Michael Howe v Motor Insurers' Bureau
| Jurisdiction | England & Wales |
| Judge | Mr Justice Stewart |
| Judgment Date | 22 March 2016 |
| Neutral Citation | [2016] EWHC 640 (QB) |
| Date | 22 March 2016 |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ14P05029 |
[2016] EWHC 640 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Stewart
Case No: HQ14P05029
Patrick Vincent & Aliyah Akram (instructed by Stewarts Law) for the Claimant
Marie Louise Kinsler & Luka Krsljanin (instructed by Weightmans LLP) for the Defendant
Hearing dates: 7, 8, 9 & 10 March 2016
Introduction
On 30 March 2007 the Claimant, Mr Howe, was rendered paraplegic. He was driving in France and collided with a wheel which came off a lorry ahead of him. Investigation by the French authorities drew a blank as to the identity of the lorry from which came the wheel or its driver or its insurer.
From that relatively straightforward state of affairs complex issues of law arise. The preliminary issues I have been asked to determine have potential relevance in many cases. Though neither party invited me to make a preliminary reference to the CJEU at the outset of this case, it was acknowledged that I would have the power to do so. Nevertheless, having regard to paragraph 19 of the CJEU's recommendations to National Courts and Tribunals in relation to the initiation of preliminary ruling proceedings 1 I do not think that, absent a decision by this court, "the National proceedings have reached a stage at which the referring court or tribunal is able to define the legal and factual context of the case"; in any event if there is to be a reference it is "desirable for the reference to be made only after both sides have been heard."
Chronology
I am grateful to the parties for having provided an agreed chronology which I attach to this judgment as "Appendix A".
EU Legislation
In Appendix B to this judgment I set out extracts from:
• The first Motor Insurance Directive: 72/166/EEC of 24/02/1972
• The second Motor Insurance Directive: 84/5/EEC of 30/12/1983
• The fourth Motor Insurance Directive: 2000/26/EEC of 16/05/2000
[The Directives were consolidated in 2009. This sixth Directive made no material changes. The 2003 Regulations (see below) continue to refer to the earlier Directives. Therefore, I also shall do so in this judgment]
UK Legislation
In Appendix C to this judgment I set out the relevant provisions of the Motor Vehicles (Compulsory Insurance) (Information Centre and Compensation Body) Regulations 2003 ("the 2003 Regulations").
The Preliminary Issues
The order of Master Leslie, dated 7 July 2015, directs "The issues of limitation and the Defendant's liability to compensate the Claimant be tried separately as a preliminary issue."
There are four issues to be determined, namely:
1. Is the MIB's liability to compensate the Claimant pursuant to the 2003 Regulations dependent upon the similar fund in France, the Fonds de Garantie ("FDG"), being liable to compensate the Claimant in respect of his accident if he made a claim against it?
2. If so, has the limitation period expired such that the Claimant is statute barred from bringing a claim against the FDG?
3. If not, is the claim by the Claimant against the MIB statute barred?
4. If the answer to 3 is yes, is the MIB precluded from relying upon a limitation defence by reason of estoppel by convention/representation?
It is perhaps appropriate to clarify that:
(i) There is no challenge to the jurisdiction of this court.
(ii) It is common ground that French law would govern the issue of the liability of the driver of the unidentified lorry to the Claimant. It is also common ground that the driver would have been liable to the Claimant and therefore that, subject to the issue of limitation, the FDG/MIB are liable to compensate the Claimant.
(iii) The applicable law in relation to damages is not before this court. There is a leapfrog appeal on that issue in the case of Moreno v MIB2. Moreno is due to be heard by the Supreme Court in July 2016.
The First Issue: Is the MIB liable only if the FDG is liable?
The Motor Insurance Directives
When the UK joined the EEC in 1973 it became subject to the first Directive (1972). The most relevant article of that Directive is Article 3 which required motor vehicle insurance for accidents in UK territory and in the other member states. The latter requirement necessitated an amendment to the Road Traffic Act 1972. Article 7 of the first Directive also recorded that the National Bureau in each Member State guaranteed settlement of claims in respect of accidents occurring in their territory and caused by vehicles normally based in another Member State.
The second Directive of 1983/1984 required the insurers referred to in Article 3 of the first Directive to cover damage to property and personal injuries, and that each Member State set up or authorise a body to provide compensation at least up to the
limits of the insurance obligation for damage caused by unidentified or uninsured vehicles 3.The MIB's liability for untraced drivers is restricted under the 1972 Agreement to accidents occurring in Great Britain and, for uninsured drivers, to judgments obtained in a British Court. 4 Article 1(4) of the second Directive also enables a victim to apply directly to the Guarantee Body 5. Article 1(7) required each country to apply its laws, regulations etc to the payment of compensation by this body. Therefore, prior to the fourth Directive a person injured in a Member State could claim against the Guarantee Body in that state and in accordance with the laws of that state.
The fourth Directive enables a victim who suffers an accident in a Member State other than his home Member State to make his claim in his own Member State irrespective of whether it is an insured case, uninsured case or untraced driver case. Prior to this Directive and the 2003 Regulations the Claimant would have had to sue the FDG in France. In insured cases, direct action against insurers and procedures/penalties for dilatory insurers are referred to in Recitals 6. Article 1 sets out the scope of the Directive and Articles 3 – 5 deal with direct rights of action, claims representatives and information centres in relation to insured driver cases.
Under Article 6 of the fourth Directive every Member State has to establish or approve a compensatory body responsible for providing compensation to injured parties in cases referred to in Article 1, and to enable injured parties to present a claim to the compensation body in their Member State of residence in the case of delay by insurers and/or the failure by them to appoint a claims representative in the country of residence of the injured party. In those cases where the compensation body compensates the injured party, it can claim reimbursement from the compensation body in the Member State of the insurance undertaking's establishment which issued the policy.
In unidentified vehicle and unidentified insurer cases Article 7 enables the injured party to "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 Article 1 of Directive 84/5/EEC" (The second Directive). In such a case the compensation body then has a claim, on the conditions laid down in Article 6(2) of the fourth Directive:
"(a) Where the insurance undertaking cannot be identified: against the Guarantee Fund provided for in Article 1(4) of Directive 84/5/EEC in the Member State where the vehicle is normally based;
(b) In the case of an unidentified vehicle: against the Guarantee Fund in the Member State in which the accident took place;
(c) In the case of third country vehicles: against the Guarantee Fund of the Member State in which the accident took place." 7
MIB submits that:
(i) It is clear that a compensation body in the home Member State is an intermediary and not ultimately liable.
(ii) The purpose of the fourth Directive was to enable victims to sue at home in respect of accidents in other Member States.
(iii) The compensation body provisions in Article 6 and 7 are additional to the main proposals which are aimed at proper access to insurers in insured claims. In those claims reference to "the compensation to which he is entitled" 8 means the claim the victim has against the foreign insurer or driver and, in unidentified insurance or vehicle claims, against the Guarantee body of the Member State where the accident occurred. According to the MIB, the fourth Directive, in this regard, merely permits such claims to take place in the home court of the victim.
(iv) The intermediary role of the compensation body/Guarantee Fund is clear from a number of provisions 9.
The MIB further relies on the Travaux Préparatoires to support its submission that the fourth Directive did not require the compensation body in the victim's home state (here the MIB) to be liable where the foreign guarantee fund or insurer (here the FDG) was not liable. It is said that the Travaux Préparatoires demonstrate that the fourth Directive was aimed at merely permitting victims to proceed in the home state. MIB relies upon the following:
(i) The resolution by European Parliament in 1995. 10 This dealt at this stage with foreign insurer cases. Recital D provides:
"Whereas a satisfactory solution can be found only if the victim of an accident occurring outside his country of origin is able to bring a claim for damages against a duly authorised representative of the insurer of the other party to the accident established in his own Member State."
(ii) The Commission proposal 11 reflected the European Parliament's resolution as...
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