MORENO V MOTOR INSURERS' BUREAU

Moreno v Motor Insurers' Bureau [2016] UKSC 52

•          Lord Mance's Supreme Court ruling in Moreno brings the applicable law for foreign EEA untraced and uninsured driver claims into line with Rome II

•           Local standards and local law of the accident location apply

•           Jacobs v MIB [2010] EWCA Civ 1208 and Bloy v MIB 2013] EWCA Civ 1543 are overturned

      This is an extract from my PI Focus article: Impact Assessment.

The accident

On 17 May 2011 Tiffany Moreno, a UK resident, sustained grievous injuries to her legs when she was hit from behind by an uninsured driver whilst holidaying on the island of Zakynthos in Greece.  One of her legs was amputated through the tibia.  She needs a wheelchair and continues to suffer pain and psychological problems.  She has an extensive claim that includes future loss of earnings and handicap in the labour market. 

The issue

The only issue in this case was which applicable law should be used to quantify Ms Moreno’s claim: was it the more generous UK common law or was it to be determined by the less generous standards of the Greek Civil Code?

The Supreme Court ruling

The Supreme Court upheld the MIB’s appeal, ruling that Ms Moreno’s compensation should be assessed by reference to the Greek Civil Code.

It had been open to the Supreme Court to distinguish the present claim, whose accident post-dated the coming into force of Rome II, from the Jacobs and Bloy decisions, which preceded its implementation.  However, Lord Mance, who delivered the only reasoned opinion, chose a different route. 

As the Sixth Directive was not in force when the 2003 Regulations were in place his judgment refers to its predecessors, which have been incorporated into the Sixth almost word for word.  His analysis of what are now articles 3, 10, 24 and 25 of the Sixth Directive [that respectively impose (i) the third party insurance requirement, (ii) the MIB’s compensatory role for UK accidents involving uninsured and unidentified vehicles, (iii) the MIB’s role as a guarantee fund for foreign EEA accidents where either the foreign insurer or representative is not identified or fails to respond or (iv) where the foreign vehicle responsible is uninsured or unidentified] revealed no legislative discretion for member states to choose the applicable law.  The clear and consistent intention was that the applicable law should be determined by reference the country in which the accident happened.  This is to be applied uniformly, whichever of the compensatory routes were followed: identified insured, insurer not cooperating or where the vehicle is uninsured or unidentified.  By way of example, the clear implication of what is now Article 25 (2) was that the compensating body would recover its full reimbursement from its foreign counterpart.

His analysis of the 2003 Regulations opened with a restatement of the Marleasing principle, namely that they should be interpreted in a sense which is not in any way inconsistent with the Directives.  He found no indication in these regulations that their general intent was to do anything other than fully implement or give effect to the directives.  Furthermore, on the specific issue as to whether Regulation 13 intended to prescribe any particular approach to the applicable law for quantifying the damages, he found that the Court of Appeal had construed the wording too narrowly.  Viewed holistically, ‘it can be seen to be a scheme of which the constant aim has been to improve the prospects and ease with which injured parties can recover the compensation to which they are “entitled” in respect of any loss or damage caused by vehicles’ [paragraph 30].  He also considered the Green Card scheme, that applies the law of the state where the accident occurred, and the 2002 Agreement between the Bureaux whose reimbursement scheme is set at the level of award set by the same uniform rule of applicable law.

This Supreme Court judgment provides a good illustration of the potent effect that a European law consistent construction of inconsistent UK provisions can have where they fail to properly implement European law.  It will be recalled that in Churchill v Wilkinson [2012] EWCA Civ 1166 the Court of Appeal added an extensive passage of ‘notional’ wording to section 151 (8) Road Traffic Act 1988, in order to bring its defective wording into line with the Sixth Directive.   Unless and until the government decides to remedy the numerous breaches of the Sixth Directive RTA practitioners need to be alert to the fact that our national law implementation is systemically defective and that its wording cannot be taken at face value.  This applies equally to the Part VI of the Road Traffic Act 1988, the 2002 and 2003 Regulations as to both MIB Agreements.  

To access my full article on Moreno, Impact Assessment, which was published in the September 2016 issue of PI Focus, CLICK HERE.