Today the Supreme Court gave its judgment in the much awaited decision about whether a Claimant can issue a motor claim against an unknown and unidentifiable defendant, and then, in reliance of section 151 (2) (b) of the Road Traffic Act 1988, hold the motor insurer of the offending motor vehicle liable for loss and damage claimed.
In short, the answer is a resounding no!
In what can only be described as a victory for common sense, the Justices of the Supreme Court unanimously allowed the appeal by Liverpool Victoria Insurance, thereby overturning the decision of the Court of Appeal and reinstating the District Judge’s order whom had dismissed Ms Cameron’s application to substitute the Defendant Mr Hussain with “the persons unknown driving vehicle registration number Y598 SPS whom collided with vehicle registration number KG03 ZJZ on 26 may 2013”.
Lord Sumption gave the leading Judgment finding that in these circumstances Ms Cameron’s claim lay against the Motor Insurance Bureau (MIB), which had concluded 17,700 claims by victims of untraced drivers in 2017.
As to Ms Cameron’s choice to claim against Liverpool Victoria, (which Lord Sumption described as a hazardous route) this was rejected on the basis that in the circumstances, this offended the very basic rule of natural justice that a Defendant to legal proceedings is given sufficient notice of those proceedings and thus afforded the opportunity to defend himself if he so wished.
The result of this decision will undoubtedly be welcome news to motor liability insurers whom have seen an upsurge in such claim ever since the ruling of the Court of Appeal in May 2017.
Background to the case
On 26 May 2013, Ms Cameron was driving her Ford Fiesta when she was involved in a collision with a Nissan Micra, which failed to stop at the scene. Whilst the registration number was recorded and the matter subsequently reported to the police, the identity of the Nissan driver was never established.
It was common ground the driver of the Nissan was negligent and so Ms Cameron issued proceedings against the registered keeper, Mr. Hussain, holding him liable despite the fact he was not the driver at the time and he had been convicted for failing to disclose the driver’s identity.
Ms Cameron later added Liverpool Victoria Insurance to proceedings because it insured the Nissan was under a policy issued to a Mr Nissar Bahadur, although it was Liverpool Victoria’s subsequent belief that Mr Bahadur was a fictitious person.
Ms Cameron’s claim against Liverpool Victoria was for a declaration that it was liable to meet any judgment against Mr Hussain relying on section 151 (2) (b) of the Road Traffic Act 1988.
However, Ms Cameron later sought to substitute Mr Hussain because of Liverpool Victoria’s defence denying liability on the basis there was no right to obtain judgment against Mr Hussain because there was no evidence that he was the driver. This resulted in Ms Cameron’s legal team seeking to substitute Mr Hussain with “the persons unknown driving vehicle registration number Y598 SPS whom collided with vehicle registration number KG03 ZJZ on 26 may 2013”.
Summary of the findings of the Supreme Court
There is a general rule that proceedings may not be brought against unnamed parties save as for limited exceptions. Where those limited exceptions apply there is a key distinction between two classes of these unnamed parties, namely those whom are identifiable but whose names are not known (trespassers for example) and those whom are not identifiable and whose names are not known (such as hit and run drivers).
Under section 151 of the Road Traffic Act 1988, the insurer is only liable upon judgment obtained and there is no direct right of action as between a Claimant and the motor insurer.
In the present case, Ms Cameron sought to trigger Liverpool Victoria’s liability under section 151 of the Road Traffic Act 1988 by seeking to obtain judgment against an unknown person.
Not only was this case not held to be within the limited exceptions for allowing to proceed against an unnamed person, but to have allowed Ms Cameron to proceed in this manner would have offended the very basic principle that even an unnamed person (such as a squatter) has a right to be given notice of the proceedings (by service of the claim at the relevant address) and thus have the right to defend that action if he so wished.
Whilst Ms Cameron alleged injustice would be caused because any damages and costs paid out by the MIB would not be as much as she would be entitled if she could proceed against Liverpool Victoria, that point was rejected on the premise that whilst the point was not raised before the Court of Appeal, nevertheless, it was held that the MIB is consistent with the European Directive.
If you would like to know more about this matter, please speak to your contacts at Plexus Law:
Anthony Baker, Partner
T: 0113 4681 702 | M: 07811 545 321 | E: email@example.com
Danny Fulton, Head of Credit Hire Strategy
T: 0113 2229 065 | M: 07946 119 562 | E: firstname.lastname@example.org
Joseph’s Well | Hanover Walk | Leeds | LS3 1AB