Personal injury update

Personal injury update:
changes to the Untraced Drivers’ Agreement

Judy Dawson explains when an application needs to be made under the new agreement, which applies to accidents that occur on or after 1 March 2017.

About the author
Judy Dawson is a barrister at Park Square Barristers, Leeds. She specialises in questions of insurance indemnity.

If an injured person cannot identify the atfault driver of another vehicle, the Untraced Drivers’ Agreement governs their rights to compensation.¹ In many instances, this is because the accident was a classic ‘hit and run’ ; indeed, the Motor Insurers’ Bureau (MIB) has stated that 12% of accidents in which the collision was reported to the police and a person was injured were such ‘hit-and-run accidents’.² (This statistic is not as significant as it would seem at first blush: most relatively minor road traffic accidents are not reported to police. The reason that such accidents are reported is that the other vehicle has made off without stopping so, to a certain extent, it is a self-selecting criteria). No details of the at-fault vehicle or the driver tend to have been obtained or recorded, so an injured person’s only option would be the Untraced Drivers’ Agreement.

More difficulties seem to arise where the injured person either knows the identity of the vehicle but not the driver, or thinks that they know the identity of the driver. In the former instance, the first port of call is usually the insurer of the vehicle. It is a common mistake to assume that the adage: ‘It is the car that is insured, not the person’, which governs contingent liability under the Road Traffic Act (RTA) 1988, means that once a vehicle is identified, litigation against the insurance company will be successful.

The adage applies to the position where an insurer insures a policyholder (P) for their use of car X. It does not insure P’s teenage son under the policy. If P’s teenage son drives car X uninsured and negligently injures the claimant (C), that C can obtain judgment against P’s teenage son. Under the RTA, the insurer must satisfy this judgment if it remains unsatisfied for seven days (the insurer may thereafter have a cause of action against either P or their son, but C cares little – they have their money).

However, such liability is only a contingent liability to satisfy a judgment. If car X is stolen and a car thief (CT) crashes into Ms C injuring her but, unfortunately, in the process CT is trapped in the stolen vehicle and, therefore, extricated in time to be arrested, Ms C can obtain judgment against CT and the insurer must satisfy the judgment. However, if CT manages to abandon the stolen vehicle after crashing into Ms C, and disappears before the police arrives, Ms C has nobody against whom to bring proceedings to obtain a judgment and, therefore, cannot get compensation from the insurer.

If an injured person cannot identify the atfault driver of another vehicle, the Untraced Drivers’ Agreement governs their rights to compensation

Similarly, if there is a hit and run but a claimant manages to get details of the vehicle, they still must ascertain, on the balance of probabilities, who was the driver of the vehicle at the time. This can prove difficult evidentially, for example, if Mr Liar (L) is the registered keeper of the vehicle and is the sole insured, and admits that he is the only person with access to the keys, a bare denial by him that he ever had such an accident is unlikely to be believed. However, if the registered keeper is one person and there are multiple people insured on the vehicle, and there is not even a partial description of the driver, it makes it difficult for a claimant to prove the identity of the driver.

The author has heard arguments that the court can presume that the registered keeper/insured was the driver; nevertheless, in a hit-and-run accident, there is at least a suspicion that the fact that the driver was not the insured person was the reason for the failure to stop.

It becomes more complex when details are provided at the scene which, subsequently, transpire were or may have been incorrect. Claimants often issue proceedings against an alleged driver, assuming that they will obtain judgment with relative ease (such judgment falling to be satisfied by the insurer), as the driver had not been traced by the insurer and, seemingly, the claim cannot be defended. If doubts about the driver’s identity are raised successfully, then judgment cannot be obtained and the claimant cannot obtain compensation through the courts.

Some claimants’ representatives have sought to bypass this difficulty (and the difficulty of service on a defendant who cannot be traced) by issuing proceedings under the European Communities (Rights against Insurers) Regulations (‘ Rights against Insurers Regs’ ) 2002 SI No 3061 directly against the insurer. This approach is misconceived, as to succeed against the insurer, a claimant must prove that an insured person was driving; if the driver’s identity is unknown, then a claimant cannot establish liability.

The European question

It has been argued by some legal representatives that the RTA and the Rights against Insurers Regs should be read in conjunction and/or interpreted to give effect to the various European directives that national law should ensure that victims of motor accidents are compensated, irrespective of the insurance status of the driver. The author would contend that such arguments are misconceived, as the existence of the Untraced Drivers’ Agreement (and the Uninsured Drivers’ Agreements) ensure that compensation is open to victims so that there is no need for a strangulated interpretation of legislation to achieve this aim (and further, in any event, the legislation is so clear that it cannot be interpreted to give such effect).³

Costs, procedure and limitation

There has been a traditional distrust, and avoidance, of proceeding under the Untraced Drivers’ Agreement. The author suspects that this is due, largely, to the costs provisions. These are set out in Part 4 of the agreement, and they make the fixed recoverable costs regime seem remarkably generous.

The fee for a claim for not more than £10,000 is £450 + VAT plus reasonable disbursements, rising to, for claims between £10,000 and £25,000, a heady £700 + VAT plus reasonable disbursements. If the claim goes to an arbitrator, then a claimant is entitled to additional reasonable legal costs, with the proviso that the claim would have been dealt with via the fast track had it been brought against an identified person by way of court proceedings. Such costs are limited to a further £500 + VAT, where the original decision of the arbitrator is not accepted, plus either £250 + VAT, where the subsequent arbitration is by written observations, or £500 + VAT where the subsequent arbitration goes to an oral hearing.

The MIB will investigate the claim, and then can either refuse the claim or make an offer. A refusal to accept the same, or an appeal on a refusal to pay, will lead to a decision by an arbitrator which, if not accepted, is followed by a hearing by an arbitrator (a QC selected from an appointed panel).

The new Untraced Drivers’ Agreement introduces a system of approval of a settlement for an infant or incapacitated person. The limitation periods follow the Limitation Act 1980 (ie, three years for personal injury) while originally the previous agreement had a shorter limitation period (ie, two years). This had been amended subsequently, so that the new agreement does not change the law.

As with the Uninsured Drivers’ Agreement, there is only a liability on the MIB if there are no other persons from whom to recover. For instance, a passenger in a vehicle, who is injured due to 90% negligence of an unidentified driver, but also due to 10% negligence of the driver of the insured vehicle in which they were travelling, is entitled to claim for the full amount from the latter driver (and their insurer) and, therefore, will not be entitled to an award under the new agreement.

Property damage

Property damage was excluded originally from the previous Untraced Drivers’ Agreement. There have been incremental amendments to this and, in addition, a gradual corrosion of the principles such that it is possible to make a property damage claim (usually a claim for the vehicle) in the following narrow circumstances:

The author does not fully agree with the rationale of this approach. If an unidentified driver wiped out my vehicle, which was insured on a third party, fire and theft basis, as it was parked outside my house, why should I receive property damage compensation only if my husband happened to be sitting inside the car at the time and suffered a whiplash injury necessitating physiotherapy, but no such compensation if it was unattended? In both scenarios, I have lost my vehicle through no fault of my own.

For completeness, ‘significant personal injury’ means death, or injury necessitating two nights’ or more of hospital inpatient treatment, or three sessions or more of hospital outpatient treatment. Despite considerable opposition from the MIB, persons whose vehicles were uninsured are entitled to recovery if they meet the other criteria.

Passengers

There is a detailed exception to the liability of the MIB for passengers travelling in the at-fault vehicle, who knew that it was stolen or that the driver was uninsured at the time. On first blush, it seems a sensible exception, mirroring that contained within the Uninsured Drivers’ Agreement. It is only when one takes a step back that one realises how little the exception will be used. The new agreement relates to ‘unidentified persons’ (ie, a person who is, or appears to be, wholly or partly liable in respect of the claim and who cannot be identified). One has to wonder how many passengers injured in road traffic accidents were unaware of the identity of the driver of the vehicle in which they were travelling at the time (albeit, one supposes, that the provision does catch those passengers who may refuse to reveal the name of the driver in order to shield that person from potential criminal prosecution). This exception is strengthened by the fact that having placed the burden of proof on the MIB in establishing that the passenger knew the vehicle was stolen or the driver was uninsured at the time, the following clause goes on to state that the claimant will be deemed to have had such knowledge, subject to evidence to the contrary, if the MIB can establish that the claimant was:

It seems a trifle unlikely that a scenario would arise where a passenger would not know the identity of the driver of the vehicle, but would know that they were disqualified from driving!

The new agreement makes one significant change to correct what was probably misdrafting in the previous agreements. In claims brought by dependants, contributory negligence by the deceased is taken into account in deciding whether awards should be reduced.

The previous agreements referred to ‘the claimant’s contributory negligence’, such that in cases where the claimants were in fact the dependants, no reduction could be made for the contributory negligence of the deceased. The author had a case where the deceased had gone for a ride, as pillion passenger, on a motorcycle without a helmet, and subsequently died from the injuries she sustained when thrown off. This was a case under an Uninsured Drivers’ Agreement which used the earlier wording. The dependancy claim by her children could not be reduced due to her negligence in failing to wear a helmet; however, under the new agreement wording it would have been. This is likely to arise in both seatbelt cases and where the passenger knew, or ought to have known, that the driver was driving with excess alcohol.

Other changes

The arbitrator now has power to order a claimant to contribute to the costs of the arbitration proceedings in certain circumstances. However, the MIB cannot ask for a lower award at an arbitration hearing than it offered originally; it must stick to the original offer. While this may seem to make an appeal a no-lose scenario for an unrepresented claimant, the first sentence of this paragraph redresses the balance.

 

1 MIB has an agreement for each of the countries within which it operates. There have been various agreements over time, which apply depending on the date when the accident occurred. All the agreements are available at: http://tinyurl.com/k46sh3h. The most recent agreement for England, Scotland and Wales applies to accidents on or after 1 March 2017, available at: http://tinyurl.com/kpf4f2e
2 Matt Hopkins, Sally Chivers and Gail Stevenson-Freer, Hit-and-run : why do drivers fail to stop after an accident? Contexts of incidents, driver motivations and preventative strategies, available at: http://tinyurl.com/m2pgncr
3 MIB has an agreement for each of the countries within which it operates. There have been various agreements over time, which apply depending on the date when the accident occurred. The most recent agreement for England, Scotland and Wales applies to accidents on or after 1 August 2015. All the agreements are available at: http://tinyurl.com/kxb2jdu

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