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A Tale of Two Countries: applicable law in a claim against a foreign (French) insurer

Kira Middleton v Allianz IARD SA v Erika Lee Middleton [2012] EWHC 2287 (QB)

 

 

This matter arose out of a road traffic accident in France on 6 February 2002. The Claimant was a child born on 28 September 1999. The Defendant was an insurance company registered in France. The Third Party was the Claimant’s mother and became a party to the proceedings when a Part 20 (additional) claim was brought against her by the Defendant. The Claimant and the Third Party were British nationals. On 6 February 2002 they were in France; the Claimant lived there with her mother at the time (in the house of her grandmother near Bergerac, France).  A family friend (also a British national), was visiting the home of the Claimant’s grandmother. The friend was driving a Renault Espace vehicle and reversed at a time when the Claimant was behind her. The Claimant was struck and knocked to the ground by the reversing vehicle. The Claimant suffered a very significant brain injury, together with other injuries of the utmost seriousness. The Claimant was in a coma for 4 weeks. She was left with very significant care, medical, physiotherapy and accommodation/equipment needs. In the period since the accident the Claimant and her mother had returned to England where the Claimant was, by the time she issued proceedings, domiciled.

It was common ground that the Claimant was entitled to bring proceedings directly against the French-registered insurer in the English Courts (being the Courts of the Claimant’s domicile) by virtue of section 3 of EU (Council) Regulation 44/2001 and the decision of the European Court of Justice in FBTO Schadeverzekeringen NV v Jack Odenbreit ECJ 13 December 2007 [2007] EUECJ C-463/06.

The issue in the case concerned applicable law. The parties agreed that this issue was to be determined by reference to Part III of the Private International Law (Miscellaneous Provisions) Act 1995. The starting point was that French law – the lex loci delicti (the law of the place where the events constituting the tort occurred) – should be applied. However, the presumption that French law applied could be displaced where the Court was satisfied that it was, by reference to section 12 of the 1995 Act, “substantially more appropriate” to apply the law of another country in preference to the lex loci delicti. 

The Claimant’s case was that French law, as the law of the place where the accident occurred, was applicable to the substantive issues in the claim and, by virtue of the same and the application of the French Loi Badinter, the liability of the tortfeasor (for which the Defendant was obliged to provide insurance indemnity) was strict. The effect of this would be that contribution from the Claimant’s mother would not be available. Unsurprisingly, the Third Party made common cause with the Claimant on this issue. The Defendant’s case was that it was substantially more appropriate that English law should be applied (in preference to French law). The question of the law applicable to the claim was tried as a preliminary issue by Griffith Williams J and a reserved judgment was handed down on 1 August 2012.

The Claimant’s arguments prevailed and it was held that it was not substantially more appropriate to apply English law to the substantive issues in the case, including liability. Accordingly, French law applied (with the result that the Claimant would be able to rely on the Loi Badinter). The Judge applied the conventional three-stage process to the section 11/section 12 exercise in which stage one involves identifying the issue to which it is suggested the general (section 11) rule is not to be applied (for example, the issue of liability); stage two involves identifying the factors which connect the tort to the place where it happened (France) and the factors which connect the tort to the forum (England); and, stage three requires an assessment of the significance of these factors (as they connect the tort to each jurisdiction) to determine whether section 12 should be applied (see, Roerig v Valiant [2002] 1 WLR 2304 (CA)). The Claimant, her mother (the Third Party) and their wider family had a longstanding and significant connection with France (where they were living when the accident occurred) and, although they had moved back to England in the period since the accident, it is not surprising that their connection with France persuaded the Judge that it was not substantially more appropriate to apply English law.

The significance of the decision lies in the Judge’s rejection of the following (somewhat novel) arguments advanced by the Defendant at trial. First, the Judge was not persuaded that the coincidence in the nationality of the Claimant, her Mother (Third Party) and tortfeasor should be given greater weight than the domicile of these parties – and the French insurer – at the time that the accident occurred (ie. they were all domiciled in France). It had been argued for the Defendant that nationality was a more stable feature than domicile (which could, as here, change over time) and so should be given proportionately greater weight. This argument did not succeed and represents, perhaps, a more or less subtle change of emphasis from the approach taken in Edmunds v Simmonds [2001] 1 WLR 1003 (QBD) (where the country of registration of the insurer was accorded less weight) and Harding v Wealands [2005] 1 WLR 1539 (CA) where, in the Court of Appeal (before the case was appealed on a different issue to the House of Lords), nationality of the tortfeasor was given considerable weight as a material factor. Second, the Judge was similarly unpersuaded that it was more appropriate for English law to be applied because, as a result of English authority (Harding Wealands [2007] 2 AC 1 (HL(E)), the Claimant’s damages would be assessed according to English law in any event because such assessment is governed by the law of the forum even where foreign law applies to the substantive issues (the Defendant had pointed out that, at odds with the conventional approach in continental legal systems, the English common law permitted different issues to be determined by the law of different jurisdictions and also recognised a distinction between the substantive issues (determined by the applicable law of the tort) and the procedural (determined by the law of the forum)). It was held, rejecting the Defendant’s argument, that the accident occurred in France where the Loi Badinter would apply and, by implication, the injured party (and insurer) would have a reasonable expectation that the Claimant would take advantage of this – a view that was consistent with interim payments and correspondence from the Defendant insurer which, contrary to its stance in the preliminary issue, had initially proceeded on the basis that the French Loi Badinter would apply (the Judge’s conclusions in this regard represent a departure from the approach taken in Dawson & Dawson v Broughton (2007) 151 Sol J 1167).

This is, perhaps, one of the last cases where applicable law will be determined by reference to Part III of the Private International Law (Miscellaneous Provisions) Act 1995. Accidents which post-date 11 January 2009 are now dealt with by reference to the rather different considerations of the Rome II Regulation on applicable law (see, European Parliament and Council Regulation (864/2007) on the Law Applicable to Non-contractual Obligations).

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