Delaney v Pickett & Anor

A passenger’s participation in a criminal enterprise does not bar a negligence claim where the criminal activity merely provides the occasion for the accident. The defence of illegality requires a relevant causal nexus between the claimant’s criminal conduct and the damage.

Under clause 6(1)(e)(iii) of the Motor Insurers’ Bureau Agreement, however, compensation is excluded where a passenger knowingly participates in a journey whose purpose is the acquisition and transportation of drugs for resale. On those facts, the vehicle is used in the course and furtherance of crime. The exclusion does not require the vehicle’s use to be a formal ingredient of the offence.

The appellant suffered grave injuries while travelling as a passenger in a car negligently driven by the first respondent. A large quantity of cannabis was concealed beneath the appellant’s coat. The trial judge inferred that the appellant and driver had embarked on a joint enterprise to acquire and transport cannabis for resale.

The County Court dismissed the negligence claim on grounds of illegality. It also dismissed the claim against the second respondent insurer under clause 6(1)(e)(iii) of the Motor Insurers’ Bureau Agreement, because the vehicle was being used in the course or furtherance of crime.

The issues were whether the trial judge’s factual inferences should stand, whether illegality defeated the negligence claim, and whether the insurer could rely on the Agreement’s exclusion.

1. By a majority, the appeal against the driver was allowed, but the appeal against the insurer was dismissed. Richards and Tomlinson LJJ upheld the trial judge’s inference that the appellant and driver had embarked on a joint enterprise to acquire and transport cannabis intended for resale. Ward LJ dissented on that factual issue and would have held that the insurer failed to prove more than simple possession.

2. The illegality defence did not defeat the claim against the driver. Applying Gray v Thames Trains Ltd [2009] UKHL 33, the relevant question was whether the criminal activity caused the appellant’s damage or merely provided the occasion for the driver’s tort. The injuries were caused by negligent driving, not by the acquisition or transportation of cannabis. There was no relevant nexus between the illegality and the tort, and the ordinary duty and standard of care remained ascertainable.

3. The majority held that clause 6(1)(e)(iii) of the Motor Insurers’ Bureau Agreement applied. The vehicle was used both in the course and furtherance of crime because the purpose of the journey was to acquire and transport a commercial quantity of cannabis for resale. Its use was an integral part of that enterprise. The exclusion did not require use of the vehicle to constitute a legal ingredient of the offence.

4. Richards LJ accepted that the exclusion should receive a restrictive interpretation and was prepared to recognise an implicit de minimis qualification. Possession with intent to supply a commercial quantity of cannabis was nevertheless sufficiently serious and fell squarely within the clause. Tomlinson LJ agreed that the clause applied, but expressed reservations about adding a de minimis gloss based on the seriousness of the crime.

5. The majority rejected Ward LJ’s view that the exclusion covered only crimes capable of supporting an illegality defence against the driver. That construction would deprive the clause of most practical effect. The European motor insurance directives provided little specific interpretative assistance because they contained no corresponding exclusion, and no challenge had been made to the clause’s compatibility with those directives.

6. The trial judge’s finding that the parties intended from the outset to acquire and transport the cannabis necessarily established the appellant’s knowledge before the journey began. The insurer therefore proved the knowledge required by clause 6(1)(e).

1. Court of Appeal (Civil Division): By a majority, allowed the appeal against the first respondent and entered judgment for the appellant, with damages to be assessed. Dismissed the appeal against the second respondent insurer.

2. County Court: His Honour Judge Gregory dismissed both claims. He held that illegality barred recovery against the driver and that clause 6(1)(e)(iii) of the Motor Insurers’ Bureau Agreement excluded recovery against the insurer.