MIBI to challenge costs ruling

THE MOTOR Insurance Bureau of Ireland (MIBI) has lodged an appeal against a High Court ruling that it must compensate a woman injured when a van driven by an uninsured driver crashed in 1996. The MIBI is taking the Supreme Court case to contest that it be held liable for all compensation costs.

On January 31st, Justice George Birmingham ruled that the MIBI was "an emanation of the State" and that as a result, Elaine Farrell - who was sitting on the rear floor at the time of the crash - was entitled to recover damages from it. Her sister Maire died in the crash.

The MIBI is expected to contest this view on the basis that it has been funded and operated separately from the State since it was established in 1955.

The appeal is seen as a test case for up to 50 similar pending legal claims involving uninsured drivers with an estimated settlement cost of €15 million.

Through the appeal, the requirement of whether the State must meet part of the cost of compensating those involved in a crash with an uninsured motorist should be resolved.

The case originates from a claim by Ms Farrell in 1997 when she obtained a judgment against the driver. However, the Government and the MIBI declined to pay compensation because she was sitting on the floor in the back of a vehicle not fitted with seating.

Ms Farrell then took the case to the Court of Justice (ECJ) which ruled last April that she was entitled to compensation in the Irish courts.

Under a 1990 EU directive on insurance and civil liability, all EU states are obliged to ensure that insurance covers liability for personal injuries to all passengers, excluding the driver.

The MIBI was set up in 1955 to provide compensation to victims of crashes caused by uninsured and unidentified vehicles. It is funded by motor insurers who pass these costs on to motorists, adding around €45 per year to each policy. Its board is made up of representatives of the motor insurance sector.

After the High Court ruling in February, Minister for Transport Noel Dempsey criticised the MIBI for the delay in compensating the claimant.

Saying that the MIBI appeared to have lost sight of the victims and their families, Mr Dempsey called on the bureau to settle this and other outstanding similar cases quickly. No date has yet been set for the appeal.

When contacted last night, MIBI chief executive John Casey declined to comment.