Trethowans lawyer comments on Wall v Mutuelle in The Post magazine 27 March 2014

Author:

With the steady increase in cross-border movement that we have witnessed over time, insurers are facing more cases with jurisdictional issues than ever before.  The introduction of Council Regulation 864/2007 (known colloquially as “Rome II”) in January 2009 dramatically affected the assessment of damages in personal injury claims with a foreign element:  a claim for damages brought in an English Court is no longer assessed according to English Law.

Under Article 4(1) of Rome II the general principle is that the “applicable law” is the law of the country where the damage occurs.  Article 15(c) states that the applicable law will govern “the existence, the nature and the assessment of damage or the remedy claimed”, however, Article 1(3) of Rome II states that: “This Regulation shall not apply to evidence and procedure”.  Evidence and procedure therefore remains the realm of the law of the forum.

This tension between the law of the forum and the “applicable law” was revisited in the recent and long awaited appeal decision in the case of Steven Wall v Mutuelle de Poitiers Assurances (2014).

Mr Wall sustained serious injuries when the motorcycle he was riding in France was hit by a car driven by the Defendant’s insured.  Liability was not in dispute.  Quantum, likely to be substantial given the severity of injuries, certainly was in dispute.

The Claimant, with 8 expert witnesses lined up, contended that expert evidence should be determined by reference to the forum (England), on the basis that it was an issue of “evidence and procedure” under Article 1(3).  The Defendant insurance company contended that expert evidence should be determined by reference to the “applicable law”, being the law of the country in which the damage occurred under Article 4(1) (France).

The Lords were united in their view that Rome II could not envisage that the law of the place where the damage occurs should determine the way in which evidence of fact or opinion is delivered to the Court.  An English Court would be ill-equipped to receive expert evidence in the French manner, just as a French Court would be ill-equipped to address English-style expert evidence.

Upholding the decision of the lower Court, the Lords preferred the Claimant’s position that expert evidence is a question of “evidence and procedure” within Article 1(3) and found that the Court should follow its usual practice in relation to expert evidence.  Consequently the Court will establish the facts using English evidential practices, and will then assess damages in accordance with the “applicable law”.

The Lords’ decision on expert evidence is unlikely to be welcomed by insurers wishing to prevent the proliferation of medical reports often encountered in high value claims.  However, one would hope that this can be countered by the tougher approach to case management instigated by the Jackson Reforms, intended to promote efficiency and reduce litigation costs.

Since 1 April 2013 the Courts have far greater powers to restrict expert evidence, to specify the issues which the expert evidence should address, and even to limit the amount of experts’ fees that may be recovered from another party.  If effectively implemented, this should promote greater focus on identifying the issues that the proposed evidence will address, and keep a far tighter rein on the costs being incurred in relation to expert evidence.

Unfortunately this is unlikely to prevent “front loading” of expert evidence by Claimants, however if Jackson is to be robustly implemented then we may yet see an increase in pre-obtained expert evidence being disallowed post-proceedings.

In the context of Rome II, the Lords in Wall also took the opportunity to pass comment on the meaning of “applicable law” by which damages are to be assessed: is “law” to be construed narrowly, meaning legal rules which dictate a result, or should “law” be construed broadly, to include practices, conventions and guidelines?  The assessment of damages in England and Wales, for instance, is by reference to a number of tools (not just “laws”), including common law rules; decisions of the Court, and published guidelines such as those of the Judicial College or the Ogden tables.

The unanimous agreement from the Lords was that evidence should not be confined to rules which dictate a result, but rather should include “judicial conventions and practices” considered by the foreign Court in determining damages.  An English judge trying quantum, therefore, should have access to such as tariffs, guidelines or formulae that may be used by foreign judges in the calculation of damages under their applicable law.  Judges will doubtless have a discretion to depart from these guidelines if appropriate, but they should at least be regarded as an appropriate starting point to assess damages.

Whilst it is no doubt hoped that Rome II and the interpretation of its application in cases such as Wall will promote certainty and uniformity, claims with a foreign element inevitably present more complex issues.  The Court’s new found determination to insist upon compliance with deadlines will give rise to fresh concerns for those pursuing such claims, and there can be no room for complacency for insurance practitioners.  The focus for lawyers will be on achieving a timetable that can be confidently adhered to at the outset, and ensuring that the insurer’s position remains best protected notwithstanding the jurisdictional issues.

This article was written by Bethany Blamire, Associate with Trethowans LLP. For more information contact bethany.blamire@trethowans.com