The adverse party may contend that you did not take the proper action to mitigate your losses and therefore deny your claim for downtime. You must then prove with supported facts that you took every reasonable step to lessen your losses. Although you are the victim of the incident, it is your job as plaintiff to prove your case fully.
Q: What is mitigation of damages?
A: Mitigation of damages is the use of reasonable care and diligence in an effort to minimize or avoid injury. This means that you should try to lessen your losses after an accident.
Q: Do I have to mitigate my damages? I was the victim! I was legally parked, asleep in the sleeper when my truck was hit.
A: Yes, even if you were completely innocent in the accident, it is your duty to mitigate your damages.
Q: How do I mitigate my damages?
A: State laws vary, but generally you must do whatever you can reasonably do to lessen your losses, like rent or borrow other equipment, drive for someone else, or file a claim with your own insurance carrier to get the damage repaired quicker.
Q: What if I have specialized equipment and can’t rent a truck?
A: Depending on your particular equipment, how necessary it is to the business of the truck, and how difficult it is to rent this specialized equipment, this may be a valid defense toward the other party’s demand that you mitigate your damages.
Q: What if the company I’m leased to will not allow a temporary rental?
A: Depending on your lease agreement and state law, this also may be a valid defense toward the other party’s demand that you mitigate your damages.
Q: What if I can’t afford the deposit to get a rental or it doesn’t make business sense to get a rental? Many deposits are around $5,000.
A: This is a fact specific question and should be discussed carefully with your lawyer and accountant.
Q: What if the adverse insurance company is stalling and is not fixing my truck?
A: You still have the obligation to mitigate your damages. This may include filing a claim with your own insurance carrier to get the truck fixed or paying for the repairs yourself.
Q: My equipment was totaled. It took two months to find new equipment and get back on the road. Do I have to mitigate my damages during these two months?
A: Generally, you must always attempt to mitigate your damages. The facts of each case will vary, and it’s important to look at what is reasonable in each situation. You should document everything you did to mitigate your damages during this downtime period. In some states, it’s more difficult to get downtime on totaled equipment.
Q: What paperwork do I need to help prove I mitigated my damages?
A: You should keep a diary of everything you do on a daily basis towards mitigating your damages, including calls to the other party’s insurance carrier to spur them along, calls to truck rental companies, internet searches for new equipment, etc. Insurance companies function on paperwork, so keep copies of each application for a rental truck, each rejection of rentals, letters from your motor carrier stating they don’t allow temporary rentals, proof of specialized equipment required for your business, etc.
Q: The other party says the claim wasn’t their fault and won’t accept liability. Do I still need to worry about mitigating my damages?
A: Yes. Hopefully, you will either persuade them that the accident was their fault or a judge will determine this to be the case. Once the other side is deemed at fault for the accident, you have to prove your damages (your losses). If you didn’t try to limit or lessen your losses, they may have a valid defense for substantially reducing your claim amount.
Q: My damaged equipment was towed to the local body shop near my home. The other side said I should have had it fixed near the accident site and won’t pay the tow bill. Are they responsible for it?
A: Typically, the answer depends on the facts of the case and what a reasonable person in your shoes would have done. If your equipment was to be down for an extended period of time and you would have to spend a lot of money for hotel rooms nearby, then towing the equipment home so you would not incur hotel charges might show that the expense was reasonable and you attempted to mitigate your damages.
Q: I was down longer than expected because I didn’t want to use the adverse insurance company’s repair shop. Now they’re saying they won’t pay for those days down while we were negotiating. Do I have to use their repair shop? Do they have to pay my downtime during that negotiation period?
A: Generally, you as the owner have the right to select the repair facility. Whether the adverse will be responsible for the entire bill is a question of the facts of the case. You would need to show that your facility charged a reasonable price and it was the best location for the repair. You will also need to show you were attempting to mitigate your damages while in the negotiation period.
Note: The answers above are general in nature and do not relate to any specific state laws. General common law is recited. As an attorney, I am only licensed in Florida and Illinois.