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Pierre Janusz and Katherine Deal, barristers at 3 Hare Court Chambers, explain the ‘significant and immediate’ ramifications of the Supreme Court’s decision in Moreno v Motor Insurers’ Bureau.
The Supreme Court held that the scope of the respondent’s claim for damages against the appellant Motor Insurers’ Bureau (MIB) for her motor vehicle accident while on holiday in Greece was to be determined in accordance with Greek law. The
relevant European Directives prescribed that approach and regulation 13(2)(b) of the Motor Vehicles (Compulsory Insurance) (Information Centre and Compensation Body) Regulations 2003, SI 2003/37, (the 2003 Regulations) had not mandated some different
The single issue that the Supreme Court had to decide was what law applied to questions of quantum in a case brought under the 2003 Regulations, reg 13. Under the 2003 Regulations, reg 13 a person resident in the UK who is the victim of a road traffic
accident in an EEA state other than the UK caused by a vehicle normally based in an EEA state can bring a claim for compensation against the MIB if he or she has asked the MIB under the 2003 Regulations, reg 9(2) for information regarding the insurance
relating to the vehicle concerned and it has proved impossible either to identify the vehicle or, within a period of two months after the request, to identify an insurer for the vehicle. The issue was whether the applicable law was that of the country
where the accident occurred (in this case, Greece) or the law of England and Wales (the claim having been brought in the English High Court).
In an earlier Court of Appeal decision, Jacobs v Motor Insurers’ Bureau  EWCA Civ 1208,  All ER (D) 256 (Oct), it had been held that in a claim under the 2003 Regulations, reg 13 that, although the question of liability was to
be determined according to the applicable law identified in accordance with normal conflicts of laws rules, questions of quantum were governed by English law, and this had been followed in the subsequent Court of Appeal decision of Bloy v Motor Insurers’ Bureau  EWCA Civ 1543,  All ER (D) 344 (Nov) where it was held that a cap on damages under Lithuanian law (being the law of the place where the accident occurred) did not apply to the claim brought under the 2003 Regulations, reg 13.
The Supreme Court decided unanimously that the law applicable to the quantum of damages was the law of the country where the accident had occurred. In coming to this decision it had regard to:
It followed this approach because the 2003 Regulations were enacted in order to comply with the UK’s obligation to transpose the requirements of the Fourth Motor Insurance Directive 2000/26/EC into UK domestic law, which included a requirement to
provide a victim with a claim in the circumstances where the 2003 Regulations, reg 13 applies, and because it considered that the Green Card scheme and the agreement of 29 April 2002 assisted in understanding what the Motor Insurance Directives were
intended to achieve.
It was noted that the effect of the decisions in Jacobs and Bloy was that different principles governing the quantum of a claim could apply depending on whether someone in the position of the claimant in those cases or in the position of
Ms Moreno chose to bring their claim in England under the 2003 Regulations, reg 13, or in the courts of the country where the accident occurred against the equivalent of the MIB in that country. In some cases this could mean that a claimant would
recover more in an English court, because either English law was more generous with regard to damages or because (as in Bloy) a cap on damages which would apply elsewhere would not apply here, but in others the claimant could be worse off by
suing here under the 2003 Regulations, reg 13. The effect could also be that the MIB would have to pay a claimant more than it could recover from the compensation body or fund in the other Member State (either the state where the accident occurred
or the state where the vehicle in question was normally based) under the agreement of 29 April 2002.
Looking at the scheme as a whole (including the agreement of 29 April 2002) the court decided that it was the intention that the victim of an uninsured or unidentified vehicle was to have his or her compensation measured by reference to the law of the
state where the accident occurred and that it was not open to any individual Member State to provide for compensation according to a law of its choice. With this in mind, it construed the not unambiguous wording of the 2003 Regulations, reg 13 in
such a way so as to conform with the purpose and intention of the scheme of the Directives which it had discerned. Accordingly, the court overruled Jacobs and Bloy and held that on the facts of Ms Moreno’s claim, the quantum of
her claim was to be determined in accordance with the law of the country where the accident occurred, ie Greece.
The Supreme Court’s decision makes the law very clear in relation to a claim such as Ms Moreno’s under the 2003 Regulations, reg 13. There is now no doubt that the 2003 Regulations, reg 13 does not prescribe that the quantum of a claim made
under it is in all cases to be determined in accordance with English law (as had been decided in Jacobs).
The Supreme Court does not however expressly address the question of what the position would be in a case where under the provisions of Regulation (EC) 864/2007 (Rome II), the applicable law of the tort would not be the law of the country where the accident
occurred. If, for example, a married couple habitually resident in England were on holiday in Greece and were travelling in a locally registered car they had borrowed from a Greek resident which was uninsured and were involved in a single car accident,
for which the husband driver was solely responsible, the applicable law of the claim by the wife against her husband would be English law pursuant to Rome II, art 4(2). It is suggested that in that case, because liability is to be determined according
to English law, questions of quantum under the 2003 Regulations, reg 13 would also fall to be determined by English law.
Another area of uncertainty in this broad area of law is what law applies to questions of quantum in a claim against the MIB under the 2003 Regulations, reg 12. The 2003 Regulations, reg 12 permits a UK resident victim of a road traffic accident in another
EEA state to bring a claim against the MIB if the insurer of the vehicle concerned is dilatory in dealing with the claim. The literal wording of the 2003 Regulation indicates that quantum of such a claim is governed by the law of the part of the UK
in which the victim resides, and such was considered to be the case in Jacobs. The 2003 Regulations, reg 12 was not directly in issue in Moreno, but at para  of the Supreme Court judgment, there is a strong indication that this interpretation
of the words is not to be accepted and that the position under the 2003 Regulations, reg 12 is that compensation is to be determined according to the law applicable to the claim against the person liable for the accident, which will normally be the
law of the country where the accident occurred.
The ramifications are significant and immediate. Claimants injured by an untraced or uninsured driver in another EU Member State will have their damages assessed by reference to the law and principles of assessment in that foreign jurisdiction, rather
than (as was the case) by reference to more familiar English (or Scottish or Northern Irish) principles. In the vast majority of cases, that will result in lower overall awards of damages for claimants injured overseas and seeking to pursue their
The other main ramification is that, with these foreign principles now applying, expert evidence of those foreign principles will be needed (just as they currently are in Rome II cases including motor claims brought against foreign insurers). That will
add to the costs. The MIB may find that what it wins on the swings, it loses on the roundabouts.
The ramifications of the decision post-Brexit are, potentially, another matter. The extent to which the 2003 Regulations (enacted under section 2 of the European Communities Act 1972 as amended to bring into English law the provisions of various Directives—which
only apply to EEA Member States), or indeed Rome II itself, will continue to apply once the UK leaves the EU (or the EEA) is, for now, entirely unclear.
Moreno confirms what the state of the law is. So even longstanding claims due to be tried imminently will be caught by the ruling. Clients bringing a claim against the MIB based on the 2003 Regulations will need to be advised, with immediate effect,
that their damages will now be determined by reference to the law of the country where the accident happened, as indeed will issues of liability. Most will no doubt long since have been advised that Moreno was proceeding to the Supreme Court
(and many similar claims have been stayed in the interim) so this should not come as too much of a surprise.
In established claims, it will be necessary to revert to the court to seek permission for expert evidence of the foreign law, with the knock-on effect on the rest of trial directions, and not forgetting permission for a foreign medico-legal expert in
It will also be necessary as a matter of good practice to revisit any Part 36 offers which may have been made by either side in order to ensure that claimants are properly protected and legal expense/after the event insurers adequately informed.
The decision is very much in line with the reasoning of the Supreme Court in Cox v Ergo Versicherung AG  UKSC 22,  All ER (D) 16 (Apr)—effectively and comprehensively stepping back from the old common law emphasis on the law of
the forum and reiterating emphasis on consistency between liability and heads of damage on the one hand, and measure of compensation on the other. Jacobs harked back to a different time with a different emphasis, very much against the spirit
of consistency across the different areas of EU law such as jurisdiction and choice of law. It will be interesting to see how the Supreme Court approaches Brownlie v Four Seasons Holdings Incorporated—permission to appeal granted
to the defendant in January 2016—especially given that the need for internal consistency between different EU instruments was very much part of Arden LJ’s judgment (see Brownlie v Four Seasons Holdings Incorporated  EWCA Civ
665,  All ER (D) 77 (Jul)).
But what will be so interesting is what happens in the post-Brexit world. If the 2003 Regulations (and indeed directly effective Motor Insurance Directives) are not expressly ‘saved’ into English law—along with the Brussels jurisdictional
regime and indeed Rome II, they will cease to apply at the moment the UK leaves the EU—intended to be no more than two years from the triggering of Article 50 on the Treaty on European Union. Theresa May has indicated that is likely to happen
at the end of 2016. And even if they are saved into English law, they will be subject to revision and overruling and statutory amendment in the usual way, without (at least on the face of it) a need to reflect or abide by whatever comes out of Brussels
So Moreno is the final word, for now—whether it will remain the final word remains to be seen.
Pierre Janusz’s practice comprises general commercial and common law litigation, with a strong emphasis on real property and landlord and tenant work, and associated professional negligence claims. He has substantial experience of handling cases with an international element, with expertise in matters involving jurisdiction and applicable law issues in relation to accidents abroad. Pierre is a regular speaker at the Association for Personal Injury Lawyers (APIL) on current topics.
Katherine Deal specialises in all aspects of personal injury litigation. She has a particular expertise dealing with claims arising from overseas accidents, especially concerning issues of jurisdiction and choice of law. She is widely considered a leading expert on the interpretation and application of Rome II. Katherine contributed to the APIL Guide to Accidents Abroad and frequently gives talks on areas of interest in the fields of travel or personal injury law.
Interviewed by Kate Beaumont. The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.
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