Carswell v Secretary of State for Transport
| Jurisdiction | England & Wales |
| Judge | Mr Justice Hickinbottom |
| Judgment Date | 09 December 2010 |
| Neutral Citation | [2010] EWHC 3230 (QB) |
| Docket Number | Case No: HQ09X03522 |
| Court | Queen's Bench Division |
| Date | 09 December 2010 |
[2010] EWHC 3230 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Before: Mr Justice Hickinbottom
Case No: HQ09X03522
Andrew Ritchie QC (instructed by Boyes Turner) for the Claimant
Jemima Stratford QC and David Barr (instructed by Treasury Solicitor) for the First Defendant
Stephen Worthington QC (instructed by Weightmans) for the Second Defendant
Hearing dates: 9–12 November 2010
Approved Judgment
Mr Justice Hickinbottom:
Introduction
Jim Carswell was knocked down by a car as he crossed the Euston Road on the evening of 26 October 2005. He had been out with friends, three of whom were with him at the time of the accident. There was evidence that they had all consumed some alcohol that evening, and that Mr Carswell had crossed the road when the traffic lights governing the crossing showed red against him.
Unfortunately, as a result of the accident, Mr Carswell suffered severe head injuries and, following a lengthy period of unconsciousness, he died on 17 April 2007. He left a widow, Mrs Arlene Carswell, the Claimant in this action.
The car that struck Mr Carswell did not stop, and the driver was never traced. Consequently, following advice from her solicitors (Boyes Turner), on 28 February 2006, Mrs Carswell made an application to the Second Defendant, the Motor Insurers' Bureau (“the MIB”), under the Agreement between the Secretary of State and the MIB dated 7 February 2003 providing for Compensation for Victims of Untraced Drivers (“the 2003 Agreement”), under which the MIB are bound to compensate the victims of hit-and-run drivers.
On 9 March 2008, Mrs Carswell accepted an offer from the MIB of £250,000 (made on the basis of a reduction of 40% for contributory negligence), together with costs due under the 2003 Agreement, i.e. 2% of the award as a contribution towards solicitors' profit costs (£5,750 inclusive of VAT) and disbursements (£5,022.65 again inclusive of VAT). That aggregate sum has been paid. Of course, no sum of money could possibly compensate Mrs Carswell for the loss of her husband; but she was pleased with that settlement, and pleased with the manner in which Ms Kim Smerdon (the partner at Boyes Turner who had handled her application) had conducted her claim.
However, the award left a shortfall on the costs and disbursements which Boyes Turner had billed Mrs Carswell, which she had agreed to pay and which indeed have been paid to the solicitors by Mrs Carswell out of the substantive sum paid to her by the MIB. The disbursements outstanding of £960.86 (in respect of reports by an accident investigator and an accident reconstruction expert) have not been pursued: but, on 28 October 2008, these proceedings were issued in which Mrs Carswell seeks the outstanding solicitors' fees (£14,977.31, being £13,023,75 plus VAT) as damages from the First Defendant Secretary of State on the basis that he has failed properly to implement various European Motor Insurance Directives (but particularly Article 1(4) of EEC Council Directive 84/5/EEC) with the result that she has not been paid a sufficient sum for the legal costs she incurred in her application to the MIB. Although it is said on Mrs Carswell's behalf that the manner in which the claim was handled by the MIB was inadequate, her claim is dependent upon a successful challenge to the integrity of the scheme adopted by the Secretary of State to implement the Directives.
I shall therefore deal with the claim that the Claimant has a right to damages from the Secretary of State because of his failure properly and lawfully to implement the Directives first, before going on to consider the Claimant's specific complaints as to how the MIB dealt with her particular application.
The European Directives and the Agreement
It has been obligatory for the drivers of motor vehicles to have insurance since the Road Traffic Act 1930, enacted in the light of the increase in traffic on the roads after the First World War and the rise in the number of occasions when members of the public were injured as a result of the negligence of motorists who were not insured, with the result that, for practical purposes, the injured party was deprived of appropriate compensation. This Act imposed, for the first time, a statutory obligation on the users of all motor vehicles to provide security against their legal liability for the death of or bodily injury caused to third parties.
However, that did not assist the victims of drivers who were, despite the obligation to insure, in fact uninsured; and, in 1937, a committee chaired by Sir Felix Cassel KC recommended that a central fund should be set up to provide compensation for third parties injured by uninsured drivers.
Pursuant to that recommendation, in 1946, the motor insurance industry set up the MIB as a company limited by guarantee. Its members are those insurers who transact motor insurance in the UK: and, by section 145 of the Road Traffic Act 1988, all who underwrite motor insurance are obliged to be members of the MIB and contribute to its funding.
The obligations of the MIB are not imposed by statute, as they could have been: they are rather the subject of agreement between the United Kingdom Government (through the relevant Minister of State) and the MIB. The first agreement was made on 17 June 1946 between the Minister for Transport and the MIB. It covered only compensation for the victims of identified uninsured drivers. Since then, there have been various different Uninsured Drivers' Agreements, the current agreement being that dated 13 August 1999. The essence of that agreement, like its predecessors, is that, if a claimant obtains a judgment in respect of a liability required to be covered by the compulsory insurance requirements of the Road Traffic Acts and it is not satisfied, then the MIB will meet that judgment.
However, those agreements do not cater for the situation in which the driver cannot be identified, because in that case there is no one against whom the claimant can obtain a judgment. To fill this lacuna, the MIB entered into a separate agreement with the Government in 1969, namely the Untraced Drivers' Agreement dated 21 April 1969, under which the MIB undertook to pay compensation to persons injured by motor vehicles where the identity of the driver was unknown. This agreement too has been reviewed and replaced from time-to-time. The present agreement, and the one which was current at the time of the Claimant's application, is the 2003 Agreement.
There were a number of factors which led to the renegotiation of the agreement in 2003. Victims of untraced drivers had increasing expectations for better levels of compensation, and there was pressure in support from groups such as the Association of Personal Injury Lawyers and the Motor Accident Solicitors' Society. There was concern that applicants under the Agreement could not obtain provisional or periodical payments. The introduction of the Human Rights Act 1998, particularly regarding the right to a fair trial under Article 6 of the European Convention on Human Rights, was a further factor which persuaded the Government to consider that a review of the Agreement would be apposite. However, the main driver was the increasing influence of European law in the area.
The first European intervention was in 1972. EEC Directive 72/166/EEC (“the First Directive”), amongst other things, required each member state to ensure that civil liability in respect of the use of motor vehicles was covered by insurance (Article 3(1)). Of particular importance in relation to this claim, EEC Directive 84/5/EEC (“the Second Directive”) required member states to set up a body to provide compensation for damage to property and the person caused by an unidentified vehicle (which includes, for these purposes, an unidentified driver). Article 1(4) of the Second Directive provides:
“Each Member State shall set up or authorise a body with the task of providing compensation, at least up to the limits of the insurance obligation[,] for damage to property or personal injuries caused by an unidentified vehicle or a vehicle for which the insurance obligation… has not been satisfied. This provision shall be without prejudice to the right of the Member States to regard compensation by that body as subsidiary or non-subsidiary and the right to make provision for the settlement of claims between that body and the person or persons responsible for the accident and other insurers or social security bodies required to compensate the victim in respect of the same accident.
The victim may in any case apply directly to the body which, on the basis of information provided at its request by the victim, shall be obliged to give him a reasoned reply regarding the payment of any compensation.
However, Member States may exclude the payment of compensation by that body in respect of persons who voluntarily entered the vehicle which caused the damage or injury when the body can prove that they knew it was uninsured.
Member States may limit or exclude the payment of compensation by that body in the event of damage to property by an unidentified vehicle.
They may also authorize, in the case of damage to property caused by an uninsured vehicle an excess of not more than 500 ECU for which the victim may be responsible.
Furthermore, each Member State shall apply its laws, regulations and administrative provisions to the payment of compensation by this body, without prejudice to any other practice which is more favourable to the victim.”
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