2010 2011 BMW 5 Series Forum F10 - View Single Post

raleedy · 01-05-2014, 08:56 AM

I am very sympathetic to the OP's situation, but I would advise that he be very careful with this claim. The first thing to keep in mind is that a claim of diminished value is a claim for economic loss, not one for emotional distress. You may be sad and disappointed that your nearly brand new car will have been damaged and repaired, and you may even be concerned that the repair will leave it vulnerable to mechanical or electrical problems that it would not otherwise have had. Those are not economic injuries. They are a state of mind, however unattractive it may be to you. They are not compensable as such. Your car will be repaired to BMW's standards and if you drive it for the rest of the lease term, BMW will take it back and everything else -- with the exception of your state of mind -- will be as it was and would have been without the crash, including the manufacturer's warranty and whatever warranty comes with the repairs.

If that's not good enough for you, and you want out of the lease, you can probablyt sell the car and pay the lease balance due to BMWFS. You won't get as much for the car as you owe on the lease, so you will now have an economic loss. But now imagine what the car was worth in the instant before the crash. It had been sold, titled and licensed, and (lightly) used. Its warranty and maintenance clocks had started to run. It wasn't new any more, and wasn't any longer worth what it cost new. That depreciation or loss of value is yours to bear (unless you can rely on gap coverage), and not the responsibility of the person who caused the crash, or his insurer. And it's a big chunk of change including not only actual depreciation but the spread between retail and wholesale value at that moment, and any transaction costs, and even what you may have paid in up-front leasing costs as origination fees and capital cost reduction. If you try to recover diminished value through this route, you'll also have legal expense and court costs to bear on your own, as these are not recoverable as a rule. It's not a path I would choose.

01-05-2014, 08:56 AM	#72
raleedy Colonel 160 Rep 2,248 Posts Drives: 2016 228i 6-speed Join Date: Jul 2005 Location: Portland, Oregon iTrader: (0)	I am very sympathetic to the OP's situation, but I would advise that he be very careful with this claim. The first thing to keep in mind is that a claim of diminished value is a claim for economic loss, not one for emotional distress. You may be sad and disappointed that your nearly brand new car will have been damaged and repaired, and you may even be concerned that the repair will leave it vulnerable to mechanical or electrical problems that it would not otherwise have had. Those are not economic injuries. They are a state of mind, however unattractive it may be to you. They are not compensable as such. Your car will be repaired to BMW's standards and if you drive it for the rest of the lease term, BMW will take it back and everything else -- with the exception of your state of mind -- will be as it was and would have been without the crash, including the manufacturer's warranty and whatever warranty comes with the repairs. If that's not good enough for you, and you want out of the lease, you can probablyt sell the car and pay the lease balance due to BMWFS. You won't get as much for the car as you owe on the lease, so you will now have an economic loss. But now imagine what the car was worth in the instant before the crash. It had been sold, titled and licensed, and (lightly) used. Its warranty and maintenance clocks had started to run. It wasn't new any more, and wasn't any longer worth what it cost new. That depreciation or loss of value is yours to bear (unless you can rely on gap coverage), and not the responsibility of the person who caused the crash, or his insurer. And it's a big chunk of change including not only actual depreciation but the spread between retail and wholesale value at that moment, and any transaction costs, and even what you may have paid in up-front leasing costs as origination fees and capital cost reduction. If you try to recover diminished value through this route, you'll also have legal expense and court costs to bear on your own, as these are not recoverable as a rule. It's not a path I would choose.
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