Francovich Damages Claim Fails

09/12/10

The High Court has dismissed a damages claim made against the Government for manifest and grave breach of EU law.  In what is known as a Francovich damages claim, Mrs Carswell argued that the costs paid to her by the Motor Insurers Bureau (MIB) following the death of her husband were inadequate and in breach of Directive 84/5/EEC (the Second Motor Insurance Directive).

Mr Carswell was seriously injured in a ‘hit and run' accident in the Euston Road, and died after some 18 months in a persistent vegetative state. Where a person is injured by an untraced driver, the MIB pays compensation and a contribution towards any legal costs. The claim included a root and branch attack on the inquisitorial system which is established by the 2003 Untraced Drivers Agreement between the Secretary of State and the MIB, and which constitutes the UK's implementation of the Second Motor Insurance Directive.

Francovich damages claims remain relatively unusual. Dismissing the submission that the UK system was in breach of EU law, Mr Justice Hickinbottom held that it is "... a commendably simple, sensible and proportionate costs scheme."

This judgment represents a significant victory for the UK, particularly as an earlier Francovich damages claim brought against another aspect of the system (the limitation rules) had succeeded (Byrne v Sec. of State for Transport and the MIB [2008] EWCA Civ 574).

The judgment is here.