Pepperall J made this observation in deciding a jurisdiction point arising from a road traffic accident in Germany (which took place before the end of the UK’s exit from the relevant EU regime). The claimant, domiciled in England, sued directly the Hungarian insurer of the negligent driver for the cost of repairs to his vehicle. Ordinarily, this would have been a small claim: his uninsured losses were limited to the policy excess of £350 and his motor insurer had paid a little less than £4,000 as the balance of the repair. His claim sought, unexceptionally, recovery of his excess and (by way of subrogation) the insurer’s spend. Generali (Hungary branch) disputed jurisdiction in England in respect of the subrogated outlay.
The decision turned on whether the subrogated claim fell within Article 11(1)(b) of the recast Brussels I regulation: “An insurer domiciled in a Member State may be sued … (b) in another Member State, in the case of actions brought by the policyholder, the insured or a beneficiary, in the courts for the place where the claimant is domiciled” or whether it was caught by Article 14: “an insurer may bring proceedings only in the courts of the Member State in which the defendant is domiciled.”
On the face of it, the claimant clearly was “a beneficiary” and therefore would appear to be able to establish jurisdiction in England. But did the existence of the subrogated repair claim, which would benefit his insurer (Admiral), in effect mean that the action was by the insurer such that only the Hungarian courts were competent?
The judge rejected the latter argument and the challenge to the jurisdiction. “On the clear wording of Article 11(1)(b), Mr Hill is entitled to sue Generali in the English courts.” But whether his right to do so would be tempered by the existence of the subrogated recovery of his insurer’s outlay was a point that had not been decided to date.
The recent CJEU cases on jurisdiction applying to insurer recoveries have tended to involve an insurer based in the EU taking an assignment from its insured and therefore acting in its own name, which is conceptually different from subrogation. Those cases do, however, establish that an insurer acting in that way in its own name is not a ‘weaker party’ for the purposes of the regulation and is therefore unable to take advantage of preferential rules of jurisdiction (such as in Article 11) that would benefit the directly injured party.
Nevertheless, the present case raised a slightly different question. The judge’s answer to that was clear and grounded in principle. His analysis is set out below.
“Mr Hill is the insured and the sole claimant in this case. The damage to his car is his loss and he is solely entitled, as a matter of English law, to sue for the diminution in value of his car even though Admiral has paid the bulk of the repair costs … Absent assignment, Admiral has no cause of action against Generali … the proper interpretation of the Regulation against its purpose and general scheme … point to an interpretation of the Regulation that allows the insured to sue for both insured and uninsured losses in the place of his or her domicile without the unnecessary procedural steps of assigning the insured losses and leaving the insurer to make an application for joinder.”
But would the positon be any different under the rules that apply now that the UK has replaced the Brussels I regulation with the common law and CPR ‘gateway’ approach recently clarified by the Supreme Court in Brownlie? [Our blog on that case is here].
The answer will depend on whether Mr Hill could be regarded as having suffered “damage” within this jurisdiction. Although he clearly paid his excess here, it might be argued that his “damage” arose once and for all at the time of the accident in Germany. However, the decision in Brownlie might tend to suggest that English courts would probably accept jurisdiction, but the point is hardly going to be tested in a modest value damage-only motor claim.
The judge in Hill noted that “the same answer to the subrogation issue must be given in the case of a claimant pursuing a substantial uninsured claim for catastrophic injuries while also seeking to recover a relatively modest insured claim for the written-off value of a car”. Although he was looking for that “same answer” in the context of subrogation and Brussels I, it seems to us that the rather different post-Brownlie rules on jurisdiction must surely yield their own “same answer” (which might be different to the Brussels I answer) in the case of subrogation. We just can’t as yet be entirely certain what that is.