David Knifton QC in ground-breaking judgment on liability of MIB

September 24, 2018

In a ground-breaking judgment handed down on 14.9.18, the High Court has held that the Motor Insurers’ Bureau (MIB) is directly liable for injuries caused by the use of an uninsured vehicle on private land. In Lewis v Tindale & MIB [2018] EWHC 2376 (QB), Soole J accepted arguments from EU specialist Philip Moser QC of Monckton Chambers and David Knifton QC of Exchange Chambers that the MIB was an emanation of the state, against which the provisions of the 2009 EU Motor Insurance Directive (2009/103/EC) were directly effective.

Mr Lewis suffered grievous injuries to his spinal cord and brain when he was run down by an uninsured Nissan 4×4 vehicle driven by the 1st Defendant on private land. The vehicle had been driven along a road and footpath, before deliberately driving through a barbed wire fence onto a field, where it collided with the Claimant. The 1st Defendant had no funds and was uninsured. The claim against the MIB was resisted on the basis that the Claimant’s injuries did not arise out of the use of the vehicle on a road or other public place, and hence fell outside the scope of the compulsory insurance requirement under s. 145 of the Road Traffic Act 1988. Since the MIB’s obligation is to satisfy a judgment in respect of a “relevant liability” (i.e. one for which a contract of insurance must be in force to comply with the Road Traffic Act 1988), the MIB argued that it was not liable to meet the claim.

Following a preliminary issue trial before the High Court in Birmingham, Soole J accepted that he was bound by authority (Inman v Kenny [2001] EWCA Civ 35 and Clarke v Clarke [2012] EWHC 2118) to find that the Claimant’s injuries did not arise out of the use of the vehicle on a road or other public place, since the mere fact that a motorist had used a road or other public place in order to get to the private land where the accident happened was not sufficient to establish causation. Those cases established that the use of the vehicle on the road or other public place must inevitably have caused the accident in order to fall within s.145: the causal link was not established where the motorist had deliberately driven off the road and onto the private land. Accordingly, the 1st Defendant’s use of the vehicle on a road before taking the deliberate course of entering the field was no more than a merely fortuitous concomitant of the accident, and in no way a contributing factor.

Whilst accepting that the CJEU had authoritatively determined in Vnuk v Zavarovalnica Triglav dd [2016] RTR 10 and subsequent cases that the 2009 Directive required insurance to cover any use of a vehicle that is consistent with the normal function of that vehicle, Soole J further considered that he was unable to read down the wording of s.145(3) in accordance with the Marleasing principle, so as to omit the words “on a road or other public place”. Such an interpretation went against the grain and thrust of the legislation and would amount to an amendment, rather than an interpretation, of s.145(3). Further, it raised policy ramifications which were not for the Court, and its effect would be to impose retrospective criminal liability for the use of uninsured vehicles on private land.

On the issue of direct effect, however, the judge accepted that the provisions of the 2009 Directive were unconditional and sufficiently precise to be relied upon against any national provision which was incompatible. The CJEU in Vnuk and subsequent decisions had unequivocally established that the obligation of compulsory insurance extends to the use of vehicles on private land. Article 3 of the Directive clearly defined rights which individuals were able to assert against the State or its emanation. In the light of the decision of the CJEU in Farrell v Whitty (No. 2) concerning the Irish MIB, previous English authority that the MIB was not an emanation of state (Byrne v MIB [2009] QB 66; Mighell v Reading [1999] Lloyds Rep IR 30) had been superseded. The MIB was clearly a private law body on which the UK State had conferred a task in the public interest, and which possessed special statutory powers such as the power to oblige insurers carrying on motor vehicle insurance to be members of it and to fund it. Accordingly, the MIB was liable to satisfy the judgment on the basis that the provisions of the 2009 had direct effect against it, at least to the extent of the minimum requisite cover of €1m.

Recognising the significance of the judgment for other claims, Soole J granted the MIB permission to appeal to the CA. It is likely that the Claimant will cross-appeal on the other issues.

The instructing solicitors in the case were Thompsons.