Can I sue the other driver for the total loan amount ?

UPDATED: Oct 1, 2022

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Can I sue the other driver for the total loan amount ?

I was hit head-on by a driver who fell
asleep at the wheel. The vehicle was a
total loss. The loan amount is more
than the vehicle’s worth. Can I sue the
other driver for the remaining balance?

Asked on November 2, 2017 under Accident Law, Michigan


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, you cannot. When property is destroyed (for example, a vehicle totalled), all you are entitled to is the value of the property, not the price you paid, the remaining amount due under any loan or financing, or the cost to replace. Price is all over the place, and has nothing to do with value: some people get cars as gifts or for very low prices from family, for example; people vary in how good they are at negotiating; financing always increases the price over a cash transaction; etc. Therefore, if price, etc. were a factor, two people who had the same make, model, year, mileage, etc. car's totalled might get wildly different compenation, which is neither fair nor a predictible, practical way for the law to work. Not only is price highly variable, but 1) it has nothing to do with the at-fault driver; and 2) it is easily manipulated or faked in many cases, such as with false bills of sale or invoices. For all these reasons, the law uses the car's value, which is much more consistent and readily verified, as the benchmark, and so you are not entitled to more than its actual, then-current fair market value.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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