accidents abroad...performance of the obligation in question; (b) for the purpose of this provision...

ACCIDENTS ABROAD

Bernard Doherty

September 2018

The two questions

1. Can the claim be litigated in England?

i.e. The jurisdiction question.

2. If so, which country’s law will govern the

issues in the case? i.e. The applicable

law question.

Jurisdiction: the various rules

Two main sets of rules.

1.Regulation (EU) No 1215/2012 on jurisdiction

and the recognition and enforcement of judgments

in civil and commercial matters, Brussels I Recast,

aka Judgments Regulation.

2.Common law rules found in Practice Direction B

to CPR Part 6.

Jurisdiction: other rules to be

aware of• Schedule 4 of the Civil Jurisdiction and

Judgments Act 1982 (intra-UK).

• Lugano Convention (Switzerland, Norway,

Iceland).

• Montreal Convention for carriage by air.

• Athens Convention for carriage by sea.

• Etc.

Jurisdiction: which rules apply?

• Basic rule: if the defendant is domiciled in an EU

Member State, jurisdiction is based on Brussels I

Recast: arts 4, 28.

• For domicile of companies, see art.63; of individuals,

see Civil Jurisdiction and Judgments Order 2001.

• Brussels I Recast may also apply to certain other

cases, e.g. company domiciled outside EU but with

branch inside, jurisdiction agreement.

• If defendant domiciled outside EU, jurisdiction

determined according to the common law rules.

Scope of Brussels I Recast

• Applies to civil and commercial matters (art.1(1)).

• Acta iure imperii are excluded, i.e. “public authority …

acting in the exercise of its public powers” (Lechouritou

(C-292/05)).

• Finding the dividing line:

– Netherlands v Rüffer (C-814/79) [1980] ECR 3807.

Dutch barge claim for cost of work done under treaty

with Germany acta iure imperii.

– Sonntag v Waidmann (C-172/91) [1993] ECR I-1963.

Claim against state employed teacher for fatal

accident not acta iure imperii.

Basic rule of jurisdiction

• “... persons domiciled in a Member State shall,

whatever their nationality, be sued in the courts

of that Member State” (art.4(1)).

• Basic rule is subject to exceptions discussed

below.

• In order to protect the integrity of the basic rule,

exceptions are construed restrictively: Reisch

Montage AG v Kiesel Baumaschinen Handels

GmbH (C-103/05).

Additional bases of jurisdiction

• Art 7(1):

“(a) in matters relating to a contract, in the courts for the place of

performance of the obligation in question;

(b) for the purpose of this provision and unless otherwise agreed, the place

of performance of the obligation in question shall be:

• in the case of the sale of goods, the place in a Member State where,

under the contract, the goods were delivered or should have been

delivered,

• in the case of the provision of services, the place in a Member State

where, under the contract, the services were provided or should

have been provided;

(c) if point (b) does not apply then point (a) applies.”

• Art. 7(2):

“in matters relating to tort, delict or quasi-delict, in the courts for the place

where the harmful event occurred or may occur”.


• When is a claim one in contract and when in tort?

• Autonomous question of European law under which the two

concepts are mutually exclusive so if a matter is in contract it

is not in tort (Henkel (C-167/00)).

• The mere existence of a contract not enough to make claim

one in contract. It will be in contract where the interpretation

of the contract is crucial for determining the lawfulness of the

conduct complained of (Brogsitter (C-548/12)).

• In Committeri v Club Med [2018] EWCA Civ 1889 CA held a

claim to be a matter in contract where C’s employer

contracted with holiday company to provide inter alia ice

climbing services and C injured while taking part.


• “where he is one of a number of defendants, in the

courts for the place where any one of them is domiciled,

provided the claims are so closely connected that it is

expedient to hear and determine them together to avoid

the risk of irreconcilable judgments resulting from

separate proceedings” (art.8(1)).

• “as a third party in an action on a warranty or guarantee

or in any other third party proceedings, in the court

seised of the original proceedings, unless these were

instituted solely with the object of removing him from the

jurisdiction of the court which would be competent in his

case” (art.8(2)).

Special jurisdiction in matters

relating to insurance • Articles 10-16 of Brussels I Recast provide special

rules for “matters relating to insurance.”

• Rationale is the protection of the weaker party

(Recital (18)).

• “The policyholder, the insured or a beneficiary” may

bring a claim (against the insurer) in their home

courts (art.13(2)).

• “Articles 10, 11 and 12 shall apply to actions brought

by the injured party directly against the insurer,

where such direct actions are permitted” (art. 11(2)).

Scope of insurance rules

• FBTO Schadeverzekeringen NV v Odenbreit (C-463/06)

held art. 13(2) (then 11(2) of the original Brussels I)

permits direct action against insurer to be brought in

injured person’s home court where national law permits.

• For cases arising from accidents from 11 January 2009,

national law permits direct action “if the law applicable to

the non-contractual obligation or the law applicable to

the insurance contract so provides” (Rome II, art. 18).

• Can join the tortfeasor as well as insurer, e.g. if

indemnity limit and solvent tortfeasor: Mapfre Mutualidad

v Keefe [2015] EWCA Civ 598 (N.B. appeal to Supreme

Court and ECJ reference outstanding).


• In English law, European Communities (Rights against

Insurers) Regulations 2002 create direct right for RTAs

in UK but limited to cases in which vehicle is “normally

based” in UK (reg.2(1)).

• Vehicle is normally based in state whose registration

plate it bears (reg.2(2)).

• But if car based in another Member State, insurance

policy probably governed by law of that state which will

contain a direct right of action.

• In pleading, should rely on that other state’s law rather

than English law.


• Not limited to motor claims.

– Motor claims have a particular position as Fourth

Motor Insurance Directive required every Member

State to create direct action for victims.

– However, several European countries (e.g. France,

Spain, Belgium) contain broader rights to claim

directly against the liability insurer of the tortfeasor.

• In non-motor claims, look out for territorial limits, e.g. this

policy will indemnify only against liabilities established

before the courts of Spain: Williams v Mapfre (HHJ

Halbert, Chester County Court, 13 April 2015).


• Only available to a “weaker party” so not

available to one insurer in claim against another

(GIE v Zurich Espana (C-77/04) or to a social

security body as statutory assignee of a cause of

action (Vorarlberger (C-347/08)) or to an

assignee of a claim who pursued such assigned

claims on a commercial basis (Hofsoe (C-

106/17)).

• Available to derivative claimants as long as they

are weaker party, e.g. estate of deceased,

dependants.


• Perhaps surprisingly, also available to an

employer seeking to recover wages paid to an

injured employee (KABEG v Mutuelles du Mans

(C-340/16)).

• Note also that a jurisdiction agreement in an

insurance policy (binding insurer and insured)

does not bind the injured person bringing a

direct action against the insurer (Assens Havn v

Navigators Management (UK) Ltd (C-368/16)).

Avoiding Odenbreit

• Commencing proceedings where the

accident happened under Article 7(2)?

• Negative declaration.

• Potentially available in England: Toropdar

v D [2009] EWHC 567 (QB).

• In some European countries, a defendant

not disputing liability can issue

proceedings to have damages assessed.

Avoiding Odenbreit

• Article 7(2) is potentially available for claim for

negative declaration: Folien Fischer AG v

Ritrama SpA (C-133/11) [2013] QB 523.

• Article 7(2) “exists for sound administration of

justice and the efficacious conduct of

proceedings” (paragraph 37).

• It does “not pursue the same objective as the

rules on jurisdiction laid down in sections 3 to 5

… which are designed to offer the weaker party

stronger protection” (paragraph 46).

Avoiding Odenbreit

• Four types of action by defendant (assume one

English and one foreign driver):

– Insurer sues in own name.

– Foreign driver sues in own name for benefit of

insurer.

– Foreign driver sues in own name partly for

own benefit and partly for insurer’s.

– Foreign driver sues in own name for own

injuries.

Insurer sues in own name

• As to first, insurer cannot sue in own

name using Folien Fischer.

–Where a case falls within special

jurisdiction rules, only those rules

apply: art.10.

–By special rules, insurer may sue only

in defendant’s home court: art.14(1).

Foreign driver sues in own

name for benefit of insurer• Assume that the foreign driver’s interest is

identical to the insurer’s interest. In such a

case, can the allegedly negligent driver sue in

own name relying on Article 7(2)?

• If the named claimant is merely a proxy for

the insurer, there would be an argument that

should not be allowed, since it would be a

device to evade the protection given to the

weaker party.

Foreign driver sues in own name partly

for own benefit and partly for insurer’s

• Assume now that the foreign driver is insured

but nonetheless has a genuine interest in the

litigation. For example:

– There is a limit of indemnity under the policy

which the claim might exceed.

– There is a large deductible.

• Could the foreign driver be prevented from suing

in own name for negative declaration or

assessment of damages?

Foreign driver sues in own

name for own injuries• Assume a case in which both foreign and

English driver injured.

• Foreign driver can sue English driver in

the foreign country under art.7(2).

• If English driver later sues foreign driver’s

insurer in England, English claim might be

stayed under art.30 as a related action.

• More so if liability is genuinely in issue.

Jurisdiction: common law rules

for claims in tortBy paragraph 3.1(9) of PD6B, jurisdiction

exists at common law over a claim in tort

where:“(a) damage was sustained, or will be sustained,

within the jurisdiction; or

(b) damage which has been or will be sustained

results from an act committed, or likely to be

committed, within the jurisdiction.”


for claims in tort• What type of damage suffices under (a)? Line of

cases suggesting consequential loss will suffice.

CA in Brownlie v Four Seasons Holdings Inc

[2015] EWCA Civ 665 held must be direct

damage, i.e. the initial injury. But SC at [2017]

UKSC 80 obiter only and 3-2 concluded that

damage includes consequential loss.

• NB: court has discretion to refuse jurisdiction at

common law (forum non conveniens) but not

under Brussels I Recast: Owusu v Jackson (C-

281/02).


• Also power to join co-defendants and third parties where jurisdiction

can be established over an “anchor” defendant: paragraphs 3.1(3)

and (4) of PD6B:

“(3) A claim is made against a person (‘the defendant’) on whom

the claim form has been or will be served (otherwise than in

reliance on this paragraph) and –

(a) there is between the claimant and the defendant a real issue

which it is reasonable for the court to try; and

(b) the claimant wishes to serve the claim form on another

person who is a necessary or proper party to that claim.

(4) A claim is an additional claim under Part 20 and the person

to be served is a necessary or proper party to the claim or

additional claim.”


See also power to introduce new claims against

same defendant even if the court would not have

independent jurisdiction over those claims:

paragraph 3.1(4A) of PD6B:

“A claim is made against the defendant in

reliance on one or more of paragraphs (2), (6)

to (16), (19) or (21) and a further claim is

made against the same defendant which

arises out of the same or closely connected

facts.”

Applicable Law: Rome II

• Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations.

• Being an EC Regulation, it is “binding in its entirety and directly applicable in all Member States” (now by art. 288 of the Treaty on the Functioning of the European Union).

• It will be of universal application: “Any law specified by this Regulation shall be applied whether or not it is the law of a Member State”(art. 3).

Scope of Rome II

• Rome II applies to events giving rise to

damage occurring after 11th January 2009:

Homawoo v GMF Assurances SA (C-

412/10).

• Rome II does not apply to matters of

evidence and procedure (art.1(3)) which

will be governed by the law of the forum.

1995 Act and Rome II

• Private International Law (Miscellaneous Provisions) Act 1995 Act and Rome II will continue side by side for some purposes.

• Rome II applies to “events giving rise to damage” after coming into force. Important for e.g. disease cases.

• Rome II does not apply to cases arising out of acta iure imperii (art.1(1)).

General Rules Under Rome II

• Applicable law is “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.” (art.4(1)).

• Distinguish “occurrence of damage” from “event giving rise to damage” and from “indirect consequences.”

• In fatal accident claim, the damage occurs where the accident leading to death occurs, not where the dependants suffer their loss of dependency: Lazar v Allianz SpA (C-350/14).


• Where claimant and defendant “both have

their habitual residence in the same country”,

that country’s law applies (art.4(2)).

• It “is a question of fact: has the residence of a

particular person in a particular place

acquired the necessary degree of stability”

Re LC (Children) [2014] UKSC 1.

• For example, see Winrow v Hemphill [2014]

EWHC 3164 (QB).


• Where the tort is “manifestly more closely

connected” with another country, that country’s

law applies (art. 4(3)).

• Again, see Winrow v Hemphill. But compare

Marshall v MIB [2015] EWHC 3421 (QB) (upheld

at [2017] EWCA Civ 17).

• “Manifestly,” is likely to mean exceptionally.

• The tort, not an issue in the tort.

• Consider relevant facts at date of decision, i.e.

consider consequences.

Special Regimes

• Article 5 contains special rules for

product liability cases.

• Article 7 contains special rules for

environmental liability cases.

Article 15: Scope Of Applicable

Law• Once applicable law is selected, which issues

does it govern?

• The applicable law does not govern evidence or

procedure, which are for the law of the forum

(art.1(3)).

• General rule: applicable law governs matters of

substance.

• Article 15 defines matters which courts must

treat as matters of substance.

Article 15(c): Damages

“The existence, the nature and the

assessment of damage or the remedy

claimed” are all to be governed by the

substantive applicable law.

Traditional English Law

• Matters relating to the remedy including

the assessment of damages are

procedural and for the law of the forum.

• Reaffirmed in Harding v Wealands [2006]

UKHL 32.

Ascertaining scope of foreign

law in assessment of damages• Assessing damages is a mixture of law,

fact and custom and practice.

• How to draw the line between those

aspects governed by foreign law and

those not.

• Court of Appeal has given guidance in

Wall v Mutuelle de Poitiers [2014] EWCA

Civ 138.

Wall v Mutuelle de Poitiers

• English resident suffered serious spinal injury

in road traffic accident in France.

• Claim can be brought in England (Odenbreit)

but is governed by French law (art.4(1) of

Rome II.)

• French courts assess damages using a

single expert who may consult others.

• English courts would have evidence from 8 or

10 disciplines of expert.


• Defendant’s argument: English court should

try to reach same result as French court.

To do that, it needs to use same expert

evidence.

• Claimant’s argument. That is a matter of

evidence and procedure (art.1(3)), so not

governed by Rome II. The aim is not to

achieve the same result as a French court.

• Claimant wins.


• Obiter: what amounts to foreign “law”.

• Claimant contended that only black letter

foreign law should be applied.

• Defendant contended that the English

court should also apply guidelines and

conventions.

• Defendant wins. CA says narrow

interpretation of “law” undesirable.


• Recital (33): Where “the accident takes place in

a State other than that of the habitual residence

of the victim, the court seised should take into

account all the relevant actual circumstances of

the specific victim”

• Suggestion that no need to obtain evidence of

French custom re pecuniary losses because of

Recital (33).

• Potentially helpful for claimants, but this aspect

does not appear to have been fully argued.

Cox v Ergo Versicherung

• 1995 Act case, not a Rome II case.

• But, support for giving wide scope to the

foreign applicable law from dicta. See

Lord Sumption at paragraph 23:

“The rational answer is that someone in [the

claimant’s] position should recover in respect

of a German cause of action what she would

have recovered in a German court. This has

now been achieved by changing the law.”

What 15(c) Changes

• Caps on damages? (Harding v

Wealands)

• Deductibility of benefits? (Roerig v

Valiant)

• Damages for pain, suffering and loss of

amenity? (Wall v Mutuelle de Poitiers)

• Interest? (Maher v Groupama)

• Costs? (Maher v Groupama)

Some Other Matters Specified

By Article 15• “(a) the basis and extent of liability.”

• The rules governing liability, e.g. strict or

negligence based.

• “(b) the grounds for exemption from

liability, any limitation of liability and any

division of liability.”

• Would include damages caps and

contributory negligence.


By Article 15• “(e) the question whether a right to claim

damages or a remedy may be transferred,

including by inheritance.”

• If the claim is governed by foreign

substantive law, the question of whether a

claim lies for the benefit of the estate will

be governed by that law rather than by the

Law Reform (Miscellaneous Provisions)

Act 1934.


By Article 15• “(f) persons entitled to compensation for

damage sustained personally.”

• Explanatory Memorandum: “this concept

particularly refers to the question whether

a person other than the ‘direct victim’ can

obtain compensation for damage

sustained on a ‘knock-on’ basis, following

damage sustained by the victim.”


By Article 15• Would include secondary victims, e.g. rights

of a “victime par ricochet” under French law.

• Would probably include rules governing

persons who can recover damages for

psychiatric injury following physical injury to

another.

• Would probably include rules governing who

can claim for losses arising from death of

another.


by Article 15• “(g) liability for the acts of another person”

• Vicarious liability would be obvious

example.

• “(h) rules of prescription and limitation”

• Already the case under English law since

Foreign Limitation Periods Act 1984.

• Now harder to disapply foreign limitation.

Direct right of action

• Article 18 of Rome II

“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 the non-

contractual obligation or the law applicable to the insurance

contract so provides.”

• Rule makes it possible to bring a direct action where one

of the laws to which it referred provided for such a

possibility. Not really a choice of law rule (Prüller-Frey v

Brodnig (C-240/14)).

Subrogation

Article 19 of Rome IISubrogation

“Where a person (the creditor) has a non-contractual claim

upon another (the debtor), and a third person has a duty

to satisfy the creditor, or has in fact satisfied the creditor

in discharge of that duty, the law which governs the third

person’s duty to satisfy the creditor shall determine

whether, and the extent to which, the third person is

entitled to exercise against the debtor the rights which

the creditor had against the debtor under the law

governing their relationship.”

Subrogation• Paraphrase (for our purposes):

The law governing the policy of insurance also governs the

question of whether a subrogated claim lies against the

defendant.

• An English C injured abroad will usually have travel of medical

insurance governed by English law, in which case English law

will govern the question of subrogation.

• Note residual role for law of tort. If under applicable law of

tort C has no right to claim a particular head of loss, then

subrogated claim for that head will not succeed.

• E.g. Say English law governs policy and Ruritanian law

governs tort, and say insurer pays for medical costs but

medical costs are not recoverable under Ruritanian law.

Insurer cannot recover the medical costs.

accidents abroad...performance of the obligation in question; (b) for the purpose of this provision...

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