Dr Nicholas Bevan

Dr Nicholas Bevan
www.nicholasbevan.com

Tuesday, 11 June 2019

WINNING THE UNWINNABLE MOTOR CLAIM

MIB v Lewis


Lunchtime webinar on 19 June 2019 at 13.00 hrs


There has been a programme change to accommodate the ground-breaking implications of last week's Court of Appeal ruling in Motor Insurers' Bureau v Lewis 2019 EWCA Civ 909

Book now via the Association of Personal Injury Lawyers at: https://www.apil.org.uk

In a break with 73 years of jurisprudence, the Court of Appeal has fixed the UK motor insurance industry’s’ privately-owned consortium, the Motor Insurers’ Bureau, with a new autonomous legal obligation to compensate outside the parameters of the Road Traffic Act 1988. 


Serious deficiencies in the Supreme Court’s rulings in Cameron v Liverpool Victoria Assurance [2109] and Pilling v UK Insurance [2019] may be flagged up but a more detailed consideration will be covered in a separate webinar, currently under preparation.









Thursday, 6 June 2019

COURT OF APPEAL DISMISSES APPEAL BY MOTOR INSURERS' BUREAU IN LEWIS


Motor Insurers’ Bureau v Michael Lewis [2019] EWCA Civ 909


The Court of Appeal has ruled that:
  • The Motor Insurers’ Bureau (MIB) is an emanation of the state under EU law.
  • Articles 3 and 10 of the Motor Insurance Directive 2009/103/EC that prescribe the compulsory motor insurance obligation and the role of the compensating body authorised to compensate victims of unidentified and uninsured vehicles are sufficiently clear and unconditional to have direct effect against the MIB.


These findings fix the MIB with a liability to compensate motor accident victims whose compensatory entitlement ought to be guaranteed through compulsory third party motor insurance but who are not due to the UK government’s failure to properly implement the minimum standard of compensatory protection required by the Motor Insurance Directives.

The MIB faces potentially hundreds of claims by individual motor accident victims whose compensatory entitlement have been obstructed or denied due to the government’s longstanding failure to implement basic EU law requirements for motor insurance.

The MIB’s appeal against the first instance decision in Lewis v Tindale & MIB [2018] EWHC 2376 (QB) was resoundingly dismissed.  This is an unanimously endorsed ruling.  In presenting the only reasoned judgment, Lord Justice Flaux, rejected the MIB’s numerous arguments one after the other.

The Court of Appeal has ruled, in decisive terms, that not only does the MIB’s compensatory role under the Uninsured Drivers Agreement 2015 and the Untraced Drivers Agreement 2017 make it an emanation of the state in this context, but it is also pinned with liability to compensate motor accident victims who have been wrongly denied the compensatory guarantee mandated by Articles 3 and 10 of the Motor Insurance Directive 2009/103 due to the government’s  failure to properly transpose its requirements within the Road Traffic Act 1988 and under its private law agreements with the MIB.

Flaux LJ’s involvement might strike some as poetic justice for the MIB, since this ruling overturns his earlier decision in Byrne v MIB [2007] EWHC 1268 (QB) in which he had previously ruled that (i) the MIB was not an emanation of the state so that (ii) the provisions of the Motor Insurance Directives could not have direct effect against it. I have argued over several years, in my New Law Journal articles, that the Byrne judgment was wrong on these points.  First in February 2013 later in more detail in my two-part feature, Putting wrongs to rights, 27 May and 3 June 2016.  I did so again, following the Court of Justice’s ruling in Farrell v Whitty No. 2 (Case C-413/15) [2018] in State Liability: betwixt and between Brexit (Parts 1 and 2) 27 October 2017 and 3 November 2017.  I inferred from the judgment in Byrne that information relevant to the MIB’s close working relationship with the government was withheld from the court and I asserted that the learned judge was also misinformed on the proper approach to determining whether a body is an emanation of the state.  It was noticeable at the appeal hearing in Lewis that Flaux LJ was extremely well informed, which was evident from his timely and apposite interventions.

lewis v MIB; MIB v Lewis; Motor Insurers Bureau; Emanation of the state






































I will be presenting a lunchtime webinar on 19 June 2019 for the Association of Personal Injury Lawyers on the wide-reaching implications of this important ruling. 

The MIB’s exposure to liability extends far beyond the terms of its private law agreements with the Secretary of State for Transport; beyond even the governments failure to ensure that compulsory third party motor insurance extends to private land: it opens up new areas of claim previously thought to be untouched by third party motor insurance and the Road Traffic Act 1988.

I understand that the Court of Appeal have already refused the MIB leave to appeal.  However, the MIB have indicated that they intend to apply to the Supreme Court for permission to appeal, regardless. I think the MIB would be wise to think twice about that. 

If the MIB plan to pursue their empty technical argument that Articles 3 and 10 of the Motor Insurance Directive are insufficiently clear and unconditional to qualify for direct effect then that is likely to oblige the Supreme Court to refer the issue to the CJEU for a preliminary ruling under Article 267 TFEU. The autonomous nature of the EU law motor insurance obligation requires this; it is not something that lies within the Supreme Court’s discretion.  The European Commission and the CJEU are well aware of the UK’s extensive non-conformity with EU law in this area and it so may result in a crystal clear exposition of just how extensive the MIB’s liability is.

The UK remains the subject of a wide-ranging infringement complaint that has lain dormant following the 2016 Brexit referendum.  However, any Article 267 reference is likely to be expedited in the face of an impending Brexit.   

PILLING V UK INSURANCE (part 2)


Phoenix in flames: lessons from Pilling (Part 2)


R & S Pilling t/a Phoenix Engineering v UK Insurance Ltd [2019] UKSC 16



In the first instalment of my commentary on Pilling Part I, see earlier blog, I note that the Supreme Court failed to apply the correct approach to interpreting national implementing law consistently with the objectives of a directive it is supposed to transpose into UK law.  In deciding that it was not possible to ‘read down’ section s145 Road Traffic Act 1988 with a conforming construction that included private property within the geographic scope of compulsory insurance it failed to apply the legal presumption mandated by the Court of Justice of the European Union (CJEU) n Pfeiffer v Deutsches Rotes Kreuz (Case C-297/01) [2004]. This requirement dates back to Wagner Miret (Case C 334/92) [1993] and is set out in Pfeiffer as follows:

‘…when the national court is seised of a dispute concerning the application of domestic provisions which, as here, have been specifically enacted for the purpose of transposing a directive
intended to confer rights on individuals. The national court must … presume that the
Member State, following its exercise of the discretion afforded it under that provision,
had the intention of fulfilling entirely the obligations arising from the directive concerned.’

Pfeiffer’s rule does no more than presume that a member state does not intend to flout its EU treaty obligations, without at least expressing this in clear and unequivocal terms, raises the bar considerably for any finding that a conforming interpretation is contra proferentem (i.e. goes against the grain of Parliament's legislative intentions)

Had the Justices complied with Pfeiffer, as they are obliged under the primacy of EU law to do, then they would have found that this mandatory presumption raises the bar considerably to establishing the contra proferentem exception that it relied on in its deliberations. 

I also express a second concern that in considering what is meant by Article 3 of the Motor Insurance Directive (2009/103/EC) by ‘use of a vehicle’ it did so in apparent ignorance of two recent rulings by the Court of Justice of the European Union. The first of these was delivered by the Grand Chamber and is highly authoritative: Fundo de Garantia Automóvel v Juliana (Case C 80-17) [2018]; the second being BTA Baltic Insurance Company’ AS v Baltijas Apdrošinašanas Nams (Case C 648/17) [2018].  It is abundantly clear that Article 3’s insurance requirement carries a much wider scope for the types of use requiring insurance than the UK’s common law authorities allow for.  This much is evident from the following excerpt from Juliana:

‘41      Therefore, the fact that the Court held, in essence, in the judgments mentioned in the preceding paragraph, that only situations of use of the insured vehicle which fall within the use of a vehicle as a means of transport and, therefore, fall within the concept of ‘use of vehicles’, within the meaning of Article 3(1) of the First Directive or of the first paragraph of Article 3 of Directive 2009/103, may give rise to the insurer being responsible, under a contract of insurance against civil liability in respect of the use of that vehicle, for the damage or injuries caused by the latter, does not in any way mean that the determination of whether there is an obligation to take out such insurance should be dependent on whether or not the vehicle at issue is actually being used as a means of transport at a given time.

42      In the light of the foregoing, it must be held that a vehicle which is registered and therefore has not been officially withdrawn from use, and which is capable of being driven, corresponds to the concept of ‘vehicle’ within the meaning of Article 1(1) of the First Directive and, consequently, does not cease to be subject to the insurance obligation laid down in Article 3(1) of that directive, on the sole ground that its owner no longer intends to drive it and immobilises it on private land.’

A third concern I have with the Supreme Court’s ruling is that it failed to refer this issue, as to what is meant by ‘use of a vehicle’ to the CJEU for a preliminary ruling under Article 267 TFEU. As a court of final appeal, it was the Justices non-discretionary treaty bound duty to do so.

In the second and final instalment of my commentary on Pilling I explain why the three step approach adopted by the court for construing motor policy terms is based on a logical fallacy.

This is the second time in as many months that the Supreme Court has signally failed to apply the rule of law and to deliver justice to the parties in this context.  See my critique of the Supreme Court’s ruling in Cameron v Liverpool & Victoria Insurance [2019] UKSC 6.



Monday, 20 May 2019

PILLING v UK INSURANCE [2019] UKSC 16


Phoenix in flames: lessons from Pilling


R & S Pilling t/a Phoenix Engineering v UK Insurance Ltd [2019] UKSC 16


The first installment of my mini-series on the Supreme Court's decision in Pilling is published in this week's edition of the New Law Journal (17th May 2019). I examine the court's approach to the consistent construction of the Road Traffic Act 1988 and find it wanting.

See my earlier post on this ruling. 







































In next week's installment I consider the Supreme Court's approach to policy construction.

Sunday, 19 May 2019

IS THE MOTOR INSURERS BUREAU PROPERLY ACCOUNTABLE?


At  APIL’s 2019 annual conference I attended Dominic Clayden’s update on the latest developments within the Motor Insurance Bureau and the new IT platform it is developing to handle personal injury claims by unrepresented members of the public.

After hearing the Motor Insurers Bureau’s new CEO declare that the MIB was the Ministry of Justice’s delivery partner for developing the new portal and on viewing his impressive powerpoint organisational schema that reveals the impressive range and variety of different public services it discharges on behalf of the government, I expressed puzzlement that the MIB still denies its status as an emanation of the state in the ongoing appeal in Lewis v Tindale & MIB.  The appeal was heard last week.

I suggested that the MIB has become a mini-ministry responsible for a significant proportion of the Department for Transport and Ministry of Justice’s responsibilities imposed under the European Motor Insurance Directives.  I invited him to consider reforming the constitution of this motor insurer consortium, given its important public service role.  I suggested that it should co-opt onto its board certain special interest groups, such as RoadPeace, and to make the organisation more open and accountable to the general public, who fund its operations through their insurance premiums.

I was not surprised that Dominic Clayden should reject my suggestion out of hand.  However, I was surprised by the lame excuse he gave.  He claimed that its governance was its own private concern and that if claimants choose to use its services or not then that was a matter of choice for them.  This is as obviously wrong as it is disingenuous.

One may choose to go shopping to one of several stores; claimants do not choose to be injured by another’s negligence, nor does the invocation of their legal entitlement to compensation by the only legally recognised route to redress amount to a question of  choice; it is a matter of compulsion; not free choice.

APIL Conference


Last week I attended the annual conference of the Association of Personal Injury Lawyers, of which I am a senior fellow.

It was a pleasure to join the panel to discuss ‘The Impact of Brexit’ with Katherine Deal QC of 3 Hare Court; Sarah Crowther QC of Outer Temple Chambers; Chris Deacon from Stewarts solicitors; Simon Davis, vice president of the Law Society, and Dominic Clayden the new CEO at the Motor Insurers’ Bureau.

Prior to this, Dominic Clayden presented an update on the latest developments within the MIB and the new IT platform it is developing to deal with personal injury claims by unrepresented members of the public.  He revealed that the insurance industry is investing £15m in this new online portal.  This online claims platform will be linked to a call centre.

Although much is still unknown about its precise workings, the MIB has a target of April 2020 for the system to go live.  The new portal’s launch is intended to coincide with the implementation of new reduced scale tariffs on the damages paid for soft tissue injuries sustained in road traffic accident claims, under the Civil Liability Act 2018. It is also intended to facilitate claims by litigants in person once the government’s extends the scope of the small claims track for motor claims valued up to £5,000, also planned for April 2020.

This new portal and these reforms will effectively remove, on some estimates, at least half of the present volume of road traffic accident claims from the current portal where solicitor’s receive modest levels of fixed costs from the insurers of an at-fault party. This will effectively divert a substantial quantity of routine low value civil liability litigation from solicitors practices.  Many view this as the final turn of the screw for the bulk personal injury claims sector that began with the civil justice reforms in 2013.

Listening in to a seminar that updated the membership on the progress being made on developing the new claims portal, I was reminded of the scene from Monty Python’s ‘Life of Brian’ where Michael Palin, solicitously instructs each participant: ‘Straight out; line up on the left, one cross each…’

Wednesday, 15 May 2019

LEWIS V TINDALE & MOTOR INSURERS BUREAU 2019

The appeal in Lewis v Tindale & MIB opens today in the Court of Appeal.

Extract from today's cause list:


THE MASTER OF THE ROLLS' COURT COURT 71
Before LORD JUSTICE HENDERSON
LORD JUSTICE FLAUX and
SIR STEPHEN RICHARDS
Wednesday, 15th May, 2019
At half-past 10
APPEAL
From The Queen's Bench Division
FINAL DECISIONS
B3/2018/2411 Michael Lewis (a protected party by his Litigation Friend Janet Lewis) -v- Tindale and Ors. Appeal of Second Defendant from the order of Mr Justice Soole, dated 14th September 2018, filed 5th October 2018.

This appeal will be livestreamed live via the Courts and Tribunals Judiciary website.  For more information and to view the hearing please click the link below.


This appeal is likely to engender a sense of deja vu in Lord Justice Flaux.  

Twelve years ago, in Byrne v MIB & Secretary of State for Transport  [2007] EWHC 1278 (QB), Flaux J (as he was then)  found that the MIB was not an emanation of the state and this led him to conclude that it was not bound by the direct effect, under EU law, of the provisions of the Motor Insurance Directives.

My independent research, first published in 2012, revealed that the learned judge was not only misinformed on the legal test for establishing state liability but he was also misled about the true nature and status of the MIB and its close working relationship with the Department for Transport as well as to the degree of control exercised by the latter over the MIB's compensatory role. 

It should not be forgotten that Flaux J’s judgment delivered justice to the claimant.  He found that the MIB’s strict three year time limit for applying to the MIB under the scheme for untraced drivers had been unlawfully applied against a child.  His Francovich award against the minister was later upheld by the Court of Appeal ([2008] (EWCA Civ 574), and unanimously so, it was not necessary to revisit his findings on direct effect.

My critique of the Byrne ruling is set out in my New Law Journal article: Putting wrongs to rights (Part 2), from 3 June 2016. 

The case is even stronger now, after the Court of Justice's ruling in Farrell v Whitty (no. 2) [2017]  Case C413/15, fixed  the Irish MIB with the state’s liability (‘vicariously’ so to speak): to provide redress for motor accident victims who ought (under EU law) to benefit from the compensatory guarantee mandated by the Motor Insurance Directives but who are not - due to the Irish government’s failure to fully implement that law within the Road Traffic Act 1961.  

The Irish MIB was incepted and is governed under almost identical principles to the MIB in the UK.  There are numerous disparities between the minimum standard of compensatory protection mandated by the European Motor Insurance Directives and the UK's implementation of that law within Part VI of the Road Traffic Act 1988.

This ruling had a profound influence in the first instance decision in Lewis.  The implications of  Soole J's decision being upheld in this appeal will be profound.







































For my analysis on the implications of Farrell (no. 2) see my mini-series of articles in the New Law Journal:  State liability: betwixt & between Brexit (Parts 1 & 2), 27 October and 3 November 2017