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Bikelawyer wins High Court case extending the liability of motor insurers to innocent accident victims

Christopher Wastell –v- Gordon Woodward (Deceased) (1) & Chaucer Syndicates Ltd (2) [2017]

What were the facts?

In July 2012, Mr Woodward owned a hamburger van which he parked in a layby and traded from on a regular basis. After placing a sign advertising his burger van on the opposite side of the road, he stepped out into the road in order to cross back over to his van and collided with the Claimant’s motorcycle causing the Claimant very severe injuries.

The Claimant was travelling at 50mph. Mr Woodward was unable to see the Claimant as the Claimant was behind a passing car. No blame was attached to the Claimant. He could not have avoided the accident. Mr Woodward was sadly killed in the accident.

Mr Woodward and his Estate did not have any funds to meet the compensation claim nor did he have public liability insurance that would have covered commercial use of his van and any negligent acts committed arising from the use of that van as a burger business.

No compensation for life changing injuries?

Before instructing Bikelawyer in 2014, the Claimant was represented by 3 other law firms, all of whom told him he could not succeed with his claim, advice confirmed by a senior barrister instructed by the last firm. Those firms dropped the Claimant’s claim. Other law firms refused to take the case on for the same reason. They just could not see how the Claimant could get compensation.

How did Bikelawyer help?

After hearing the accident circumstances and knowing that there was no public liability insurance in place and that the Estate of the Deceased had no money, Bikelawyer saw a route to victory, albeit a most unusual one that was likely to be hotly disputed by Mr Woodward’s motor insurer. Bikelawyer agreed to act for the Claimant under a no-win, no-fee agreement, so at no risk to the Claimant should he lose.

A tough fight!

The case was indeed vigorously defended throughout. Liability was denied and the Defendant motor insurer argued that they were not liable to indemnify Mr Woodward’s actions as they had nothing to do with his use of the vehicle as a burger van. They said he should have had public liability insurance which he did not.

A trial took place in February 2017 at the Royal Courts of Justice in London. The High Court Master (Davison) found in favour of the Claimant. The Defendant sought permission to appeal which was granted. The Defendant’s solicitors dropped their barrister who was unsuccessful at the trial. They instructed a second barrister to prepare grounds of appeal and their legal argument in support.

Bikelawyer’s barrister, Mr Richard Furniss, who presented the winning arguments at trial,  prepared his response to the Appellant’s grounds of appeal and legal argument, a response so strong that the Defendant dropped their second barrister and appointed a third barrister, this time Jonathan Hough QC. The Appellant then made an application to the court to replace the grounds of appeal and legal argument with a substitute grounds of appeal and argument. This was allowed by the court. Bikelawyer responded with substitute grounds of appeal.

The appeal was listed to be heard in London commencing 22 November 2017.

2 weeks before the appeal hearing, the Appellant agreed to negotiate a settlement of the claim. After 3 years of litigation and more than 5 years after the accident, the case finally settled in November 2017, with the Claimant receiving a very substantial amount of compensation and with the Defendant having to pay his legal costs.

Why was the case successful?

Perhaps surprisingly, Bikelawyer advised the Claimant to bring a claim against Mr Woodward’s motor insurer.

Section 145(3) of the Road Traffic Act 1998 provides that compulsory motor insurance must insure the drivers named in the policy in respect of death or personal injury “caused by, or arising out of, the use of the vehicle on a road or other public place”.

The court was asked to consider whether the accident arose out of the use of a vehicle on the road and decided that it did.

The Law

In Dunthorne v Bentley & Another [1998] RTR 428 a similar question arose. The driver’s vehicle had run out of petrol and had come to a standstill at the side of the road. As the driver ran across the road to speak with a colleague and obtain petrol, she collided with a passing car. The court held section 145(3) was engaged as the purpose of the driver to cross the road was to receive help and petrol which would have enabled her to continue her journey in her motor vehicle.

The case established a list of principles for courts to consider when faced with the question of use.  This included that the purpose for which the vehicle was being used was relevant.

The commonwealth case of Government Insurance Office (NSW) v RJ Green & Lloyd Pty Ltd [1966] HCA 6 has been very influential in this area. Here the court said the nature of the particular vehicle must be considered in every case. This approach was affirmed in Vnuk v Zavarovalnica Triglav DD [2015] CJEU 142 where the court held that “use of vehicles” in article 3(1) of the First Motor Insurance Directive 72/166/EEC meant “any use of a vehicle that is consistent with the normal function of that vehicle”.

The Decision

The Claimant submitted this case was directly akin to Dunthorne as Mr Woodward had adjusted the business sign and was crossing back over the road to continue to use his hamburger van to produce and sell hamburgers.

Counsel for the Second Defendant submitted the motor vehicle was not being used as such and instead was being used as a stationary hamburger van with the purpose of selling burgers to passers-by. Furthermore the activity of placing and adjusting a business sign was a self-contained activity.

The Court held that the arguments were finely balanced, but resolved the issue in favour of the Claimant. The relevant question to determine is what is the relevant use of the vehicle on the road and then ask whether the accident arose out of that use.

Here the relevant use of the vehicle was as a hamburger van, and the act of adjusting a sign to help produce sales of hamburgers and the subsequent collision with the Claimant was closely linked to the relevant use.

The court held section 145(3) of the Road Traffic Act 1998 was engaged when the owner of a hamburger van walked into the path of an oncoming motorcyclist after stepping into the road having displayed a sign for the business. The accident was closely linked to ‘using the van on the road’ as a hamburger van.

The Defendants sought to argue that “use” of a vehicle required such vehicle to actually be in the process of being used as a vehicle; that is “use qua motor vehicle”. In other words, for locomotion. However the Road Traffic Act has no such qualification in it, so the Appeal court was effectively being asked by the Appellant to interpret the act as if it included use qua motor vehicle.

The court did state, for example and perhaps obviously, a person who sustained food poisoning from an undercooked burger from the van, or who tripped over the advertising sign, would not be able to pursue the motor insurer for compensation for injuries.

Helpfully, another case decided during the conduct of Bikelawyer’s case (UK Insurance Ltd –v- R & S Pilling [2017] EWCA Civ 259), also supported a wide definition of what constitutes “use” of a motor vehicle. That said, the Wastell facts are probably more controversial and closer to the line of acceptability as in the UK Insurance Ltd case a vehicle was actually physically involved, albeit it was being repaired, not driven.

Permission to appeal to the Supreme Court has been granted in the UK Insurance Ltd case so the argument about the line between what is and what is not “use” continues and insurers and Claimant lawyers will be watching this further development closely.

What does the Wastell case mean for Claimants?

The Dunthorne case established that “arising out of the use of” can be widely interpreted and does not mean “caused by”. The Wastell case has arguably further extended what can be considered an act arising out of the use of a vehicle and confirms that use need not be use as a vehicle, as in this case the purpose was as a hamburger van, as opposed to use as a vehicle for locomotion.

The fact that the Claimant’s 3 previous law firms failed to consider a claim against the motor insurer shows the importance of carefully thinking through accident circumstances and possible routes to victory.

This case is likely to result in Claimant lawyers attempting to bring more novel cases on behalf of clients where an act can be argued to arise from the use of a vehicle, in circumstances where the Defendant’s vehicle is not physically involved in the accident at all, but is merely one part of what can often be a complex chain of events. Sometimes all that is required is a little lateral thinking and novel application of the law to ensure the best possible results for clients. Bikelawyer is proud to take on difficult cases that other firms are either afraid to take on or don’t realise that there is a case to start with.

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