Wylie v Wake

For an insurer to avoid liability under Road Traffic Act 1988, section 152(1)(a), notice must concern the bringing of proceedings, rather than merely the making of a claim. Notice may be oral, may precede commencement, and need not identify the precise proceedings or court. Whether sufficient notice was given is a matter of fact and degree. A conditional warning may be insufficient, unless the condition depends on action which the recipient chooses not to take. The statutory notice is a condition precedent to liability, not merely a procedural defence. An insurer’s conduct while defending the insured does not, without a representation capable of supporting estoppel, waive the right to rely on the statutory condition.

The claimant was injured as a passenger in a road accident caused by the first defendant, who was uninsured under the relevant policy. The appellant insurer had been notified of the claim and subsequently participated in the litigation, but was not expressly notified of the issuing of the writ before or within seven days after commencement.

The insurer was joined as second defendant and sought a declaration under section 152(1)(a) of the Road Traffic Act 1988. The county court held that the insurer had received adequate notice and rejected the statutory objection. The central issues on appeal were whether the insurer had notice of the bringing of the proceedings and, if not, whether its conduct gave rise to waiver or estoppel.

1. Appeal allowed. The declaration sought by the second defendant was made. The insurer was not liable under section 151 because the statutory notice required by section 152(1)(a) had not been given.
2. The expression “notice of the bringing of the proceedings” requires more than notice that a claim is being made. The distinction is legally material. The notice may be oral or written, may come from someone other than the claimant, and may be given before proceedings commence. It need not specify the precise nature of the proceedings or the court.
3. Whether the insurer had the required notice is a matter of fact and degree. A notification conditional on an event which may or may not occur is insufficient. Where the only condition requires action by the insurer and the insurer elects not to act, the notice may become effective.
4. The purpose of the notice requirement is to prevent the insurer from being faced unexpectedly with a judgment which it must satisfy without having had an opportunity to participate in the proceedings. That purpose does not permit the statutory condition precedent to be ignored, even where the insurer was kept informed of the claim and litigation.
5. Section 152(1)(a) is not merely a statutory defence. It prescribes a state of affairs which must exist before the insurer becomes liable. The insurer could therefore defend the action on behalf of the insured and later rely on the absence of notice when liability under section 151 was invoked.
6. There was no waiver or estoppel. The insurer had made no relevant representation, and its conduct while acting for the insured did not waive points available against a future claim against the insurer. The unattractive delay in taking the point could not determine the legal outcome.

• Court of Appeal (Civil Division): Appeal from the order of H.H. Judge Thompson QC, sitting at Southampton County Court, dated 24 March 2000. Appeal allowed and declaration made.