Department for Transport held liable for flouting the Motor Insurance Directives
The Delaney case: brief facts
Department for Transport shamed
The court’s findings:
- That the meaning of the relevant provisions within the European Motor Insurance Directives was clear and obvious to the point that they were ‘close to being self-evident’.
- That there was no evidence that the DfT even took legal advice.
- That the DfT had made a deliberate decision to add an exclusion of liability in clause 6 of the 1999 Agreement when it was clearly not permitted under European law.
- The judge found the DfT ‘guilty of a serious breach of Community law’, of such severity as to warrant Francovich damages.
- He rejected the DfT's plea that its infraction was somehow inadvertent or excusable.
- As to the conflict between its policy decision and what was required under European law, the judge said: ‘the best that may be said is that the Defendant decided to run the risk, which was significant, knowing of its existence’.
- The judge repeatedly expressed his surprise at the ‘remarkable’ lack of any relevant documentary records, when ‘A provision of this sort must have been the subject-matter of detailed written discussion and deliberation within the department, and (one would have thought) a Ministerial submission. And yet we have nothing’. As to the DfT’s failure to explain its policy position, he described this as a ‘deafening silence’.
DfT inaction and obfuscation
- Discussions with the MIB and various representative groups over much need reform to both the Uninsured and Untraced Drivers Agreements had reached an impasse by late 2009.
- In February 2013 I set out the case for extensive reform of the UK statutory and extra-statutory provision in my four part series of articles published in consecutive weeks in the New Law Journal under the tile: On the Right Road?. I warned the Minister that he faced judicial review or an infringement action if he continued to do nothing to rectify the many serious breaches of European Community law.
- This warning was repeated by myself and others in response to his flawed consultation that quickly followed, see: Review of the MIB Agreements.
- The Minister then ignored our calls for a dialogue. Instead he preferred to consult with the MIB, who are most probably the true authors of the MIB Agreements.
- When I was approached by the Law Commission and asked to prepare a detailed law reform proposal for them to submit to the Lord Chancellor, which I did, their involvement was later blocked by the Minister.
- The Minister promised to publish a report setting out his detailed proposals for reforming the MIB Agreements in July 2013, that was postponed to the Autumn of 2013 and yet we have heard nothing more.
Implications of Delaney
Fourthly, the judgement ignores the unanimous Court of Appeal ruling in EUI v Bristol Alliance Partnership  EWCA Civ 1267 that wrongly confines the application of an important CJEU ruling in Rafael Bernaldez Case C-129/94 to criminal cases. I say wrongly because the Bernaldez ratio has been extended by the CJEU to civil liability scenarios in a number of subsequent rulings. Jay J applied the Bernaldez ruling as well as those of Candoline Case C-537/03 and Farrell v Whitty, Case C-356/05 to interpret the MIB Agreement. These rulings support only a very restrictive interpretation of the exclusions of liability permitted by the Directives to those expressly provided for within the Directives. This is confined to the provision within article 10.2 of the Sixth Directive (article 1.4 of the Second Directive), namely: against ‘persons who voluntarily entered the vehicle which caused the damage or injury when the body can prove that they knew it was uninsured.’