Insight from Horwich Farrelly s Large & Complex Injury Group Issue #26 11 August 2016 Alexander House 94 Talbot Road Manchester M16 0SP T. 03300 240 711 F. 03300 240 712 www.h-f.co.uk Page 1
Welcome to this week s edition of Insight. In this week s edition we look at cases relating to: What levels of damages are payable by MIB where a UK resident is injured abroad by an uninsured driver, What damages are payable by concurrent tortfeasors, When, following a default judgment, a defendant can serve a defence alleging fraud Should you have any feedback or comments please do not hesitate to contact me at malcolm.henke@h-f.co.uk. Malcolm Henke, Partner & Head of LACIG RTA - Damages The long awaited judgment in Moreno v MIB (2016) UKSC 52 has been delivered by the Supreme Court. The claimant is a UK resident. In May 2011, whilst on holiday in Greece, she was hit by a car. The car was registered in Greece and driven by an uninsured driver. It was not disputed that the driver was responsible for the accident. The claimant suffered very serious injuries. The claimant has pursued damages from the appellant UK Motor Insurers Bureau ( UKMIB ), pursuant to the Directives embodied in the Sixth Directive 2009/103/EC and which were transposed into English law by The Motor Vehicles (Compulsory Insurance) (Information Centre and Compensation Body) Regulations 2003 (SI 2003 No 37). The purpose of the arrangements introduced by the Directives and the 2003 Regulations was to ensure that compensation is available for victims of motor accidents occurring anywhere in the European Union and to facilitate their recovery of such compensation. The primary subject of this appeal was whether the scope of the claimant s claim to damages was to be determined in accordance with English or Greek law. Her concern was that Greek law would yield a lesser measure of compensation than English law. At first instance, a High Court judge considered that he was bound by previous Court of Appeal authority (Jacobs v Motor Insurers Bureau (2010)) to hold that the damages were to be determined by English law The Supreme Court unanimously allowed the appeal. The 2003 Regulations should, so far as possible, be interpreted in a sense which was not in any way inconsistent with the Directives. There was no suggestion in the 2003 Regulations or elsewhere, that the domestic legislator intended to do anything other than faithfully implement and give Page 2
effect to the Directives. Two questions were central to this appeal. The first was whether the Directives prescribe any particular approach to the scope or measure of recovery applicable in a claim against a compensation body under article 7 of the Fourth Directive (article 25(1) of the Sixth Directive). The second was, if they do, whether the language of regulation 13(2)(b) of the 2003 Regulations reflects this approach, or mandates some different approach, whatever the Directives may have required. As to the first question, viewed as a whole, the Directives were and are 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. The inference is that the victim of a motor accident is entitled to the same compensation, whether against the driver responsible, his or her insurer, or, that failing, against the Motor Insurance Bureau of the State of the accident or indeed the compensation body established in the victim s state of residence. Clauses 7.2 and 8.2 of the Agreement provided that the compensation body in the victim s country of residence was to apply, in evaluating liability and assessing compensation, the law of the country in which the accident occurred. The Agreement needed to be viewed as part of the wider scheme, which in turn needed to be construed as a consistent whole. a victim s entitlement to compensation will be measured by reference to the law of the state of the accident.. The Directives do not leave it to individual member states to provide for compensation in accordance with any law that such states may choose. On the contrary, they proceed on the basis that a victim s entitlement to compensation will be measured on a consistent basis, by reference to the law of the state of the accident, whichever of the routes to recovery provided by the Directives he or she invokes. In consequence, it also makes no difference which route is chosen to the measure of liability of the body or person ultimately responsible. Since the position as a matter of European Union law is clear, there is no need for a reference to the Court of Justice. As to the second question, the 2003 Regulations were consistent with the scheme of the Directives. The loss and damage recoverable from the UKMIB is said in regulation 12(2)(b) to be that properly recoverable in consequence of that accident by the injured party from [the insured] person under the laws applying in that part of the United Kingdom in which the injured party resided at the date of the accident. The most obvious purpose of this is to determine which of the United Kingdom s three legal systems should apply, rather than prescribing the measure of recovery in such proceedings. The decisions in Jacobs v Motor Insurers Bureau and Bloy (2013) should be over-ruled in relation to the meaning of regulation 13(2)(b). Comment This means that, contrary to earlier case law, where the MIB is sued by a UK resident for injury caused by an uninsured driver in another jurisdiction, the damages to be awarded are at the level of the place where the damage occurred, and not UK levels. Page 3
Damages - Double recovery Although it is a clinical negligence case Wright v Barts Health NHS Trust (2016) EWHC 1834 (QB) is an unusual case looking at the potential apportionment of damages between the original tortfeasor and a hospital accused of subsequent clinical negligence. The claimant had been working as a sub-contractor for a roofing company in 2011 when he fell through a skylight and sustained a series of spinal fractures. At the end of his hospital treatment he had suffered a complete spinal cord injury and was a paraplegic. He initiated proceedings against the roofing company for the whole of his loss. The company began negotiations on the basis that the claimant had been contributorily negligent as he was the senior supervisor on site and was involved in the job's risk assessment. In the meantime, the claimant sent a letter of claim for damages to the defendant hospital trust, claiming that he had suffered negligent treatment that had caused the outcome of his accident to be much worse than it should have been. In September 2014, the claimant reached a compromise agreement in his claim against the roofing company. A substantial discount for contributory negligence and litigation risk (80%) was made in agreeing the settlement sum. In November 2014, he informed the defendant of the compromise agreement and sent it details of the same. He then issued proceedings against it. act in breach of different duties to the claimant. They were therefore concurrent tortfeasors, and the release of one concurrent tortfeasor did not have in law the effect of releasing another. The proper approach to a compromise case was to focus primarily on the construction of the agreement in its appropriate factual context. The test was whether the agreement represented the full measure of the claimant's estimated loss. In the claimant's case, he had not been fully compensated. Because of the contributory negligence discount, the roofing company was not liable for the whole of the additional loss. It had neither paid nor purported to pay the whole loss caused by the defendant (on the assumption that the claimant's claim against the latter would succeed). It was therefore impossible to construe the compromise agreement in its true factual context as providing full compensation for the loss being claimed against the defendant. A settlement with one concurrent tortfeasor did not release the others unless it was clear that it was intended to have that effect, or unless the payment clearly satisfied the whole claim. There was no risk of double recovery as the claimant had agreed that appropriate credit would have to be given for the sum he had received from the roofing company if his claim succeeded. The defendant applied to strike out the claim arguing that it was an abuse of process as the claimant had been compensated in full for his loss by the agreement with the roofing company and there should be no double recovery. Refusing the application, the High Court judge held that there was a pre-clinical negligence element of the damage caused to the claimant for which only the roofing company was liable. That element included the loss which occurred after the clinical negligence but which would have occurred anyway. After the clinical negligence, there was an additional loss which would not have occurred but for the clinical negligence. Both the defendant and the roofing company were liable for that additional loss as, by causing the injury, the roofing company had exposed the roofer to the hazard of imperfect medical treatment. However, the roofing company was liable only for the proportion of the additional loss that remained due after the reduction for the roofer's contributory negligence, whereas the defendant was liable for all of it. the release of one concurrent tortfeasor did not have in law the effect of releasing another Comment There was no suggestion here that the defendant s alleged clinical negligence broke the chain of causation between the initial accident and the final outcome. The case involved concurrent, rather than joint and several tortfeasors. Accordingly, if one action had been initiated against both tortfeasors and if judgment had been given against them both, those judgments would have been in different sums. This was because each made a contribution to that part of the loss by a different tortious act in breach of different duties to the claimant. The roofing company and the defendant had each made a contribution to the additional loss by a different tortious Page 4
Serving a defence following a default judgement There seems to be little doubt that the courts are becoming more sympathetic towards defendants where evidence emerges that a claimant may have exaggerated his or her claim. In Hayden v Maidstone & Tunbridge Wells NHS Trust (2016) EWHC 1962 (QB) the claimant had suffered a back injury when attempting to transfer a patient from a trolley. She had claimed damages for personal injury and liability was admitted. Judgment in default had been entered. The trial date was vacated and the defendant was given permission to rely on covertly-recorded video surveillance evidence. The defendant applied for permission to serve a defence which pleaded that the claimant had exaggerated the consequences of her accident. The claimant applied for permission to rely on the evidence of a video evidence analysis consultant who had stated that there were irregularities with the recordings. The claimant submitted that the defendant was seeking to abuse the process of the court by slipping in a defence on causation by pleading fraud. to allow a defendant to serve a defence alleging fraudulent exaggeration after default judgment had been entered was a bespoke solution to a particular problem Allowing the defendant s application but refusing that of the claimant, the High Court judge held that there was no difference between the defendant's case as set out in its defence and that which it had proposed to advance at the trial which had been vacated. The defendant was entitled to run its case on the issue exactly as it wanted. The decision to allow a defendant to apply for permission to serve a defence alleging fraudulent exaggeration after default judgment had been entered was a bespoke solution to a particular problem. The judgment meant that the claimant was injured in an accident at work which was entirely the fault of the defendant and that she had suffered some damage as a result of that injury. She was therefore entitled to recover all the loss which she could show had been caused by the accident. What loss and damage was caused by the defendant's negligence was part of the exercise of assessing damages. Expert evidence was only necessary to the extent that it assisted the court. The video evidence analysis consultant principally sought to give evidence of what he had seen when viewing the video footage and reading the surveillance logs. All he said in addition to his factual analysis was that the operatives chose what to film and when to film. No knowledge or skill was involved in that exercise. It was factual evidence and the claimant already had permission to adduce factual evidence. Comment The judge summed up the effect of a default judgment in a personal injury case by quoting from an earlier Court of Appeal decision: Turner v. PE Toleman (1999). "No doubt defendants must acknowledge some injury to a plaintiff before judgment could properly be entered against them.that is a far cry from saying that they are necessarily liable for each and every aspect of loss and injury which the plaintiff in his pleaded claim asserts he suffered." When referring to the factual evidence of the claimant s purported video surveillance expert the judge said the factual analysis which (the expert) has done in drafting his Appendices is useful and those documents should be before the Judge. They could have been prepared by solicitors or counsel. This sounds like a costs point for the defendant to take, depending on the final outcome of the case. Page 5
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