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No Diminution of Value in NJ??
Posted by: ItsMeAlison
Date: July 28, 2009 01:59PM
Hello,
My car was recently hit by another vehicle and was just told that there is no diminution of value for my vehicle. My car is still in the shop (3 weeks now) and the damage is exceeding $4,000. Since the other person was totally at fault their ins. co. is paying for the repairs and giving me a rental car. If there is no diminution value in the state of NJ, then how do I recover the loss of worth to my vehicle?
Thanks!
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Re: No Diminution of Value in NJ??
Posted by: Gutenberg
Date: July 28, 2009 02:06PM
You do what all red-blooded Americans do, you start wearing a neck collar and sue for pain and suffering.
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Re: No Diminution of Value in NJ??
Posted by: C(-)ris
Date: July 28, 2009 02:20PM
I'm a bit confused as to what you are talking about. If her insurance company is paying for a rental car for you and all the costs to repair your car what else do you want?
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Re: No Diminution of Value in NJ??
Posted by: TLB
Date: July 28, 2009 02:30PM
I wouldn't think it would be a state issue, but rather a policy issue. My guess is that the insured party's liability coverage does not cover diminished value only repair or replacement. In that case you would have to sue, but you could probably do it directly instead of the roundabout way Gute suggested.
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Re: No Diminution of Value in NJ??
Posted by: AlphaDog
Date: July 28, 2009 02:56PM
Quote
C(-)ris
I'm a bit confused as to what you are talking about. If her insurance company is paying for a rental car for you and all the costs to repair your car what else do you want?

The OP is after additional cash, based on the assumption that a car that has been wrecked will not command the same price at time of sale as an identical model that had never been wrecked. I understand the concept, but there are so many variables that I am on the fence about whether or not it's a valid position to take. If a vehicle sustained very heavy damage, particularly with frame damage, I can see the point. However, many fender benders are more likely to produce a car that looks just as good if not better than a vehicle that had never had body work done.
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Re: No Diminution of Value in NJ??
Posted by: billb
Date: July 28, 2009 03:07PM
I thought that only applied to first-party claims.
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Re: No Diminution of Value in NJ??
Posted by: Acer
Date: July 28, 2009 03:31PM
I think insurance companies have agreed to stay away from it because it's so subjective.

Unless it's a very expensive/classic car, I doubt the diminution is going to be worth the hassle of suing for it.

And really, $4000 seems like a lot, but it does not take much damage to get that high. Just replacing a bumper assembly and a hood or couple of fenders with no damage to the engine or frame can approach those figures quickly.

But if the OP wants to pursue it, googling "diminution of value" will bring up a firm or two willing to advise.
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Re: No Diminution of Value in NJ??
Posted by: ItsMeAlison
Date: July 28, 2009 04:16PM
Imagine two vehicles parked side by side - both are the same year, make and model, both with the same options, both with the same mileage, they're even the same color. The only difference is that one recently had $8,000 worth of collision repairs. If the price were the same, the only difference being the accident history, which one would you buy ? (Exactly!!! - that's the concept of diminished value)

The difference in the amount you'd be willing to pay between the two vehicles - the amount the price of the previously damaged vehicle would have to be reduced - is the diminished value.
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Re: No Diminution of Value in NJ??
Posted by: tenders
Date: July 28, 2009 04:23PM
If you have time on your hands you might be able to compile some data on how much the diminution of value actually is (comparing cars of your make/model selling with damage vs. without damage) and take it up in small claims court.

But I think you, as the owner of an asset that is expected to depreciate with use, just have to accept that as an inherent risk. Because you are the owner, the amount of diminution depends on when YOU decide to sell the car. If you drive it 300,000 more miles and compare its value to that of similar cars, so many other factors will determine its worth that the effect of the repair on the value could be zero. It isn't the fault of the guy who hit you that you might have been planning to sell your car tomorrow, nor is he any less culpable for his negligence if you were planning to sell your car in 10 years.

A collectible car or piece of artwork would be a different matter.

Edit: here's another point of reference: if you lease a car, and you crunch it and repair it well, do they take that less-tangible characteristic into account at the end of the lease? (I have never leased a car, so I don't know.)



Edited 1 time(s). Last edit at 07/28/2009 04:29PM by tenders.
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Re: No Diminution of Value in NJ??
Posted by: ItsMeAlison
Date: July 28, 2009 04:23PM
This is true, but I will never get full value for my car if I sell/trade it in. It will now be considered in "fair condition" no matter how good the car looks after the body work is completed. The difference is being in the "good condition" category will get me approx. $1000 more.
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Re: No Diminution of Value in NJ??
Posted by: ItsMeAlison
Date: July 28, 2009 04:26PM
Thank you. It is not a leased car, so I don't have to worry about any of that. However, I will look into taking it to small claims court.
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Re: No Diminution of Value in NJ??
Posted by: tenders
Date: July 28, 2009 04:45PM
> It will now be considered in "fair condition" no matter how good the car looks after the body work is completed.

I'm not certain this is true, but this isn't the only way to look at it. Say, theoretically, that tomorrow a piano falls on the car while you are parked on the street, necessitating the exact same repair. Are the piano movers more (or less) liable for this one because someone else from a completely independent case of negligence previously avoided (or came through on) paying you for the original diminution? An insurer might reasonably feel that you're entitled to the same compensation for the second accident as for the first.

Also, a car owner can sell a car in a number of ways, including not at all, beyond selling it to someone who insists that the repair automatically makes it in "fair condition." That is your option as the owner of the assets.

I'm not arguing that you're morally off base on this...I just don't think you're going to get any satisfaction on it.
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Re: No Diminution of Value in NJ??
Posted by: AlphaDog
Date: July 28, 2009 06:22PM
There are some who will refute the statement that a vehicle will be considered only in "fair condition" after work is completed, including KBB and NADA. I found this quote in a rather detailed printed debate on the issue of diminished value.

"Also, widely used market valuation guides, such as the Kelley Blue Book and the National Automobile Dealers Association (NADA) book, don't have separate valuation tables for vehicles repaired following an accident."

Here's a link to the entire article:

[www.acrsnetwork.com]

I notice State Farm is specifically mentioned in this article, but I didn't take time to research to see if that company had any role in developing it. It appears to repeat what I said in my first post, which is that there are a lot of variables involved, and the simple fact a car was damaged and then repaired doesn't mean it lost value.

I also have an example. Several years ago, my son was driving down a narrow two lane street with curb parking on both sides. A person pulled out from a parking place just as he was driving by, and there was damage to each portion of the right side of his car, front to back. The damage was really pretty minor, but fixing it meant the front fender, both doors, and the rear quarter panel all had to be repaired and repainted. The car was about 10 years old at the time, and, through the years, it had accumulated a number of little dents and dings from daily living. It looked absolutely beautiful after the repairs were completed. When it was put up for sale a couple of years later, it commanded a premium price for a car that old. Yes, the buyer did know the car had been damaged and asked for the details, but they had no concerns about buying it because the damage was simply cosmetic and the repairs were very well done (by the shop chosen by the other person's insurance company, as a matter of fact.) So, from personal experience, I would say that a contention that a vehicle "always" loses value after having been involved in an accident is a bunch of hogwash.
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Re: No Diminution of Value in NJ??
Posted by: rgG
Date: July 28, 2009 07:55PM
My mother-in-law was involved in an accident. Her insurance company wound up paying for her car to be repaired and also wrote her a nice check for diminution of value, without her even bringing the subject up. Here is a link to an article about how this is now handled in Georgia.

[www.atlanta-injury-attorney-blog.com]





Roswell, GA (Atlanta suburb)
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Re: No Diminution of Value in NJ??
Posted by: space-time
Date: July 28, 2009 09:04PM
Quote
ItsMeAlison
Imagine two vehicles parked side by side - both are the same year, make and model, both with the same options, both with the same mileage, they're even the same color. The only difference is that one recently had $8,000 worth of collision repairs. If the price were the same, the only difference being the accident history, which one would you buy ? (Exactly!!! - that's the concept of diminished value)

The difference in the amount you'd be willing to pay between the two vehicles - the amount the price of the previously damaged vehicle would have to be reduced - is the diminished value.

I would probably pay MORE for the car that was in the accident, it has 8000k worth of NEW parts and labor in it. Suppose the fenders and the hood was rusty on BOTH cars before the accident, now the car involved in the crash has new fenders and new hood and is freshly painted, which the other car isn't. If the repair was done correctly, IMHO the valued of the car should be the same or maybe even a little higher compared to the non-crashed car.
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Re: No Diminution of Value in NJ??
Posted by: AlphaDog
Date: July 28, 2009 10:02PM
Quote
space-time
I would probably pay MORE for the car that was in the accident, it has 8000k worth of NEW parts and labor in it. Suppose the fenders and the hood was rusty on BOTH cars before the accident, now the car involved in the crash has new fenders and new hood and is freshly painted, which the other car isn't. If the repair was done correctly, IMHO the valued of the car should be the same or maybe even a little higher compared to the non-crashed car.

That's how the person who bought my son's car viewed it, although that wouldn't always be true, depending on what kind of damage the car had sustained.
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Re: No Diminution of Value in NJ??
Posted by: RAMd®d
Date: July 29, 2009 01:03PM
I would probably pay MORE for the car that was in the accident

I think that's the view of a very small minority. Most are never really confident that the vehicle is "good as new" or better than it was.

IF (and note the big "if" ) buyers were absolutely certain that the car was in fact "as good as new or better" most of us *might* pay more for a previously crashed car.

Until then, MOST people will certainly not pay more for a repaired vehicle, let alone a heavily repaired vehicle.


So, from personal experience, I would say that a contention that a vehicle "always" loses value after having been involved in an accident is a bunch of hogwash.

Agreed. There are very few absolutes in the world.

But I will say the contention is [true] far more often than not.




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Edited 1 time(s). Last edit at 07/29/2009 01:04PM by RAMd®d.
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