Pay the Piper: Reporter Bankrupted After Being Ordered To Pay Damage To Porsche 917

200px-Porsche_917CJournalist Mark Hales is facing bankruptcy after he blew the engine of a £1.3million replica Porsche 917 during a test drive. Hales says that the owner, veteran Formula One ace David Piper, told him that he would cover any damage. However, Piper denied the oral agreement occurred and a court ordered Hale to pay $76,000 to cover repairs to the car, plus $100,000 in legal costs.


Hales, 62, writes for Octane and Auto Italia magazine and reportedly over-revved the engine causing it to explode. He has said that he has sold everything that he owns to pay his lawyers and now will have to declare bankruptcy. The imposition of the legal fees for Piper reaffirms my long opposition to the “English Rule” where the loser pays for the other party’s lawyers. It is a ruinous rule that deters people from suing corporations and wealth defendants. It also makes it less likely to be able to secure contingency counsel in such cases.

In this case, the dispute turned on a brief conversation that occurred on the track at Cadwell Park, Lincolnshire in April 2009. Piper was driving a Ferrari owned by Pink Floyd drummer Nick Mason and Hales borrowed his Porsche. Hales says that the Porsche 917 is known to have a problem with blown engines and he says it was Piper who raised the concern of the engine blowing. Hales says that he told him that he could not be responsible and that Piper agreed by saying “okay.” That was not enough for the court.

Hales was found to have driven “below the standard of care required of him”.

I take three lessons from this case. First, as noted by Samuel Goldwyn “oral contracts are not worth the paper they are written on.” Second, the English Rule is a continuing hazard to ordinary citizens in using the court system. Third, do not play with the toys of millionaires without something in writing.

Source: The Sun

43 thoughts on “Pay the Piper: Reporter Bankrupted After Being Ordered To Pay Damage To Porsche 917

  1. “The imposition of the legal fees for Piper reaffirms my long opposition to the “English Rule” where the loser pays for the other party’s lawyers. It is a ruinous rule that deters people from suing corporations and wealth defendants. It also makes it less likely to be able to secure contingency counsel in such cases.”

    ***************************

    The ones leading the fight against the English Rule are not plaintiffs but well-heeled defendants. Large corporations have enough economic clout to intimidate most plaintiffs as they do already. Imposing the English Rule would banish silly and outright obstructionist defenses as the defendants would have to pay for that roadblock in the system. As for Plaintiffs and as we see here, most could not afford to pay the exorbitant legal fees charged to corporations and simply don’t. Bring on the English Rule.

  2. “It is a ruinous rule that deters people from suing corporations and wealth defendants.”

    You’re saying the US system of allowing frivolous lawsuits is better? It’s better to allow people to make endless filings and drive the defendants into bankruptcy from lawyer fees?

    Yeah, right.

  3. Mespo,

    What do you think of the handicraft decision out of the 9th circuit…. I think it’s whittlestone vs handicraft…..it’s a 2010 decision….

  4. The myth of frivolous law suits brought by greedy human plaintiffs is just that, a myth. Now if you want to talk about the frivolous law suits brought by corporations to, for example, extend ther patent rights and increase cost for consumers, that is a discussion based in reality.

    The English Rule as it applies to individual plaintiffs is ruiness and has given the wealthy and corporations in England a pass on bad behavior. Our corporations just rewrite the law to make fraud, for example, legal.

  5. It really is a rule of law, spirit of law conundrum.

    On the one hand nobody should be deterred from filing a legitimate suit on grounds that if he loses, he will be in more debt than if he had not filed at all.

    On the other hand, nobody should be filing a lawsuit that is frivolous or intended to harass, as opposed to honest application for redress.

    I would say, that an automatic penalty for losing a lawsuit should not be normal procedure.
    But I also think the question of bad faith litigation is a legitimate one that requires an avenue of inquiry and redress.

    There are causes of action permitted in America that provide for just that.
    The element should be, did the losing plaintiff have a legitimate legal justification to file suit.

    If he did, then there should be no coverage of the winner’s legal fees, if not then he should pay.
    Of course that then begs the question, who pays for the derivative lawsuit to redress improper lawsuit, in a recursive fashion even.

  6. ooooooooooooooooooooooooooooooooooooooooooooohhhhhhhhhhhhhhh…….I had an epiphany…..in the second tier of the tower it is MONEY as a weapon…..all this time I’ve been thinking in terms of sex….sheesh….dontcha hate it when assh*les have their way…what is the legal term for ‘rape’ when it is using money to hurt people, instead of, well, you know…

    also, what a dick….

  7. I was just lied into buying a car from a dealership. (The salesman indicated the hatchback was good, held it up toldme how good it was, gave me no cause to question it, After I bought it found it did not open on its own or stay open.)
    Everything that the deal says I then write in an email and send to him, this is what was said today. I am making sure he offer he makes becomes specific rather then the general that he has written in an email.
    Verbal is worth nothing.
    I have been in court where the denial of what was said is astounding. (In one small court case the defendant said he had never promised to pay a third party. I had the cancelled checks and he continued to say he never siad he would pay her, or had paid her.
    To say loser pays is unfair to many plaintiffs. Sadly often it is the better lawyering rather then the outright proof that causes a case to be won or lost.
    Should you not sue for malpractice despite outright proof due to fear you will lose?
    Sadly the lesson for this reporter and too many of us is trust noone and take no one at their word.

  8. “There are causes of action permitted in America that provide for just that.
    The element should be, did the losing plaintiff have a legitimate legal justification to file suit.”

    Gary T,

    I find your argument persuasive, but how is a “legitimate legal justification” decided. The problem to me seems to devolve upon the underfunded, clogged court system that literally take years to reach a point where a Judge determines whether or not a particular lawsuit is frivolous. The system seems to run on interminable delays and when one is being billed by the hour the costs of legal representation multiply exponentially. Adjudication of an issue should take place within months, rather than years. The overcrowding of the court system makes unreasonable requests for delays seem appealing to the courts with their overcrowded dockets

  9. Does the factor called contributary negligence come into this? Why did the owner allow a rank amateur drive his 1.3 million pound car, in the first place. I won’t let my friends drive my 350Z………

  10. Mike, I think another aspect is some of this should not be in the court system. Medical malpractice, for instance.
    It should be heard by a panel of mediators, medical and non, so the decision is based on more then emotion and prejudice for and against doctors.
    (In my case after the doctor perjured himself, said A, “major and common” in 2 depositions, both read into the record, and B “unknown” when on the stand, I talked with a juror. “Who did you believe?” She replied “The doctor” I wanted to ask her which time but realized it would be a waste of breath.)

  11. Gary:

    “The element should be, did the losing plaintiff have a legitimate legal justification to file suit.”

    ****************************

    Generally speaking that is already the law in the federal system and most states. It’s called a Rule 11 motion in the federal system. By the way you forgot to mention the defendant might lose and still have to pay fees.

  12. leejcarroll:

    “I was just lied into buying a car from a dealership. (The salesman indicated the hatchback was good, held it up toldme how good it was, gave me no cause to question it, After I bought it found it did not open on its own or stay open.)”

    ************

    Check you state’s “Lemon Law” to see if you have any recourse. You may also have a consumer fraud case that your states’s attorney general office can process if you were deceived. Oral contracts may not be worth the paper they are printed on (and judges routinely rule that way) but actual fraud is a question for the jury and no dealership wants to run that risk for a hundred dollar or so problem.

  13. Mespo,

    The lemon laws only apply to new vehicles…. She does possibly have an action under magnum moss, fraud, breach of contract, consumer protection act, unless its been gutted by the state….then the fall back is the federal ….. Or both….

  14. “Mike, I think another aspect is some of this should not be in the court system. Medical malpractice, for instance.
    It should be heard by a panel of mediators, medical and non, so the decision is based on more then emotion and prejudice for and against doctors.”

    LeeJ,

    This seems reasonable, but the problem then becomes who makes up the mediation board? Part of the problem with Med malpractice suits is the unwillingness of Doctors to testify against other Doctors. Wouldn’t this same unwillingness be true of those o the mediation panel?

    As for your car purchase I grew up in the car business. My father was a dealer, a salesman and a car appraiser. He taught me much about buying cars. I’ve been driving for more than 50 years and have owned perhaps 45 cars, it’s so many I forget at times. Most of that total came from buying used cars exclusively until I was in my 40’s. With that knowledge you would think that my car buying decisions would be pragmatic, distrustful of sales pitches and after good research. The truth is most of them were based on emotion and liking a car’s looks. I bought a 1973 AMC Gremlin new based on looks alone. I even thought for some unbeknownst reason that the car had four wheel drive. I never even asked that question to the salesman. I only found out on the way home from the dealership that the car didn’t have four-wheel drive.
    All car salesman are liars because that is the nature of the business. The problem is that too often our own emotions get in the way of what should be our innate pragmatism.

  15. MIke,
    if you thought that the Gremlin was a good looking car, you were in a very small fraternity! At least you didn’t buy the Pacer. :)

  16. AY:

    Virginia’s Lemon Law covers used vehicles still under original mftr warranty. We also have a Unfair and Deceptive Acts and Practices (UDAP) laws that applies to used cars.

  17. There was a situation over here where a person bought an expensive Ferrari sports car (of course using a loan of 100K+ down payment) and took it out to a racetrack to open it up.

    He lost control of the car around a curve and crashed. He wasn’t injured fortunately but the car caught fire and was totalled.

    He then filed a claim with the insurance company and the company denied his claim under a clause that the loss happened on a race track.

    The bank found out about the loss of their collateral and called his loan. He ended up having to take out a second mortgage on his house to cover the loss and pay the bank back.

    Best to stay away from these types of cars in my book.

  18. Mespo Thanks. I complained to Toyota, it is a toyota dealership and they told me go to the DA, they have nothing to do with it once they sell a dealership.
    Mike, I relied sadly on the truthfulness of the salesman, thinking since it was not Joe schmoo from the internet that they had to be honest about the condition of the car they were selling. I have only bought used cars and this is the first time someone has outright lied.
    I made them fix it but the fix is such that the car is still a problem for me to use (because the hatchback is too heavy for me to open – I have a very bad neck situation). They have offered to find me another car (but why would I trust any other car from them and they have none in which I have interest) or to remove the spoiler and see if that helps., so we are in the midst of negotiating this. The interesting thing is that in all of this, when I have used the word ‘defrauded” they have not once denied I was lied into buying the car.
    (Rafflaw my mother had a pacer. I really liked that car as did she. I never understood why it was considered such a bad car. But maybe it was just luck that hers was good, and safe)
    Reagrdless of the outsome I will go to the DA so they have notice incase other folks also have the same complaint about this dealership.
    Thanks for all your replies and suggestions.

  19. Mike as to med mal. I wonder if it was not in the court if doctors would be more willing to come forward, not feeling it was as much of a crapshoot. The funny thing is I read a statistic a number of years back that regardless of proof 85% of docs win the med mal cases so doctors have very little too worry about.
    If they would come forward and clean out their ranks there would be no so called “med mal crisis in the first place.
    A new show is coming on that based on the ads is about M&M conferences. If they would come forward when they learn on those that a doctor has committed outright malpractice and offered to fix what they could there would also be less suits. (Studies have been done that have shown and apology and effort to undo the damage puts thre brakes on many a malpractice case.
    I went before a judge who was completely biased towards the doctor. Hopefully say 3 docs, 3 laypeople and you help to even out the biases for and against.

  20. I take three lessons from this case. First, as noted by Samuel Goldwyn “oral contracts are not worth the paper they are written on.” Second, the English Rule is a continuing hazard to ordinary citizens in using the court system. Third, do not play with the toys of millionaires without something in writing.

    There it is.

  21. Mespo,

    You are correct about the deceptive trade practice act…. I forgot that one…. I will also defer to your expertise in Virginia… Regarding the lemon law… I should have said, generally, it does not apply to used vehicles….. Thank you for the clarification ….. You’re a mentor indeed…

  22. if over revving the engine is that easy and commonly results in a blown engine, why wasn’t a rev limiter installed?

  23. pete,

    Because it wouldn’t have been a replica 917 if he had. Nick Mason is a true gear head car guy. He’d never blaspheme like that. Part of the attraction is the warts and all. ;)

  24. The guy should just claim bankruptcy under our current bankruptcy laws which leave creditors almost without recourse. As an aside, not only do my hubby and I own 2 condos outright with no mortgage, plus a couple pieces of rural land and a city lot with no mortgage, I also drive an old 1988 Toyota Camry with 196K miles on it. I bought it 4 years ago for $850 and have only had to put routine maintenance into it. I drive cautiously, like a little old lady. As I read this article, I feel like my hubby and I are laughing all the way to the bank.

  25. Gene

    with all the rods and restos i’ve built or had a hand in building i’ve never understood why people will keep some things factory and alter others.

    like explaining to an 80y/o man why you can’t have modern electronics with a 37 la salle six volt pos. ground. square peg meet round hole.

  26. pete,

    As a fellow car guy, I’m with you. I’d much rather have an old car that I like the style of with modern electronics and wiring and usually suspension. In some cases, I’m not even picky about the power plant being original. For example, if I owned a ’63 Jaguar XKE, it would be basically all new except the body. Those guys who insist on matching VINs and all original equipment are a puzzle to me. Then again, I collect books, not cars. If you have a sizeable collection like Nick Mason does, I can kind of see the rationale behind it, but I’m not the kind of car guy who would buy something so I could look at it. I want to drive it.

  27. That reminds me of the old joke about Jaguars. Their sales slogan should be “Buy Two!” so you’ll have one to drive when the other is in the shop. They’ve improved their quality a lot since Ford owned them, but they did have a lot of room to improve too. ;)

  28. 1. Oh golly gosh. An auto journalist that is actually going to have to pay for the damage they do to other’s cars. Heck that is novel.
    You cannot begin imagine all the thrashed test cars that so called journos heavily abuse every month which are then dolled up and put on the used car market as near new cars or demos or factory excecutive driven cars and some poor unsuspecting person ends up buying it. I hope he suffers.
    (If I had a 917 I would not allow an auto journalist to touch it.)

    2. ” The imposition of the legal fees for Piper reaffirms my long opposition to the “English Rule” where the loser pays for the other party’s lawyers. It is a ruinous rule that deters people from suing corporations and wealth defendants. It also makes it less likely to be able to secure contingency counsel in such cases.”

    Oh – you must be a lawyer then……..

    Sorry but I agree with P SMITH’s post on this one.

  29. Gene

    heard the same joke about owning two with the old amf harleys.

    lucas 3 position light switch. off-flicker-dim

  30. “Their sales slogan should be “Buy Two!” so you’ll have one to drive when the other is in the shop.”

    Gene,

    The joke was true. The way I heard it was when the introduced the “E” Type, with a V-12 engine and dual carbs, it was almost impossible to keep the engine in tune, causing almost monthly visits to a mechanic. Back then I had the skills to tune a V8, but somewhere in the 80’s the engineering when way beyond me.

    I love driving and cars, obviously, growing up in the business. My father, my Maternal Grandfather and Uncles were demon drivers. My big Brother inherited the family tradition and upped it by being a street drag racer in the 50’s (think “Rebel Without a Cause”) and when I got my license in 1961 my first night out was spent drag racing my ’57 DeSoto. I did that for about four years, but a few really hair-raising experiences taught me fear. Also too, because I didn’t buy my first new car until the Gremlin, driving used cars over 85 mph didn’t seem a good idea after a while. At this point my driving feats are limited to driving long distances and maintaining a speed 9 mph above any speed limit. Defensive driving is smart driving and I practice it.

    Down here near Ft. Lauderdale, Boca Raton and Palm Beach one commonly sees many exotic cars like Rolls, Bentley’s, Porsches, Maserati’s, Corvette’s, Lamborghini’s and such. With the exception of the English duo, the others are ill-suited to driving on the street since they are so over-powered. On the highways they’re usually driven slower than normal because the police watch them closely. I personally don’t think the owners buy them for they’re driving capabilities, but for the cachet they lend. I had an epiphany one night driving my 1954 Caddy Eldorado around my neighborhood with the top down and the music blasting. I realized that since I couldn’t see myself actually driving the car, my experience was solely limited to the inside and essentially who cared what it looked like. My favorite out of the many I owned was a powder blue, 1954 Oldsmobile Starfire Convertible. It was exceptionally fast off the line and for the 4 months I had it, it was love. Unfortunately, one night as I was leaving school the engine caught fire and the car burned up, though I had made a hasty escape.

    http://www.mecum.com/auctions/lot_detail.cfm?LOT_ID=HA0412-124546

  31. Gene,

    Gorgeous!! I once tried to talk my father into buying me a super-charged (blown) 1948 Caddy Convertible, with a Hurst shifter. He refused telliing me I’d probably kill myself and no doubt that was wisdom.

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