Georgina Bloy and Another v Motor Insurers' Bureau
| Jurisdiction | England & Wales |
| Judge | The Chancellor, Sir Terence Etherton,Lady Justice Hallett,Lady Justice Sharp |
| Judgment Date | 29 November 2013 |
| Neutral Citation | [2013] EWCA Civ 1543 |
| Docket Number | Case No: B3/2013/0664 |
| Court | Court of Appeal (Civil Division) |
| Date | 29 November 2013 |
[2013] EWCA civ 1543
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MANCHESTER DISTRICT REGISTRY
Royal Courts of Justice
Strand, London, WC2A 2LL
The Chancellor of the High Court
Lady Justice Hallett
and
Lady Justice Sharp
Case No: B3/2013/0664
Alexander Layton QC and Matthew Chapman (instructed by Clyde & Co) for the Claimants/Respondents
Fergus Randolph QC (instructed by Weightmans LLP) for the Defendant/Appellant
Hearing dates: 22 October 2013
Approved Judgment
Introduction
This is an appeal from a decision of His Honour Judge Platts, sitting as a High Court Judge in the Manchester District Registry, on a preliminary issue concerning the law applicable to the assessment of compensation payable to the claimants by the defendant, the Motor Insurers' Bureau ("the MIB"). The claim arises out of a car accident in Lithuania, in which the claimants were injured. Judge Platts held that the compensation payable by the MIB to the claimants is to be determined entirely by reference to English law, and, in particular, without regard to the monetary limit on compensation that would apply under Lithuanian law.
The factual background
The claimants are British citizens who are domiciled and resident in England. The first claimant is the mother of the second claimant and sues as the second claimant's litigation friend. On 7 September 2007 they suffered serious injuries in a road traffic accident in Lithuania. The second claimant was just under four months old at the time of the accident. He suffered catastrophic injuries, including severe brain damage, resulting in permanent symptoms and the need for life-long care.
The accident was the fault of a Lithuanian national who was domiciled in Lithuania, Daviva Ramanciuckiene. She was subsequently convicted by a Lithuanian court of driving while under the influence of alcohol, careless driving and driving a motor vehicle without insurance. At the date of the accident her insurance had lapsed.
The MIB
The MIB is a company limited by guarantee, whose members include all insurers authorised to issue policies of motor insurance in the United Kingdom. At the time of the accident it was obliged by the Uninsured Drivers Agreement 1999 and the Untraced Drivers Agreement 2003 to pay compensation to persons injured in motor accidents where the culpable driver was uninsured or could not be traced. The Uninsured Drivers Agreement 1999 extends to accidents occurring in Great Britain and Member States of the European Economic Area. The Untraced Drivers Agreement 2003 applies to accidents occurring in Great Britain.
The MIB is also the compensation body which, pursuant to The Motor Vehicles (Compulsory Insurance) (Information Centre and Compensation Body) Regulations 2003 SI 2003/37 ("the 2003 Regulations"), is obliged to compensate persons resident in the United Kingdom who have been injured in a car accident occurring in a different Member State of the European Union if, among other situations, the driver who caused the accident has no insurance. The 2003 Regulations were made pursuant to the Fourth Motor Insurance Directive — Council Directive 2000/26/EC of 16 May 2000 ("the Fourth Motor Insurance Directive").
The Motor Insurance Directives
The background to the Motor Insurance Directives of the European Union was set out in detail in the judgment of Moore-Bick LJ in Jacobs v Motor Insurers' Bureau [2010] EWCA Civ. 1208, [2011] 1 WLR 2609. He referred in paragraph [8] to the 'Green Card' scheme which motor insurers in a number of countries have operated since 1949, and under which the representatives of an insurer in one state handle claims on behalf of an insurer established in another state. The MIB was, and remains, the representative body responsible for operating the 'Green Card' system in the United Kingdom. That system provided part of the foundation for legislation put in place by the EU to ensure that compensation is available for those injured in road accidents regardless of the Member State in which the victim resides or in which the accident occurred.
The principal relevant EU legislation comprises Council Directive 72/166/EEC of 24 August 1972, Council Directive 84/5/EEC of 30 December 1983 and the Fourth Motor Insurance Directive. All those Motor Insurance Directives were consolidated, with other provisions and in slightly modified form, in the Sixth Motor Insurance Directive — Directive 2009/103/EC of 16 September 2009 ("the Consolidated Directive"). The consolidated Motor Insurance Directives were at the same time repealed. Although the Consolidated Directive came into existence after the accident in the present case and is not retrospective, the case has been argued by both sides before us by reference to the Consolidated Directive on the footing that no different results would flow from the language used in the Consolidated Directive as compared with the earlier Motor Insurance Directives. That was the position also taken by Waller LJ in Churchill Insurance Company Limited v Wilkinson [2010] EWCA Civ 556 at [17].
Reference was made during the hearing to a number of recitals in the Consolidated Directive. They are set out in the Appendix to this judgment.
The substantive provisions of the Consolidated Directive dealing specifically with compensation for injured parties following an accident in a Member State other than their residence are in Chapter 7 of the Consolidated Directive. The relevant provisions in Chapter 7 are Articles 20, 24 and 25, which are as follows so far as relevant:
"Article 20
Special provisions concerning compensation for injured parties following an accident in a Member State other than that of their residence
The object of Articles 20 to 26 is to lay down special provisions applicable to injured parties entitled to compensation in respect of any loss or injury resulting from accidents occurring in a Member State other than the Member State of residence of the injured party which are caused by the use of vehicles insured and normally based in a Member State."
"Article 24
Compensation bodies
1. Each Member State shall establish or approve a compensation body responsible for providing compensation to injured parties in the cases referred to in Article 20(1).
Such injured parties may present a claim to the compensation body in their Member State of residence:
…..
2. The compensation body which has compensated the injured party in his Member State of residence shall be entitled to claim reimbursement of the sum paid by way of compensation from the compensation body in the Member State in which the insurance undertaking which issued the policy is established.
The latter body shall be subrogated to the injured party in his rights against the person who caused the accident or his insurance undertaking in so far as the compensation body in the Member State of residence of the injured party has provided compensation for the loss or injury suffered.
Each Member State shall be obliged to acknowledge this subrogation as provided for by any other Member State.
3. This Article shall take effect:
(a) after an agreement has been concluded between the compensation bodies established or approved by the Member States relating to their functions and obligations and the procedures for reimbursement;
(b) from the date fixed by the Commission upon its having ascertained in close cooperation with the Member States that such an agreement has been concluded."
"Article 25
Compensation
1. If it is impossible to identify the vehicle or if, within two months of the date of the accident, it is impossible to identify the insurance undertaking, the injured party may apply for compensation from the compensation body in the Member State where he resides. The compensation shall be provided in accordance with the provisions of Articles 9 and 10. The compensation body shall then have a claim, on the conditions laid down in Article 24(2):
(a) where the insurance undertaking cannot be identified: against the guarantee fund in the Member State where the vehicle is normally based; …"
Articles 9 and 10 specify minimum levels of compensation, including a reduced level payable prior to 11 December 2009. The relevant provisions are as follows:"
"Article 9
Minimum amounts
1. Without prejudice to any higher guarantees which Member States may prescribe, each Member State shall require the insurance referred to in Article 3 to be compulsory at least in respect of the following amounts:
(a) in the case of personal injury, a minimum amount of cover of EUR 1 000 000 per victim or EUR 5 000 000 per claim, whatever the number of victims;
(b) in the case of damage to property, EUR 1 000 000 per claim, whatever the number of victims.
If necessary, Member States may establish a transitional period extending until 11 June 2012 at the latest within which to adapt their minimum amounts of cover to the amounts provided for in the first subparagraph.
Member States establishing such a transitional period shall inform the Commission thereof and indicate the duration of the transitional period.
However, until 11 December 2009 at the latest, Member States shall increase guarantees to at least a half of the levels provided for in the first subparagraph.
…"
"Article 10
Body responsible for compensation
1. Each Member State shall set up or authorise a body with the task of providing...
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