Uk Insurance Ltd v Thomas Holden and Another

JurisdictionEngland & Wales
JudgeHis Honour Judge Waksman
Judgment Date19 February 2016
Neutral Citation[2016] EWHC 264 (QB)
Docket NumberClaim No: Folio 2014-000231
CourtQueen's Bench Division
Date19 February 2016

[2016] EWHC 264 (QB)

IN THE HIGH COURT OF JUSTICE QUEENS BENCH DIVISION LONDON MERCANTILE COURT

Before:

His Honour Judge Waksman QC

(Sitting as a Judge of the High Court)

Claim No: Folio 2014-000231

Uk Insurance Limited
Claimant
and
(1) Thomas Holden
(2) R & S Pilling Trading As Phoenix Engineering
Defendants

Graham Eklund QC (instructed by Keoghs LLP, Solicitors) for the Claimant

Michael Davie QC (instructed by DAC Beachcroft LLP, Solicitors) for the Defendant

Hearing dates: 20–21 January 2016

INTRODUCTION

1

On Saturday 12 June 2010, Mr Thomas Holden, the First Defendant and a mechanical fitter employed by the Second Defendant ("Phoenix") was working overtime at Phoenix's premises. The day before his car had failed its MOT due to corrosion on its underside. Having completed his first piece of work that day he asked his employer if he could use the loading bay at the premises to do some work on the car which would hopefully enable it to pass the MOT. His employer agreed. His intention was to weld some plates onto the underside of the car to deal with the corrosion.

2

He disconnected the car battery so there were no live circuits which the welding equipment might interfere with. He then used a fork-lift truck to push the car up on its side so that he could get at the underside. He used a grinder first to prepare the underside and then successfully welded a plate under the driver's side. He then reconnected the battery, started the car and moved it round the other way before disconnecting it again and lifting it up once more but now with the underneath of the passenger side exposed. He started to weld, but then his phone went and he stood up to take the call. As he did so, he saw flames inside the car. What had happened was that sparks from the welding had ignited flammable material inside the car including the seat covers. The fire spread and set alight some rubber mats lying close to the car. The fire then took hold in Phoenix's premises and adjoining premises and substantial damage was caused before it was extinguished.

3

Phoenix's insurer was AXA. It has paid out to Phoenix and the owner of the adjoining property in excess of £2m. Being subrogated to Phoenix's rights, AXA has now made a claim against Mr Holden in the name of Phoenix for an indemnity in respect of the sums it has paid out ("the Claim"). If Mr Holden has any insurance in respect of the Claim, it is only by reason of his ordinary car insurance effected with the Claimant, UK Insurance Limited ("UK") ("the Policy").

4

As a result UK has brought this action, seeking a declaration that the Policy does not cover the Claim. AXA, though Phoenix, denies this and counterclaims for the indemnity. Although Mr Holden is named as First Defendant he has played no part in these proceedings. He is not personally at risk since Phoenix has undertaken only to recover such sum (if any) as can be recovered from UK.

5

The trial of this action took place without any live evidence and for present purposes, the facts as recounted by Mr Holden in his witness statement dated 16 October 2010 (though signed on 9 January 2015) summarised above, can be taken as agreed. The issues which have arisen are ones of analysis and law.

6

Before descending into detail it is worth summarising broadly the rival contentions as follows: UK contends that the Policy insured Mr Holden in respect of third party claims resulting from an accident involving his car while being driven or used on a public road or other public place. Here, however, it was on private premises and moreover was not in any relevant sense being used; rather it was being repaired. Accordingly, the Policy does not respond.

7

As against that, Phoenix contends that, properly interpreted, the Policy covers accidents off-road as well. Further, repair to a car can be described as the use of it and thus the fire fell within the terms of the Policy because it was caused by such repair.

8

There are some subsidiary arguments, too, but they will be referred to in context below.

THE POLICY

9

Clause 1a of Section A provided as follows:

" Cover for you

We will cover you for your legal responsibility if you have an accident in your vehicle

and:

• you kill or injure someone;

• you damage their property; or

• you damage their vehicle.

This cover also applies to any accident involving injury or damage caused by a trailer,

caravan or vehicle which you are towing."

10

Clause 2 states that such cover will also be provided for anyone whom the insured allows to use but not drive the vehicle for social or domestic purposes or anyone getting into or out of the vehicle, among others.

11

Clause 1 of Section G, dealing with territorial limits provides as follows:

"(a) This policy provides the cover described in your Schedule in Great Britain, Northern Ireland, the Isle of Man and the Channel Islands and during Journeys between these places.

(b) It also provides the minimum cover you need by law to use your vehicle in

any country which is a member of the European Union:

and any country which the Commission of the European Community approves as meeting the requirements of Article 7(2) of the European Community Directive on Insurance of Civil Liabilities arising from using motor vehicles (number 72/166/CEE)."

12

General Exception 1 provides that the owner is not covered for the following among others:

"We will not cover any injury, loss or damage which takes place while your vehicle is being:

driven or used by anyone not allowed to drive it or used for any purpose not allowed by the Certificate…or Schedule or

driven by someone who does not have a valid driving licence or is breaking the conditions of their driving licence.

This exception does not apply if your vehicle is:

with a member of the motor trade for maintenance or repair;

stolen or taken away without your permission; or

being parked by an employee of a hotel, restaurant or car parking service."

13

The Certificate (which forms part of the Policy) contained the following declaration:

"I hereby certify that the Policy to which this Certificate relates satisfies the requirements of the relevant law applicable in Great Britain and Northern Ireland, the Republic of Ireland, the Isle of Man, the Island of Guernsey, the Island of Jersey and the Island of Alderney."

THE ROAD TRAFFIC ACT 1988

14

As is well-known it is compulsory for car drivers to have third party liability insurance, and it is a criminal offence not to. The RTA 1988 ("the Act") is the present governing statute. All motor insurance policies express themselves, one way or the other, to comply with the minimum third party liability insurance requirements of the Act. What this means is that whatever the detail of such insurance required by the Act, properly construed, the underlying policy contains such cover as well. In this case, that linkage is expressed by the certification on the Certificate set out above.

15

Section 145 of the Act, headed " Requirements in respect of policies of insurance." provides, among other things, as follows:

"(1) In order to comply with the requirements of this Part of this Act, a policy of insurance must satisfy the following conditions…

(3) Subject to subsection (4) below, the policy —

(a) must insure such person, persons or classes of persons as may be specified in the policy in respect of any liability which may be incurred by him or them in respect of the death of or bodily injury to any person or damage to property caused by, or arising out of, the use of the vehicle on a road or other public place] in Great Britain,"

THE EU MOTOR INSURANCE DIRECTIVES

16

The EU background to the Act is the series of Directives requiring member states to take measures to oblige the insurance against civil liability claims in respect of motor vehicles.

17

Article 3(1) of the First Directive (Council Directive 72/166/EEC of 24 April 1972) states that:

"Each Member State shall, subject to Article 4, take all appropriate measures to ensure that civil liability in respect of the use of vehicles normally based in its territory is covered by insurance. The extent of the liability covered and the terms and conditions of the cover shall be determined on the basis of these measures."

18

The Second Directive (Council Directive 84/5/EEC of 30 December 1983) provided that "The insurance referred to in Article 3(1) of [the First Directive] shall cover compulsorily both damage to property and personal injuries."

19

Article 1 a of the Third Directive (Council Directive 90/232/ EEC of 14 May 1990) as amended, provides:

'The insurance referred to in Article 3(1) of [the First Directive] shall cover personal injuries and damage to property suffered by pedestrians, cyclists and other non-motorised users of the roads who, as a consequence of an accident in which a motor vehicle is involved, are entitled to compensation in accordance with national civil law….'

20

The various Directives were then consolidated into the Sixth Directive (Council

Directive 2009/103 EC of 16 September 2009) which provides as follows:

(1) By Preamble (2)

"Insurance against civil liability in respect of the use of motor vehicles (motor insurance) is of special importance for European citizens, whether they are policyholders or victims of an accident. It is also a major concern for insurance undertakings as it constitutes an important part of non-life insurance business in the Community. Motor insurance also has an impact on the free movement of persons and vehicles. It should therefore be a key objective of Community action in the field of financial services to reinforce and consolidate the internal market in motor...

To continue reading

Request your trial
4 cases
  • Roadpeace v Secretary of State for Transport Motor Insurer's Bureau (Interested Party)
    • United Kingdom
    • Queen's Bench Division (Administrative Court)
    • 7 Noviembre 2017
    ...but it was useful if he did. 83 There had already been a finding that s145 RTA 1988 was not compatible with the Directive in UK Insurance Ltd v Holden [2016] EWHC 264 QB, [2016] 4 WLR 38, HHJ Waksman QC. This was because of the limitation to use of a vehicle on a road or other public plac......
  • Michael Lewis (a protected party by his Litigation Friend, Janet Lewis) v Dennis Tindale
    • United Kingdom
    • Queen's Bench Division
    • 14 Septiembre 2018
    ...road or other public place, i.e. before he entered the field. 25 He relies in particular on the decision of the Court of Appeal in UK Insurance Ltd v. Holden [2017] QB 1357 and its summary of propositions as to the meaning of ‘use of the vehicle’ in s.145(3)(a) which ‘…can be derived from t......
  • UK Insurance Ltd v Holden and Another
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 12 Abril 2017
    ...as Phoenix Engineering, against the decision of Judge Waksman, QC, sitting as a High Court judge in the London Mercantile CourtWLR([2016] 4 WLR 38) that the claimant, the motorist's insurer, UK Insurance Ltd, was not liable to indemnify the first defendant motorist, Thomas Holden, in respec......
  • R & S Pilling t/a Phoenix Engineering v UK Insurance Ltd
    • United Kingdom
    • Supreme Court
    • 27 Marzo 2019
    ...are entitled to compensation in accordance with national civil law.” The prior judgments 18 In a judgment dated 19 February 2016 ( [2016] EWHC 264 (QB); [2016] 4 WLR 38) which the Master of the Rolls correctly described as “clear and careful”, Judge Waksman QC, sitting as a Judge of the H......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT