The position of the assured

The Court of Justice of the European Union has, in joined cases Churchill Insurance Co Ltd v Wilkinson; Evans v Equity Claims Ltd Case C-442/10, 1 December 2011, upheld the view of the Court of Appeal that the effect of the Consolidated Motor Insurance Directive, European Parliament and Council Directive 2009/103/ EC and s151(8) of the Road Traffic Act 1988 is not to allow an insurer to deny liability where the assured himself suffers personal injury while being driven in his own vehicle by an uninsured driver.

Wilkinson and Evans: the facts

Mr Wilkinson’s mother was insured by Churchill under a policy which covered Mr Wilkinson’s use of the vehicle. On 23 November 2005 he gave permission to a friend to drive the vehicle. The friend was not covered by that policy or indeed any other, and Mr Wilkinson was aware of that fact. The driver was involved in a collision and Mr Wilkinson was severely injured. There was no dispute as to the driver’s liability. Churchill was on the face of things obliged to make payment to Mr Wilkinson under s151 of the Road Traffic Act 1988, as he had obtained a judgment in respect of liability arising from the use of a motor vehicle on a road. However, Churchill relied upon s151(8). This provides that an insurer who makes payment under s151 is entitled to recover its payment from the assured if the vehicle was being driven by an uninsured person but with the consent of the assured. This provision is aimed primarily at the situation in which the uninsured driver has injured a third party: that third party is entitled to recover from the insurers, but the insurers are entitled to recover their payment either from the uninsured driver or from the assured himself if he permitted the third party to drive without insurance. The novelty in Wilkinson was the use of s151(8) where the assured was himself the victim. Churchill’s case was that it was required to pay Mr Wilkinson but at the same time had the right to recover its payment under s151(8), so the net effect was that nothing was due to him.