ECJ asked to help establish liability over road crash payment

The Supreme Court has asked the European Court of Justice to decide key issues to establish liability for compensation paid out to a woman injured in a road incident.

The ECJ ruling will have implications for dozens of other cases.

The issue arises following a previous determination by the ECJ that Ireland had failed to properly transpose into national law, and within time, the provisions of a 1990 directive - the Third Directive - requiring that all passengers in motor vehicles should be covered by the insurance of the driver of that vehicle.

The decision of the ECJ on the latest issue referred to it will ultimately determine whether the State or the Motor Insurers Bureau of Ireland (MIBI) is liable for compensation which it was agreed should be paid to a woman injured in January 1996 when a van in which she was a rear seat passenger crashed into a wall.

Not disclosed

The amount of compensation paid has not been disclosed, the Supreme Court noted.

While it was accepted the incident was the fault of the van driver, he was not insured for injury to the woman in circumstances where, in Ireland in 1996, drivers were not obliged to insure against injury to passengers who were seated, as the woman was, on the floor of a van not fitted with seats, Mr Justice Peter Charleton noted.

Arising from Ireland’s failure to transpose the Third Directive properly, it was decided to pay compensation to the woman while legal proceedings commenced to decide whether the MIBI or State is liable for the sum paid.

That decision depends on whether the MIBI is an “emanation” of the State.

The MIBI was set up to deal with claims under the EU Directive concerning persons injured in circumstances where the driver is both uninsured and unable to compensate the injured person out of their own resources, or cannot be identified.

In the proceedings, the State argues, should it be found liable for the compensation paid to the woman, then the MIBI should pay the damages as an “emanation” of Ireland.

After the High Court ruled the MIBI is an emanation of Ireland, the MIBI appealed that decision to the Supreme Court.

‘Special responsibilities’

In its appeal, the MIBI accepts it has “special responsibilities” under the EU Directive but argues this cannot be equated with “special powers”.

The MIBI argues it has no such powers and all of its responsibilities arise under a contract with the Minister for the Environment.

It argues it is wrong for the MIBI to be retrospectively saddled with liabilities that do not arise under policies of motor insurance and rather arise from failure of the State to transpose a Directive properly.

On Tuesday, the three-judge Supreme Court, comprising Mr Justice Charleton, Mr Justice Frank Clarke and Ms Justice Mary Laffoy, agreed to refer issues arising in the appeal for determination by the ECJ.

Those issues relate to the applicability of the appropriate legal test for determining what is an emanation of a member state.

The ECJ is also asked to decide whether a body can be determined to be an emanation of a member state solely on the basis that a broad measure of responsibility has been transferred to it for the ostensible purpose of meeting obligations under EU law, or whether such a body must also have “special powers” or operate under the direct control or supervision of the member state.