Jacobs v Motor Insurers Bureau

Where UK regulations require the MIB to compensate a UK resident injured abroad by an unidentified or uninsured vehicle, the statutory fiction that the accident occurred in Great Britain defines the MIB’s obligation. It is not a conflicts-of-laws rule. The claim is not no-fault: the claimant must establish the driver’s liability under the applicable conflicts rules, normally the law of the country where the accident occurred. Liability and assessment of damages are separate issues. Once entitlement is established, regulation 13(2)(b) requires compensation to be assessed as if the accident had occurred in Great Britain, so English law governs the assessment. Rome II does not displace that result because it does not govern the statutory measure of compensation payable by the MIB.

Mr Clinton David Jacobs, a UK resident, was injured in Spain by a car driven by a German national. No insurer could be identified. It was common ground that he could claim compensation from the Motor Insurers Bureau under the Motor Vehicles (Compulsory Insurance) (Information Centre and Compensation Body) Regulations 2003.

Owen J held that Rome II required compensation to be assessed under Spanish law and rejected reliance on the common-habitual-residence exception in Article 4(2). On appeal, the central question was whether regulation 13 required assessment under English law or Spanish law.

The Court of Appeal allowed the appeal. Moore-Bick LJ gave the judgment, with Laws and Rimer LJJ agreeing. The MIB was obliged to pay compensation assessed in accordance with English law.

1. The Fourth Motor Insurance Directive establishes compensation bodies as a safety net for cases involving unidentified or uninsured vehicles. The scheme does not ultimately place the loss on the domestic compensation body, but the Directive does not prescribe a single law governing liability and damages at every stage.
2. A claim under regulation 13 derives from the 2003 Regulations and is free-standing as a statutory claim. It nevertheless contains an implicit requirement that the claimant establish liability on the part of the driver. The scheme does not create no-fault compensation. Whether proof of fault is required depends on the law applicable under the relevant conflicts rules, normally the law of the country where the accident occurred. This was consistent with the equivalent protection required by the European Court in Evans v Secretary of State for the Environment, Transport and the Regions & Motor Insurers’ Bureau [2003] ECR I-14447.
3. Different legal systems may govern different questions arising from the same claim. Assessment of damages is a separate issue from liability, as illustrated by Macmillan Ltd v Bishopsgate Investment Trust Plc (No. 3) [1996] 1 W.L.R. 387. Regulation 12 showed that compensation for an insured driver could be assessed under the law applying in the claimant’s part of the United Kingdom.
4. The words in regulation 13(2)(b) requiring the MIB to compensate the claimant as if the accident had occurred in Great Britain extend to the assessment of damages. They define the existence and extent of the MIB’s statutory obligation rather than determine the wrongdoer’s liability. Accordingly, regulation 13(2)(b) is not a choice-of-law clause and Rome II has no application to the assessment of compensation under it.
5. The more favourable domestic protection permitted by Article 10(4) of the Fourth Motor Insurance Directive supported that construction. It was unnecessary to consider the supremacy principles discussed by the judge, including Amministrazione delle Finanz dello Stato v Simmenthal S.p.A. [1978] E.C.R. 629.

• Court of Appeal (Civil Division): The appeal was allowed. The MIB was held obliged to assess compensation under English law: [2010] EWCA Civ 1208.
• High Court of Justice, Queen’s Bench Division: Owen J held that Rome II applied and that compensation was to be assessed under Spanish law: [2010] EWHC 231 (QB).