At-Fault Driver Won’t Pay for Your Car Damage? What to Do in NSW

A motor vehicle accident can be frustrating enough. It becomes even more stressful when the other driver appears to be at fault but refuses to pay for the damage, ignores correspondence, disputes responsibility, or has no insurer.

In New South Wales, a claim for vehicle damage is generally a civil claim. Recovering the loss successfully usually depends on two things: being able to establish who was legally responsible for the accident, and being able to prove the amount of the loss claimed.

Here are the practical steps to consider if payment is not forthcoming.

1. Preserve the Evidence Before Anything Disappears

Evidence collected shortly after an accident can make a major difference if liability is later disputed.

Keep copies of any material that may help establish how the collision occurred and what loss followed, including photographs and video of the vehicles, damage and accident location; dashcam footage; the other driver’s name, address, registration and insurance details; witness names and contact details; police event details; repair assessments, quotations and invoices; towing or storage invoices; and relevant messages, emails or admissions made after the accident.

Do not assume the other driver will continue to accept responsibility simply because they did so at the roadside.

2. Work Out Exactly What You Are Claiming

A demand should identify the loss clearly and be supported by documents.

For a vehicle property-damage claim, the central loss will often be the reasonable cost of repairs. If the vehicle is uneconomical to repair, the dispute may instead concern its pre-accident value and any salvage value.

Depending on the circumstances, other losses may also be claimed, such as reasonably incurred towing, storage or loss-of-use expenses. These items are not automatically recoverable simply because money was spent: liability, reasonableness, causation and supporting evidence can all become issues.

Keeping invoices, quotations and a clear chronology makes it much easier to explain the claim if it later proceeds to court.

3. Send a Clear Letter of Demand

Before commencing proceedings, it is usually sensible to give the other party a proper opportunity to resolve the claim.

A useful letter of demand should generally identify the date and location of the accident; the vehicles involved; why you say the recipient is responsible; the amount claimed; the documents supporting that amount; a reasonable deadline for payment or a substantive response; and what may happen if the matter is not resolved.

The tone should stay factual. An aggressive letter does not strengthen the evidence.

A well-prepared demand can also expose the real issue early — for example, whether the driver disputes liability, disputes the amount, says an insurer is handling the claim, or simply cannot pay immediately.

4. If the Driver Is Insured, the Insurer May Become the Practical Point of Contact

An at-fault driver may refer the demand to their insurer. That does not necessarily mean the insurer will immediately accept the claim.

Insurers may ask for evidence about liability, photographs, repair invoices, quotations, vehicle valuation information or other documents. A dispute can arise over either fault or the amount claimed.

Keeping correspondence organised and responding directly to the issues raised can prevent unnecessary delay.

5. If Negotiations Fail, a Local Court Claim May Be Available

The Local Court of NSW expressly deals with civil disputes involving money or property, including damages arising from motor vehicle accidents.

As at September 2026: the Small Claims Division deals with claims up to $20,000; and the General Division deals with civil money claims over $20,000 and up to $100,000.

Small Claims proceedings are generally less formal than General Division proceedings. The Court states that civil claims are determined on the balance of probabilities — in other words, whether the relevant facts are more likely than not to have occurred.

Court proceedings should not be started automatically simply because a demand has been ignored. Before filing, it is sensible to consider the strength of the liability evidence, the value of the claim, likely legal and filing costs, and whether any eventual judgment is realistically recoverable.

6. Do Not Leave a Property-Damage Claim Indefinitely

Limitation periods apply.

Under section 14 of the Limitation Act 1969 (NSW), a cause of action founded on tort is generally subject to a six-year limitation period from the date the cause of action accrues.

That does not mean waiting six years is a good idea. Evidence becomes harder to locate, witnesses become more difficult to contact, vehicles may be repaired or sold, and documents can disappear.

Early action is usually much easier than reconstructing a collision years later.

7. What If the Other Driver Simply Has No Money?

Winning a claim and recovering the money are not always the same thing.

If a court enters judgment and the judgment debtor still does not pay, separate enforcement processes may be required. This is one reason the commercial side of a claim matters as much as the legal side.

Before significant costs are incurred, it can be useful to consider whether the defendant appears to be insured, whether there is a realistic enforcement pathway, and whether settlement or an instalment arrangement may produce a better practical outcome.

Need Help Recovering Motor Vehicle Property Damage in NSW?

Motor vehicle property-damage disputes can quickly become complicated when liability, repair costs, insurers or recovery steps are contested.

K+M Legal assists with motor vehicle property-damage and recovery disputes in NSW.

If you would like advice about your particular circumstances, contact K+M Legal.

This article provides general information only and is not legal advice. The law and court procedures can change, and the appropriate approach depends on the facts of each matter.