England and Wales High Court (Queen's Bench Division) Decisions

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1 [Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] England and Wales High Court (Queen's Bench Division) Decisions You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Moreno v The Motor Insurers' Bureau [2015] EWHC 1002 (QB) (17 April 2015) URL: Cite as: [2015] WLR(D) 177, [2015] EWHC 1002 (QB) [New search] [Printable RTF version] [View ICLR summary: [2015] WLR(D) 177] [Help] IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION Neutral Citation Number: [2015] EWHC 1002 (QB) Case No: HQ14X03591 B e f o r e : MR JUSTICE GILBART Royal Courts of Justice Strand, London, WC2A 2LL 17 April 2015 Between: TIFFANY MORENO - and - THE MOTOR INSURERS' BUREAU Claimant Defendant Daniel Beard QC and Sarah Crowther (instructed by BL Claims, Eastleigh) for the Claimant Hugh Mercer QC and Marie Louise Kinsler (instructed by Weightmans, Liverpool) for the Defendant Hearing dates: March 2015 HTML VERSION OF JUDGMENT 1 di 43 11/09/15 15:51

2 Crown Copyright MR JUSTICE GILBART : Introduction 1. This is a trial of a preliminary issue: "Whether the scope of (the Defendant's) liability to the Claimant is to be determined in accordance with the law of England or the law of Greece." The order for a trial of that issue was made by consent by Master Yoxall on 10th November On 17th May 2011 the Claimant, who was then aged 25, and who lives in England and Wales, was on holiday on the island of Zakynthos in Greece. She was on the verge of a road on that island when a car left the road and struck her. She suffered grievous injury to her legs. She has since received extensive surgical and other medical and therapeutic treatment. Her right leg has been amputated through the tibia, and her left leg required extensive surgery to repair the knee ligaments. She has had repeated surgery to her legs. She must wear a prosthesis, and also has to use a wheelchair. She continues to suffer from pain and disability. She has also endured a psychological reaction, and an exacerbation of pre-existing depression. She has suffered losses of earnings, and it is claimed that she will be at a disadvantage on the open labour market. 3. The car in question was registered in Greece. The Claimant's solicitors wrote to the Defendant Motor Insurers' Bureau ("MIB") to obtain insurer details for the vehicle. Upon enquiry, its Greek equivalent considered that the vehicle was uninsured, and that the driver (who was of Albanian extraction and perhaps nationality) was responsible for the accident. 4. The Claimant has made a claim against the MIB under Regulation 13(2) of the Motor Vehicles (Compulsory Insurance)(Information Centre and Compensation Body Regulations) 2003 (SI 2003/37) ("The 2003 Regulations"). 5. In the Defence, it is admitted that the driver was liable under the law of Greece for the accident. It is admitted that, under the law of Greece, the Greek Guarantee Fund for the purposes of the relevant EU Motor Insurance Directives (of which more below) would be liable to compensate the Claimant. Liability is therefore admitted under Regulation 13, but it is contended that the measure of compensation payable should be assessed in accordance with the law of Greece. This is a case where the level of damages available to a claimant for personal injuries would be higher if assessed according to the laws applying in England and Wales than in Greece. (Although as will become apparent it cannot be assumed that the level of provision is more generous in England and Wales than in all other EU jurisdictions.) 6. Judgment has been entered for the Claimant by consent on 9th July 2014, and an interim payment made under CPR 25. That was without prejudice to the Defendant's arguments on the applicable law. 7. The Court of Appeal in Jacobs v MIB [2010] EWCA Civ 1208 [2011] 1 WLR 2609 has held that in a Regulation 13 claim (i.e. the case of a person from England and Wales suffering injury in another EU state at the hands of a culpable but uninsured or unidentified driver, but 2 di 43 11/09/15 15:51

3 claiming in England and Wales), the law by which the assessment of compensation is to be made is that of England and Wales. It held that the right to compensation arose under the Regulations. In the judgment of Moore-Bick LJ, he addressed the effect of the coming into force of Regulation (EC) No 864/2007 of the European Parliament and Council on the law applicable to non-contractual obligations ("Rome II") on this issue. Moore-Bick LJ there said that the law applying to the existence of tortious liability has, since Rome II, been the law of the country where the injury was caused, but that the law by which the court makes the assessment of compensation under the 2003 Regulations remains the law of England and Wales. That approach was endorsed in Bloy and Ireson v MIB [2013] EWCA 1543 [2014] PIQR P9. While the comments in the judgment of the Chancellor (Etherton LJ) in that case are obiter on the effect of Rome II, its ratio adopted the interpretation of Regulation 13(2) given in Jacobs. 8. European Union Directives are not shy of using the traditional Latin names for the concepts involved. Those tags also have the advantage of being succinct and precise, and I shall use one or two. By lex fori is meant the law of the state in which the court dealing with the claim is situated, whereas lex loci delicti is the law of the state where the injury occurred, and in this case refers to Greece. (There are questions that can arise about the location of the relevant damage, but they are addressed in Rome II, and need not detain us here). Rome II applies the lex loci delicti to the issues of both liability and quantum, save in exceptional cases. The Court of Appeal has thus held in Jacobs that the lex fori applies to the assessment of compensation in claims under Regulation 13. However the Court of Appeal has since applied Rome II to actions in tort against the tortfeasor's insurer, including the rule that the assessment of compensation is made according to the lex loci delicti (see Wall v Mutuelle de Poitiers Assurances [2014] EWCA Civ 138 per Longmore, Jackson and Christopher Clarke LJJ)). The Court of Appeal there applied the lex loci delicti to the two issues of liability and the assessment of damages, while matters of procedure - such as the way in which expert evidence would be adduced was held to be a matter for the lex fori. 9. The MIB contended in Jacobs and before me that since Rome II, Regulation 13 of the 2003 Regulations cannot be applied so as to provide for a level of compensation different from that obtainable in the country where the accident occurred i.e. the application of lex loci delicti. The MIB obtained permission to appeal from the Supreme Court in Jacobs v MIB but before the appeal could be made and heard, the Court of Justice of the European Union (CJEU) gave judgment in Homawoo v GF Assurances C-412/10 [2011] ECR That held that Rome II was not in force at the relevant date in Jacobs, so that the appeal would have served no purpose and was not proceeded with. Bloy, which was decided after Jacobs, related to an accident which occurred before Rome II came into effect. 10. In this case, the MIB argues that this is a case where there can be an appeal straight from the High Court to the United Kingdom Supreme Court. It does so without demur from the Claimant, whose consent to an appeal direct to the Supreme Court under section 12 of the Administration of Justice Act 1969 is recorded in the order of Master Yoxall already referred to. As I indicated to the parties at the hearing, I shall consider whether to make such an order having received submissions in the light of my judgment. 11. The issue before the Court is twofold: (a) Does Regulation 13, on its true construction, state that the assessment of claims made under it must be assessed according to the law applying in 3 di 43 11/09/15 15:51

4 England and Wales? (b) Given that Rome II is an EU regulation and is part of the law of the United Kingdom without the need for any domestic legislative steps to bring it into effect, is the effect of Rome II such that in a case falling within the Motor Insurance Directives, and therefore the 2003 Regulations, the court must now assess compensation in accordance with the law where the accident happened (lex loci delicti) and not that of England and Wales (lex fori)? 12. Given the existence of what is agreed to be authority binding on me (Jacobs) I can only find for the Claimant on the merits of these arguments. But given the fact that this matter may well be the subject of subsequent appeal, it is right that I should set out the respective arguments of the parties. 13. To do so, I shall approach the matter under the following heads: A Levels of damages for personal injury in England and Wales compared to other EU states; B The law of England and Wales on choice of law until Rome II; C The relevant Motor Insurance Directives, and the roles of the national compensation bodies such as the MIB; D Agreement Between Compensation Bodies and Guarantee Funds of 29th April 2002; E The 2003 Regulations; F Rome II: Regulation 864/2007 of the European Parliament and of the Council on the law applicable to non-contractual obligations; G The approaches in Jacobs and Bloy; H Submissions for the Defendant MIB; I Submissions for the Claimant; J Discussion and conclusions. A Levels of damages for personal injury in England and Wales compared to other EU states 14. It was common ground before me that there may be situations where the level of damages awarded by a court under the applicable laws of states other than the United Kingdom may be higher. I was presented with a report prepared for the European Commission in 2009 which considered levels of compensation. It shows that in most respects the UK is one of the more generous systems, but not the most generous. Unfortunately, the example chosen for comparison in the report was a case where there is a claim after a death in a road accident. That raises potential problems, as the existence of a claim for wrongful death is undoubtedly a matter for the lex loci delicti - see Cox v Ergo Versicherung AG [2014] 4 di 43 11/09/15 15:51

5 UKSC 22 [2014] AC I was also provided with some details of the level of general damages for pain, suffering, and loss of amenity set out in the Book of Quantum used in the Republic of Ireland, first introduced in 2004 as part of the move to abolish jury trial in personal injury actions. Comparison with the Judicial College equivalent reveals that some suggested figures are higher, and some lower, than their English and Welsh equivalents. It of course relates only to one aspect of damages. As Mr Beard QC pointed out, claims, and especially those for the more serious injuries, may well involve claims for past loss of earnings, continuing and future losses of earnings, the costs of care and so on. There may also be arguments about the deductibility of benefits paid to an injured person in the form of pensions, disability benefits etc etc. 16. No firm conclusions can be drawn from the material placed before me. The safest course, and one accepted by both parties, is that one is unable to say whether English/Welsh assessments are more or less generous, either generally or in a particular type of case. Both parties agree that in this case the level of compensation assessed according to Greek law would be lower than that assessed according to the law of England and Wales. But in my judgment one cannot approach matters of interpretation of legislation (whether of European Regulations or Directives, or a domestic statutory instrument) on the basis of the facts of one case, or of a comparison between levels of compensation between two particular countries, or of comparisons in one class of case (say compensation for loss of earnings, or compensation for pain suffering and loss of amenity). 17. I have referred to this topic because one of the criticisms made by Mr Mercer QC of Bloy is that the Court of Appeal relied on an assumption that the levels of compensation awarded in the United Kingdom would be more generous than those awarded in other EU states. The same matter was addressed in Jacobs albeit rather more diffidently. B The law of England and Wales on choice of law until Rome II 18. In Harding v Wealands [2006] UKHL 32 [2007] 2 AC 1 the House of Lords considered the rule in the context of a claim brought in England against an Australian national in respect of injuries sustained in a motor accident in Australia. It affirmed the traditional approach that the assessment of damages was for the lex fori- see Lord Hoffman at [51]-[53]. 19. The United Kingdom is not a signatory to the Hague Convention on the Law Applicable to Road Traffic Accidents 1971, which set some choice of law rules to which I shall refer in due course. 20. It is to be noted also that the approach in England and Wales was by no means shared by other EU states. Many applied the lex loci delicti to both the issue of liability for the injury, and to the assessment of compensation. When Rome II was undergoing consideration and preparation, the difference between the approaches in various states was noted, but the final version of Rome II reflected the position of the states who apply the lex loci delicti, as I shall refer to in due course. C The relevant Motor Insurance Directives, and the roles of the national compensation bodies such as the MIB 5 di 43 11/09/15 15:51

6 21. Between 1972 and 2005 five Motor Insurance Directives were adopted. In October 2009 the Sixth Directive codified those that had preceded it. As Directives (by virtue of Article 288 of the Treaty establishing the European Community as amended by the Lisbon Treaty) they are ". binding as to the result to be achieved, upon each member State to which it is addressed, but shall leave to the national authorities the choice of form and methods" 22. The First Directive (1972/166/EC) dealt with the provision of motor insurance which covered drivers for accidents anywhere within what was then the EEC. It also provided for a national body (such as the MIB) to guarantee settlement of claims arising in its own state arising from the use of a car normally based in another state. 23. The Second Directive (84/5/EC) of 30th December 1983 required each member state to set up or authorise a body to provide compensation to those injured by uninsured or unidentified drivers. The MIB is the guarantee body for the purposes of the UK. Given the terms of the 2003 Regulations, it is necessary to set out parts of Article 1 [1] "Article 1 1. The insurance referred to in Article 3 (1) of Directive 72/166/EEC shall cover compulsorily both damage to property and personal injuries. 2. Without prejudice to any higher guarantees which Member States may lay down, each Member State shall require that the amounts for which such insurance is compulsory are at least: Each Member State shall set up or authorize a body with the task of providing compensation, at least up to the limits of the insurance obligation for damage to property or personal injuries caused by an unidentified vehicle or a vehicle for which the insurance obligation provided for in paragraph 1 has not been satisfied. The first sub-paragraph shall be without prejudice to the right of the Member States to regard compensation by that body as subsidiary or non-subsidiary and the right to make provision for the settlement of claims between that body and the person or persons responsible for the accident and other insurers or social security bodies required to compensate the victim in respect of the same accident The victim may in any case apply directly to the body which, on the basis of information provided at its request by the victim, shall be obliged to give him a reasoned reply regarding the payment of any compensation di 43 11/09/15 15:51

7 7. Furthermore, each Member State shall apply its laws, regulations and administrative provisions to the payment of compensation by this body, without prejudice to any other practice which is more favourable to the victim." 24. Up to now, the Directives did not enable someone injured by an uninsured or unidentified driver to seek compensation anywhere other than the state where the accident had happened. However the Fourth Directive (Directive 2000/26/EC) of 16th May 2000 made substantial changes. One of its main purposes was to enable an EU resident to be able to obtain compensation in respect of injury sustained in a motor accident in another EU state. 25. Articles 1 and 3 set the scene for the Directive: "Article 1 Scope 1. The objective of this Directive is to lay down special provisions applicable to injured parties entitled to compensation in respect of any loss or injury resulting from accidents occurring in a Member State other than the Member State of residence of the injured party which are caused by the use of vehicles insured and normally based in a Member State Articles 4 and 6 shall apply only in the case of accidents caused by the use of a vehicle (a) insured through an establishment in a Member State other than the State of residence of the injured party, and (b) normally based in a Member State other than the State of residence of the injured party. 3.. Article 3 Direct right of action Each Member State shall ensure that injured parties referred to in Article 1 in accidents within the meaning of that provision enjoy a direct right of action against the insurance undertaking covering the responsible person against civil liability." 26. By Article 4, each insurer is to identify claims representatives in each member state. Article 5 deals with the establishment of Information Centres. By Articles 6 and 7: "Article 6 Compensation bodies 1. Each Member State shall establish or approve a compensation body 7 di 43 11/09/15 15:51

8 responsible for providing compensation to injured parties in the cases referred to in Article 1. Such injured parties may present a claim to the compensation body in their Member State of residence: (a) if, within three months of the date when the injured party presented his claim for compensation to the insurance undertaking of the vehicle the use of which caused the accident or to its claims representative, the insurance undertaking or its claims representative has not provided a reasoned reply to the points made in the claim; or (b) if the insurance undertaking has failed to appoint a claims representative in the State of residence of the injured party in accordance with Article 4(1). In this case, injured parties may not present a claim to the compensation body if they have presented a claim for compensation directly to the insurance undertaking of the vehicle the use of which caused the accident and if they have received a reasoned reply within three months of presenting the claim. Injured parties may not however present a claim to the compensation body if they have taken legal action directly against the insurance undertaking. The compensation body shall take action within two months of the date when the injured party presents a claim for compensation to it but shall terminate its action if the insurance undertaking, or its claims representative, subsequently makes a reasoned reply to the claim. The compensation body shall immediately inform: (a) the insurance undertaking of the vehicle the use of which caused the accident or the claims representative; (b) the compensation body in the Member State of the insurance undertaking's establishment which issued the policy; (c) if known, the person who caused the accident, that it has received a claim from the injured party and that it will respond to that claim within two months of the presentation of that claim. This provision shall be without prejudice to the right of the Member States to regard compensation by that body as subsidiary or non-subsidiary and the right to make provision for the settlement of claims between that body and the person or persons who caused the accident and other insurance undertakings or social security bodies required to compensate the injured party in respect of the same accident. However, Member States may not allow the body to make the payment of compensation subject to any conditions other than those laid down in this Directive, in particular the injured party's establishing in any way that 8 di 43 11/09/15 15:51

9 Article 7 the person liable is unable or refuses to pay. 2. The compensation body which has compensated the injured party in his Member State of residence shall be entitled to claim reimbursement of the sum paid by way of compensation from the compensation body in the Member State of the insurance undertaking's establishment which issued the policy. The latter body shall then be subrogated to the injured party in his rights against the person who caused the accident or his insurance undertaking in so far as the compensation body in the Member State of residence of the injured party has provided compensation for the loss or injury suffered. Each Member State is obliged to acknowledge this subrogation as provided for by any other Member State. 3. This Article shall take effect: (a) after an agreement has been concluded between the compensation bodies established or approved by the Member States relating to their functions and obligations and the procedures for reimbursement; (b) from the date fixed by the Commission upon its having ascertained in close cooperation with the Member States that such an agreement has been concluded. The Commission shall report to the European Parliament and the Council on the implementation of this Article and on its effectiveness before 20 July 2005 and shall submit proposals if necessary. If it is impossible to identify the vehicle or if, within two months following the accident, it is impossible to identify the insurance undertaking, the injured party may 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 compensation body shall then have a claim, on the conditions laid down in Article 6(2) of this 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." 27. Thus, for an injured person in the Claimant's position (resident in England and Wales but who had suffered injury in another country at the hands of an uninsured driver) the Directive 9 di 43 11/09/15 15:51

10 provided a straightforward and timely route to obtaining compensation within her own country. The 2003 Regulations were passed to implement the Fourth Directive in the United Kingdom. I shall return to their terms in due course. 28. The travaux préparatoires for the Fourth Directive ( see the proposal dated 10th October 1997 by the European Commission for the Fourth Directive) state that: (Re Article 1 (Scope)) "In line with the principle of subsidiarity, the victim's position may be improved by providing an intermediary. This can be done without changing the rules on liability and jurisdiction that currently apply in the Member States" (page 3 para 3) (Re Article 2 Direct right of action) "The Directive does not establish new rules of law or amend conventions in the field of international law conferring private jurisdiction on courts. Both the definition of the applicable law and the establishment of the jurisdiction of the courts are determined by reference to the rules of private international law applicable in most of the member states." (page 6) (Re Article 3 (Claims Representatives)) "The paragraph does not contain any provisions on the law applicable to accidents suffered by visitors. In most cases the rules of private international law applicable in the various Member States make this the law of the State where the accident occurs. As in the case of the direct right of action, the law applicable is always determined by reference to the generally applicable rules of private international law. This Directive does not provide any criteria for the choice of the applicable law (for example, lex loci or the law of the State of Residence of the victim, etc.)" (page 7) (My italics) 29. As written, the words from the proposal in relation to Article 2 can be read as saying that the choice of law is determined by the rules of private international law applicable in most member states. However the words I have italicised in the proposal relating to Article 3, having started by echoing that approach, are then quite specific that it sets no criteria for determining choice of law. As I shall describe when I come to deal with the travaux préparatoires for Rome II, there was no desire to retain those differences. 30. A codifying Directive (the Sixth) (2009/103/EC) was made on 16th September Amongst its recitals are the following: "(20) Motor vehicle accident victims should be guaranteed comparable treatment irrespective of where in the Community accidents occur. (30) The right to invoke the insurance contract and to claim against the insurance undertaking directly is of great importance for the protection of victims of motor vehicle accidents. In order to facilitate an efficient and speedy settlement of claims and to avoid as far as possible costly legal proceedings, a right of direct action against the insurance undertaking covering the person responsible against civil liability should be provided for victims of any motor vehicle accident. 10 di 43 11/09/15 15:51

11 (34) Parties injured as a result of a motor vehicle accident falling within the scope of this Directive and occurring in a State other than that of their residence should be entitled to claim in their Member State of residence against a claims representative appointed there by the insurance undertaking of the responsible party. This solution would enable damage suffered by injured parties outside their Member State of residence to be dealt with under procedures which are familiar to them. (35) This system of having claims representatives in the injured party's Member State of residence affects neither the substantive law to be applied in each individual case nor the matter of jurisdiction. (36) The existence of a direct right of action for the injured party against the insurance undertaking is a logical supplement to the appointment of such representatives and moreover improves the legal position of parties injured as a result of motor vehicle accidents occurring outside their Member State of residence. (48) The role played by the compensation body is that of settling the claim in respect of any loss or injury suffered by the injured party only in cases which are capable of objective determination and therefore the compensation body should limit its activity to verifying that an offer of compensation has been made in accordance with the time limits and procedures laid down, without any assessment of the merits. (50) The compensation body should have a right of subrogation in so far as it has compensated the injured party. In order to facilitate enforcement of the compensation body's claim against the insurance undertaking where the latter has failed to appoint a claims representative or is manifestly dilatory in settling a claim, the body providing compensation in the injured party's State should also enjoy an automatic right of reimbursement with subrogation to the rights of the injured party on the part of the corresponding body in the State where the insurance undertaking is established. This body is the best placed to institute proceedings for recourse against the Insurance undertaking. (51) Even though Member States may provide that the claim against the compensation body is to be subsidiary, the injured person should not be obliged to present his claim to the person responsible for the accident before presenting it to the compensation body. In such a case the injured party should be in at least the same position as in the case of a claim against the guarantee fund. (52) This system can be made to function by means of an agreement between the compensation bodies established or approved by the Member States, defining their functions and obligations and the procedures for reimbursement. (53) Where it is impossible to identify the insurer of a vehicle, it should be provided that the ultimate debtor in respect of the damages to be paid to the injured party is the guarantee fund provided for this purpose situated in the Member State where the uninsured vehicle, the use of which has caused the accident, is normally based. Where it is impossible to identify the vehicle, it should be provided that the ultimate debtor is the guarantee fund provided for this purpose situated in the Member State in which the accident occurred." 11 di 43 11/09/15 15:51

12 31. The Articles of the codifying Sixth Directive contain the following: Article 3 Compulsory insurance of vehicles Each Member State shall, subject to Article 5, 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 the measures referred to in the first paragraph. Each Member State shall take all appropriate measures to ensure that the contract of insurance also covers: (a) according to the law in force in other Member States, any loss or injury which is caused in the territory of those States; (b). The insurance referred to in the first paragraph shall cover compulsorily both damage to property and personal injuries." 32. Article 6 deals with national insurers' bureaux. Articles 10 and 11 deal with the payment of compensation in cases where the accident was caused by an uninsured or unidentified vehicle. They read, insofar as is relevant "Article 10 "1. Each Member State shall set up or authorise a body with the task of providing compensation, at least up to the limits of the insurance obligation for damage to property or personal injuries caused by an unidentified vehicle or a vehicle for which the insurance obligation provided for in Article 3 has not been satisfied. The first subparagraph shall be without prejudice to the right of the Member States to regard compensation by the body as subsidiary or non-subsidiary and the right to make provision for the settlement of claims between the body and the person or persons responsible for the accident and other insurers or social security bodies required to compensate the victim in respect of the same accident. However, Member States may not allow the body to make the payment of compensation conditional on the victim establishing in any way that the person liable is unable or refuses to pay. 2. The victim may in any event apply directly to the body which, on the basis of information provided at its request by the victim, shall be obliged to give him a reasoned reply regarding the payment of any compensation.. 12 di 43 11/09/15 15:51

13 3. 4. Each Member State shall apply its laws, regulations and administrative provisions to the payment of compensation by the body, without prejudice to any other practice which is more favourable to the victim. Article 11 Disputes In the event of a dispute between the body referred to in Article 10(1) and the civil liability insurer as to which must compensate the victim, the Member States shall take the appropriate measures so that one of those parties is designated to be responsible in the first instance for paying compensation to the victim without delay. If it is ultimately decided that the other party should have paid all or part of the compensation, that other party shall reimburse accordingly the party which has paid." 33. Article 18 gives an injured person a direct right of action against the insurer of the vehicle which caused the accident. Articles 19 ff (Chapter 7) deal with the "settlement of claims" in respect of vehicles which are covered by insurance. Article 22 sets out a procedure whereby insurers are to deal with claims within 3 months of receipt of a claim. Article 24 enables claims to be brought against the compensation body in the state of residence of a claimant in cases where the insurer has not responded under Article 22. It must respond within 2 months. However if the insurer does respond, then the compensation body will terminate its action. By Article 24(2): "The compensation body which has compensated the injured party in his Member State of residence shall be entitled to claim reimbursement of the sum paid by way of compensation from the compensation body in the Member State in which the insurance undertaking which issued the policy is established. The latter body shall be subrogated to the injured party in his rights against the person who caused the accident or his insurance undertaking in so far as the compensation body in the Member State of residence of the injured party has provided compensation for the loss or injury suffered." 34. Article 25 deals with the case where the vehicle or its insurer cannot be identified within 2 months of the date of the accident: Article 25 "Compensation 1. If it is impossible to identify the vehicle or if, within two months of the date of the accident, it is impossible to identify the insurance undertaking, the injured party may 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 Articles 9 and 10. The compensation body 13 di 43 11/09/15 15:51

14 shall then have a claim, on the conditions laid down in Article 24(2): (a) where the insurance undertaking cannot be identified: against the guarantee fund 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) 2..." D Agreement Between Compensation Bodies and Guarantee Funds of 29th April On 29th April 2002, and in pursuit of Article 10 of the Fourth Motor Insurance Directive, the Compensation Bodies of the various states (the MIB and its equivalents) entered into an agreement. In the case of claims under Article 7 of the Fourth Directive (i.e. where a compensation body of the victim's member state pays compensation when the vehicle cannot be identified, or no insurer can be identified within 2 months of the accident) the Compensation Body must inform the relevant Guarantee Fund (Clause 7.1). It then continues: " 7.2 When it makes a compensation payment to an injured party, the Compensation Body shall apply, in evaluating liability and assessing compensation, the law of the country in which the accident occurred " 36. By Clause 8, reimbursement is due to the Compensation Body from the relevant Guarantee Fund as follows: "8.1 to the exclusion of everything else, the following: the amount paid in compensation to the injured party or his/her beneficiaries; specifying the amounts paid as material damage and as bodily injury; "[Fees such as those of lawyers and experts]" the amount to be reimbursed may only be disputed by the final paying Guarantee Fund if the Compensation Body has ignored objective material information given to it or has not observed the rules of applicable law." E The 2003 Regulations 37. The Explanatory Note to the Regulations, while of course not definitive, gives a concise and useful guide: "These Regulations give effect to Articles 5, 6 and 7 of the Fourth Motor Insurance Directive. In order to assist persons to seek compensation in respect of motor vehicle 14 di 43 11/09/15 15:51

15 accidents occurring in an EEA State other than their State of residence, regulation 3 establishes the MIIC as the information centre. That body shall establish a means of access to specified information, so as to allow its dissemination to injured parties in certain circumstances. Further provisions provide that in appropriate cases the information centre is obliged to seek similar information from organisations with like functions established in other EEA States. Regulation 4 describes the specified information. This includes, in the case of motor vehicles normally based in the United Kingdom, the name and address of the insurer and the number of the insurance policy in respect of any identified vehicle. Regulation 5.. Regulation 7.. Regulation 9 empowers an injured party resident in an EEA State to require the information centre to supply him with insurance details in respect of vehicles normally based in a Member State or EEA State where: (i) the accident occurs in the United Kingdom; or (ii) where the vehicle is usually based in the United Kingdom and the accident occurs in the EEA or a state subscribing to the Green Card Scheme; or (iii) where the injured party resides in the United Kingdom and the accident occurs in an EEA State or a state subscribing to the Green Card Scheme. The right of a person resident in the United Kingdom to obtain this information in respect of an accident occurring within the United Kingdom is therefore provided for, although it is not required pursuant to the Fourth Motor Insurance Directive. Regulation 10 approves the Motor Insurers' Bureau as the compensation body for the United Kingdom. Regulation 11 provides that in certain circumstances a person resident in the United Kingdom may claim compensation from the compensation body. The right to claim arises in respect of loss or injury resulting from an accident caused by the use of a motor vehicle in a public place. The accident must have occurred in an EEA State other than the United Kingdom, or in a country subscribing to the Green Card Scheme. The vehicle the use of which caused the damage must normally be based and insured, in an EEA State other than the United Kingdom. The claimant must have sought compensation from the liable insurer or his claims representative. That insurer must have failed to make a reasoned reply within three months. Further rules apply if no claims representative has been appointed. The claimant must not have commenced legal proceedings against the insurer. 15 di 43 11/09/15 15:51

16 Regulation 12 provides that in the circumstances described in regulation 11, and subject to certain provisos, if the injured party proves to the compensation body that the insured person is liable to him, then to the extent that he can prove loss and damage the compensation body must compensate him. Regulation 13 provides that in certain circumstances a person who resides in the United Kingdom may be able to claim compensation from the compensation body where either the vehicle the use of which caused the damage, or the requisite insurer, cannot be identified. The accident must have occurred in an EEA State other than the United Kingdom, or in a country subscribing to the Green Card Scheme. The vehicle must normally be based in, and insured in, an EEA State other than the United Kingdom. Regulations 14 and 15 set out circumstances in which the compensation body or the Motor Insurers' Bureau must indemnify a foreign compensation body." 38. Turning to the Regulations themselves, it is only necessary for the purposes of this judgement to set out Regulations and 16: "Compensation body for the United Kingdom 10. MIB is approved as the compensation body for the United Kingdom for the purposes of the fourth motor insurance directive. Entitlement to compensation where the insurer is identified 11. (1) This regulation and regulation 12 apply in a case where (a) an injured party is resident in the United Kingdom, (b) that person claims to be entitled to compensation in respect of an accident occurring in an EEA State other than the United Kingdom or in a subscribing state, and (c) the loss or injury to which the claim relates has been caused by or arises out of the use of a vehicle which is (i) normally based in an EEA State other than the United Kingdom, and (ii) insured though an establishment in an EEA State other than the United Kingdom. (2) Where this regulation applies, the injured party may make a claim for compensation from the compensation body if (a) he has not commenced legal proceedings against the insurer of the vehicle the use of which caused the accident, and 16 di 43 11/09/15 15:51

17 (b) either of the conditions set out in paragraph (3) is fulfilled. (3) The conditions are (a) that the injured party has claimed compensation from the insurer of the vehicle or the insurer's claims representative and neither the insurer nor the claims representative has provided a reasoned reply to the claim within the period of three months after the date it was made; (b) that the insurer has failed to appoint a claims representative in the United Kingdom, and the injured party has not claimed compensation directly from that insurer. Response from the compensation body 12. (1) Upon receipt of a claim for compensation under regulation 11, the compensation body shall immediately notify (a) the insurer of the vehicle the use of which is alleged to have caused the accident, or that insurer's claims representative; (b) the foreign compensation body in the EEA State in which that insurer's establishment is situated; and (c) if known, the person who is alleged to have caused the accident, that it has received a claim from the injured party and that it will respond to that claim within two months from the date on which the claim was received. (2) The compensation body shall respond to a claim for compensation within two months of receiving the claim. (3) If the injured party satisfies the compensation body as to the matters specified in paragraph (4), the compensation body shall indemnify the injured party in respect of the loss and damage described in paragraph (4)(b). (4) The matters referred to in paragraph (3) are (a) that a person whose liability for the use of the vehicle is insured by the insurer referred to in regulation 11(1)(c) is liable to the injured party in respect of the accident which is the subject of the claim, and (b) the amount of loss and damage (including interest) 17 di 43 11/09/15 15:51

18 that is properly recoverable in consequence of that accident by the injured party from that person under the laws applying in that part of the United Kingdom in which the injured party resided at the date of the accident. (5) The compensation body shall cease forthwith to act in respect of a claim as soon as it becomes aware that (a) the insurer referred to in regulation 11(1)(c), or the claims representative of that insurer, has made a reasoned response to the claim, or (b) the injured party has commenced legal proceedings against the insurer. Entitlement to compensation where vehicle or insurer is not identified 13. (1) This regulation applies where (a) an accident, caused by or arising out of the use of a vehicle which is normally based in an EEA State, occurs on the territory of (i) an EEA State other than the United Kingdom, or (ii) a subscribing State, and an injured party resides in the United Kingdom, (b) that injured party has made a request for information under regulation 9(2), and (c) it has proved impossible (i) to identify the vehicle the use of which is alleged to have been responsible for the accident, or (ii) within a period of two months after the date of the request, to identify an insurance undertaking which insures the use of the vehicle. (2) Where this regulation applies (a) the injured party may make a claim for compensation from the compensation body, and (b) the compensation body shall compensate the injured party in accordance with the provisions of Article 1 of the second motor insurance directive as if it were the body authorised under paragraph 4 of that Article and the accident had occurred in Great Britain. 18 di 43 11/09/15 15:51

19 Civil Liability 16. Any sum due and owing pursuant to these Regulations shall be recoverable as a civil debt." 39. While it was held in Jacobs that Regulation 13(2)(b) is not a choice of law provision, it will be observed that the effect of it is to overcome any arguments about which law applies to the claim. I shall deal with the application and interpretation of the Regulations more generally at a later stage. I shall also in due course consider the effect of Rome II (if any) on the application and interpretation of the Regulations. F Rome II: Regulation 864/2007 of the European Parliament and of the Council on the law applicable to non-contractual obligations 40. This was enacted as a Regulation within the meaning of the Article 288 of the Treaty establishing the European Community as amended by the Lisbon Treaty. It follows that it is "..binding in its entirety and directly applicable in all Member States." 41. As a result of its status as a Regulation, Member States, unless otherwise expressly provided, are precluded from taking steps for the purposes of applying the regulation, which are intended to alter its scope or supplement its provisions: see C-40/69 Hauptzollamt Hamburg-Oberelbe v Bolmann [1970] ECR 69 at [4]. 42. I shall start by citing the relevant Articles. I shall then refer to the Recitals, and then to the travaux préparatoires, which cast some light on the intended application and interpretation. Scope "CHAPTER I SCOPE Article 1 1. This Regulation shall apply, in situations involving a conflict of laws, to non-contractual obligations in civil and commercial matters. It shall not apply, in particular, to revenue, customs or administrative matters or to the liability of the State for acts and omissions in the exercise of State authority (acta iure imperii). 2. The following shall be excluded from the scope of this Regulation: (a)-(g). 3. This Regulation shall not apply to evidence and procedure, without prejudice to Articles 21 and Article 2 19 di 43 11/09/15 15:51

20 Non-contractual obligations 1. For the purposes of this Regulation, damage shall cover any consequence arising out of tort/delict, unjust enrichment, negotiorum gestio or culpa in contrahendo. 2. This Regulation shall apply also to non-contractual obligations that are likely to arise. 3. Any reference in this Regulation to: (a) an event giving rise to damage shall include events giving rise to damage that are likely to occur; and (b) damage shall include damage that is likely to occur. Universal application Article 3 Any law specified by this Regulation shall be applied whether or not it is the law of a Member State. General rule CHAPTER II TORTS/DELICTS Article 4 1. Unless otherwise provided for in this Regulation, the law applicable to a non-contractual obligation arising out of a tort/delict shall be the law of the country in which the damage occurs irrespective of the country in which the event giving rise to the damage occurred and irrespective of the country or countries in which the indirect consequences of that event occur. 2. However, where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, the law of that country shall apply. 3. Where it is clear from all the circumstances of the case that the tort/delict is manifestly more closely connected with a country other than that indicated in paragraphs 1 or 2, the law of that other country shall apply. A manifestly closer connection with another country might be based in particular on a pre-existing relationship between the parties, such as a contract, that is closely connected with the tort/delict in question. CHAPTER V COMMON RULES 20 di 43 11/09/15 15:51

21 Article 15 Scope of the law applicable The law applicable to non-contractual obligations under this Regulation shall govern in particular: (a) the basis and extent of liability, including the determination of persons who may be held liable for acts performed by them; (b).. (c) the existence, the nature and the assessment of damage or the remedy claimed; (d) within the limits of powers conferred on the court by its procedural law, the measures which a court may take to prevent or terminate injury or damage or to ensure the provision of compensation; (e) (f) persons entitled to compensation for damage sustained personally; (g).. (h) the manner in which an obligation may be extinguished and rules of prescription and limitation, including rules relating to the commencement, interruption and suspension of a period of prescription or limitation. Overriding mandatory provisions Article 16 Nothing in this Regulation shall restrict the application of the provisions of the law of the forum in a situation where they are mandatory irrespective of the law otherwise applicable to the non-contractual obligation. Rules of safety and conduct Article 17 In assessing the conduct of the person claimed to be liable, account shall be taken, as a matter of fact and in so far as is appropriate, of the rules of safety and conduct which were in force at the place and time of the event giving rise to the liability. Article 18 Direct action against the insurer of the person liable The person having suffered damage may bring his or her claim directly against the insurer of the person liable to provide compensation if the law applicable to 21 di 43 11/09/15 15:51

22 the non-contractual obligation or the law applicable to the insurance contract so provides." 43. There can be no doubt that Article 4 prescribes that in claims in tort for personal injury, the lex loci delicti (or strictly, the lex loci damni, being the laws of the state where the damage has been inflicted) applies to issues of both liability and damages, unless one of the exceptions in Articles 4.2 or 4.3 apply. That was common ground before me, and accords with the decision in the Court of Appeal in Wall v Mutuelle de Poitiers Assurances [2014] EWCA Civ 138. A distinction must be drawn between the choice of law which informs the assessment of damages (now Article 4) and the rules on evidence and procedure which will apply at the trial- see Longmore LJ at [16-20], Jackson LJ at [34-46 ], Christopher Clarke LJ at [47-53]. 44. It is instructive to refer also to the Recitals (as Jackson LJ did in Wall - see [37]): "(1) The Community has set itself the objective of maintaining and developing an area of freedom, security and justice. For the progressive establishment of such an area, the Community is to adopt measures relating to judicial cooperation in civil matters with a cross-border impact to the extent necessary for the proper functioning of the internal market. (2) According to Article 65(b) of the Treaty, these measures are to include those promoting the compatibility of the rules applicable in the Member States concerning the conflict of laws and of jurisdiction. (3) The European Council meeting in Tampere on 15 and 16 October 1999 endorsed the principle of mutual recognition of judgments and other decisions of judicial authorities as the cornerstone of judicial cooperation in civil matters and invited the Council and the Commission to adopt a programme of measures to implement the principle of mutual recognition. (4) On 30 November 2000, the Council adopted a joint Commission and Council programme of measures for implementation of the principle of mutual recognition of decisions in civil and commercial matters (3).The programme identifies measures relating to the harmonisation of conflict-of-law rules as those facilitating the mutual recognition of judgments. (5).. (6) The proper functioning of the internal market creates a need, in order to improve the predictability of the outcome of litigation, certainty as to the law applicable and the free movement of judgments, for the conflict-of-law rules in the Member States to designate the same national law irrespective of the country of the court in which an action is brought. (7) (8) This Regulation should apply irrespective of the nature of the court or tribunal seised. (9) 22 di 43 11/09/15 15:51