5% to 25% in the first year, and 5% to 20% every year after that. Mr. Fournier reviewed Mr. Herriott’s Audi, photographs of the damage from the April 24, 2019, as well as the “repair supplement” which set out the Audi’s necessary repairs post-accident. Mr. Fournier assumed the Audi had not previously suffered any damage cumulatively exceeding $2,000 and found that the Audi was in “average” condition at the time of the accident. Based on market research and Mr. Fournier’s own expertise, he valued the Audi pre-accident at approximately $18,645 retail.
16. Fournier then addressed the Audi’s post-accident market value. He determined the repairs were mostly cosmetic, with minor mechanical/electrical repairs and no structural damage. Mr. Fournier concluded that the April 24, 2019 accident reduced the Audi’s market value by 14% to 15%, or approximately $2,610 to $2,795….
21.In support of his assertion that the Audi has not lost any value as a result of the April 24, 2019 accident, Mr. Yuen submitted an “Accelerated Depreciation Report” by Kelly Stapleton, an ICBC Estimating Services Manager (ICBC Report). The ICBC Report states Mr. Stapleton has been with ICBC for 20 years, and has spent the last 10 years as a “Vehicle Settlement Rep/appraiser” in the Estimating Services department, which included assessing vehicle damages and kinds of loss. I accept Mr. Stapleton’s qualifications and as Mr. Herriott did not object to my receiving the ICBC Report as expert evidence, I accept it under CRT rule 8.3(3).
22.In his report, Mr. Stapleton said the Audi’s market value “at time of loss” was $17,362.62. It is unclear to me whether “at the time of loss” means immediately before the accident or after the accident. In either case, Mr. Stapleton did not provide another value for the vehicle, meaning a corresponding pre- or post-accident value.
23. Stapleton attached various listings for similar vehicles, ranging from $23,000 to $24,894 for vehicles that had not been in an accident, and $17,495 to $21,900 for vehicles that had been in an accident with damage exceeding $2,000. Admittedly, Mr. Stapleton advised the amounts would need to be adjusted to reflect the Audi’s specific trim line and engine configuration, but did not make these adjustments. Therefore, I find the valuations as provided by Mr. Stapleton to be of little value, except to note that they indeed show a decrease in value between similar vehicles with and without accident damage. Additionally, Mr. Stapleton stated in his report that Mr. Fournier failed to consider the Audi’s pre-existing damage, which as noted above, I find is incorrect. Given these shortcomings, I find the ICBC Report of little assistance.
24.Based on all the above, on balance, I prefer Mr. Fournier’s evidence on the Audi’s estimated value and its accelerated depreciation. I find it more likely than not that the April 24, 2019 collision caused the repaired Audi to depreciate more quickly than it would have if the accident had not occurred. Although Mr. Herriott claims $2,795, the top end of the estimated loss given by Mr. Fournier, he did not provide any evidence as to why he would be entitled to the high end of the range. I find Mr. Herriott has not proven he is entitled to more than the low end of Mr. Fournier’s given range, or $2,610. I find Mr. Yuen must pay Mr. Herriott $2,610 in damages for accelerated depreciation.