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Loss of Income versus Loss of Use – are they different or the same?

Filed in: Motor Accidents, Motor Workshops

In motor accident claims, you need to understand these 2 losses properly so as to calculate the amount of money rightfully due to claimants.

Introduction

A common question from claimants, especially those who are private-hire or food delivery workers, is whether they are able to claim for both loss of use of vehicle (“LOU”) and loss of income (“LOI”) arising from a motor accident. Lawyers who practise motor accident claims will usually place LOU as a loss arising from property damage; and LOI as a loss arising from personal injury. In mixed personal injury and property damage claims, are LOU and LOI discrete and separate from each other, or are they one and the same?
To understand the issue, let’s analyze a scenario:
1. Claimant profile: a private-hire driver who is also a car owner. He earns a gross daily income of $300 as a private-hire driver.
2. Losses¹ suffered from the accident:
  1. LOU of his car over 5 days, and
  2. LOI over 5 days’ of medical leave.

How much can the claimant claim for LOU and/or LOI? Is it:
1. LOU + LOI = 400 + 750 = $1,150 or
2. LOU or LOI, i.e. $400 or $750 (not both).

The law

Let us look at 2 cases on how the Singapore courts have touched on the relationship between LOU and LOI. In the first case, the High Court said⁵:

As pointed out in The Hebridean Coast, an award for loss of use may take the form of either (a) loss of profit⁶; or (b) the operating cost of the chattel under repair, thrown away by its being detained; or (c) interest on capital and depreciation during the period of detention.
In the second case, the Court of Appeal said⁷:

Turning now to the loss of use of the double-decker, we cannot see why a loss of use through destruction should be differentiated from a loss of use pending repair through damage. In both cases the owner has been deprived the use of the chattel, in the one case until the destroyed chattel has been replaced and in the other, until the damaged chattel has been repaired. The authorities do not seem to make this distinction. In the Owners of Dredger Liesbosch v Owners of Steamship Edison [1933] AC 449, the owners of the dredger were awarded damages for loss of profit (that being the proper measure of damages [for loss of use] in that case) for the period until the replacement dredger could be put in place.
For an authority closer to the practice of motor accident claims, let’s look at Appendix D of the State Courts Practice Directions, specifically the benchmark rates for LOU for taxis:
From the foregoing authorities, the correct principle is that LOU includes LOI, or that LOI is LOU. Going back to our scenario at point 2, the claimant is able to claim either $400 or $750 (not both). Provided he has enough income statements to prove LOI, he can claim the higher amount of $750.
Let’s modify the scenario slightly such that the periods of LOU and LOI do not overlap completely:
The modified scenario could happen if the claimant went to see a doctor twice, and was given 2 separate medical certificates (MCs), covering the periods 31 June – 2 July and from 4 July to 6 July. In total, his claim will be calculated as:
1. 31 June – 2 July (covered by MC): 3 days’ of nett LOI = 3 days x (50% of $300) = $450;
2. 3 July (not covered by MC, but deprived of vehicle usage): 1 day of LOU = 1 day x $80 = $80;
3. 4 July – 6 July (covered by MC): 3 days’ of nett LOI = 3 days x (50% of $300) = $450.
  Total: $980

Conclusion

In this article, we hope we have given you a better understanding of what LOU and LOI are. We end off by answering the question posed at point 1 above: are LOU and LOI discrete and separate from each other, or are they one and the same?
In the scenario at point 2, the period for each loss overlaps completely. LOU and LOI are treated as one and the same, and the claimant can claim either one (not both). If the period for each loss is separate from the other, each loss can be claimed separately and then added up (as the modified scenario at points 8 – 9 show).

¹ Other losses like cost of repairs and pain and suffering are not discussed in this article. But such losses do exist in a typical motor accident claim involving property damage and personal injury.
² Which would usually correspond to the period of repairs, i.e. when the vehicle was retained in the workshop for repairs.
³ Appendix D of the State Courts Practice Directions 2021, for private cars that are less than 1,600 cc and 97 kW.
⁴ Note the distinction between gross and nett income. In motor accident claims, nett income is the proper measure of loss, nett income is usually derived by applying 50% of gross income. See, [43] of Mohamed Akbar Bin Ibrahim v Tan Geok Yee [2024] SGMC 58.
⁵ Singapore Bus Service (1978) Ltd v Mohd Kamal bin Abas and another [1996] 2 SLR(R) 122 at [22].
⁶ It is submitted that “loss of profits”, as used by the courts, is a synonym for LOI.
⁷ Singapore Bus Service (1978) Ltd v Gwee Sok Ai (trading as Chuan Bok Wong Trading) [1996] 3 SLR(R) 307 at [22].

Uploaded on 06 Aug 2025