Time limits

Byrne v Motor Insurers’ Bureau [2007] EWHC 1268 (QB) the victim of a hit-and-run driver asserted that the three-year limitation period imposed upon him by the Motor Insurers’ Bureau’s Untraced Drivers Agreement of 1972 did not comply with the EU’s Second Motor Insurance Directive, Council Directive 84/5/EEC and could not be enforced. The matters coming before Flaux J were preliminary issues on assumed facts. As will be seen below, Flaux J held that the UK was in breach of the Directive and that it was arguable that the default gave rise to damages.

The facts

On 21 June 1993 B, then aged three, was injured in a hit-and-run accident. His parents did not obtain legal advice and were unaware of the possibility of a claim against the Motor Insurers’ Bureau (MIB) under the then current Untraced Drivers Agreement, that of 1972. As is well known, the 1972 Agreement and its successors require the MIB to pay to the victim the sum which he would have been likely to have been awarded had the driver been identified and successfully sued. The Agreement required any claim against the MIB to be brought within three years of the incident. However, because of the absence of legal advice, no claim was made against the MIB at that time, and indeed this possibility was not known by B’s parents until October 2001. A claim was duly made in December 2001, but this was rejected in reliance on the three-year time limit. The Agreement provided for arbitration in the event of a dispute as to a ruling by the MIB, but B’s parents did not take up that option. Instead, B commenced an action in March 2006 against the MIB, alleging that the 1972 Agreement should be construed consistently with art 1(4) of the EC’s Second Motor Insurance Directive which requires compensation to be paid to the victim of a hit-and-run driver so that the time-limit could not apply. In the alternative B argued that the MIB could not rely upon the 1972 Agreement insofar as it was inconsistent with the Directive. If B could not succeed against the MIB on either of those grounds, B asserted that the Secretary of State had failed to implement the Directives properly and was liable in damages.