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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Churchill Insurance Company Limited v Benjamin Wilkinson and Tracy Evans v Equity Claims Limited (Judgment of the Court (Fourth Chamber)) [2011] EUECJ C-442/10 (1 December 2011)
URL: http://www.bailii.org/eu/cases/EUECJ/2011/C44210.html
Cite as: ECLI:EU:C:2011:799, EU:C:2011:799, [2011] EUECJ C-442/10
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Case C-442/10
Churchill Insurance Company Limited
v
Benjamin Wilkinson
and
Tracy Evans
v
Equity Claims Limited
(Reference for a preliminary ruling from the
Court of Appeal (England and Wales) (Civil Division))
(Compulsory insurance against civil liability in respect of the use of motor vehicles – Directive 84/5/EEC – Article 1(4) and Article 2(1) – Third parties victims of an accident – Express or implied authorisation to drive – Directive 90/232/EEC – First paragraph of Article 1 – Directive 2009/103/EC – Articles 10, 12(1) and 13(1) – Victim of a road traffic accident who was a passenger in a vehicle in respect of which he was insured to drive – Vehicle driven by a person not insured under the insurance policy – Insured victim not deprived of insurance cover)
Summary of the Judgment
Approximation of laws – Insurance against civil liability in respect of motor vehicles – Extent of cover for third parties under compulsory insurance – Exclusion clauses – Accident caused by an uninsured driver
(Council Directives 72/166, 84/5, Art. 2(1), and 90/232, Art. 1, first para.)
The first paragraph of Article 1 of Third Directive 90/232 and Article 2(1) of Second Directive 84/5 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles must be interpreted as precluding national rules the effect of which is to exclude automatically the requirement for the insurer to compensate a passenger who is a victim of a road traffic accident when that accident was caused by a driver who was not insured under the insurance policy and when the victim, who was a passenger in the vehicle at the time of the accident, was insured to drive the vehicle himself and had given permission to the driver to drive it.
That interpretation does not differ depending on whether the insured victim was aware that the person to whom he gave permission to drive the vehicle was not insured to do so, whether he believed that the driver was insured or whether or not he had turned his mind to that question.
The insurance against civil liability in respect of the use of motor vehicles referred to in Article 3(1) of First Directive 72/166 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles must cover all the victims other than the driver of the vehicle that caused the damage or injury, unless one of the exceptions expressly provided for by the First, Second or Third Directives applies.
(see paras 44, 46, 50, operative part 1-2)
JUDGMENT OF THE COURT (Fourth Chamber)
1 December 2011 (*)
(Compulsory insurance against civil liability in respect of the use of motor vehicles – Directive 84/5/EEC –Article 1(4) and Article 2(1) – Third parties victims of an accident – Express or implied authorisation to drive – Directive 90/232/EEC – First subparagraph of Article 1 – Directive 2009/103/EC – Articles 10, 12(1) and 13(1) – Victim of a road traffic accident who was a passenger in a vehicle in respect of which he was insured to drive – Vehicle driven by a person not insured under the insurance policy – Insured victim not deprived of insurance cover)
In Case C‑442/10,
REFERENCE for a preliminary ruling under Article 267 TFEU from the Court of Appeal (England and Wales) (Civil Division) (United Kingdom), made by decision of 26 August 2010, received at the Court on 13 September 2010, in the proceedings
Churchill Insurance Company Limited
v
Benjamin Wilkinson,
and
Tracy Evans
v
Equity Claims Limited,
THE COURT (Fourth Chamber),
composed of J.-C. Bonichot, President of the Chamber, A. Prechal, L. Bay Larsen, C. Toader and E. Jarašiūnas (Rapporteur), Judges,
Advocate General: P. Mengozzi,
Registrar: R. Şereş, Administrator,
having regard to the written procedure and further to the hearing on 7 July 2011,
after considering the observations submitted on behalf of:
– Churchill Insurance Company Limited, by F. Randolph, Barrister, and S. Worthington QC,
– Mr Wilkinson, by C. Quigley and S. Grime QC,
– Mrs Evans, by G. Wood and C. Quigley QC,
– Equity Claims Limited, by W.R.O. Hunter QC, instructed by J. Herzog, Solicitor,
– the United Kingdom Government, by L. Seeboruth, acting as Agent,
– the European Commission, by K.-P. Wojcik and N. Yerrell, acting as Agents,
after hearing the Opinion of the Advocate General at the sitting on 6 September 2011,
gives the following
Judgment
1 This reference for a preliminary ruling concerns the interpretation of Articles 12(1) and 13(1) of Directive 2009/103/EC of the European Parliament and of the Council of 16 September 2009 relating to insurance against civil liability in respect of the use of motor vehicles, and the enforcement of the obligation to insure against such liability (OJ 2009 L 263, p. 11).
2 The reference has been made in proceedings between, first, Churchill Insurance Company Limited (‘Churchill’) and Mr Wilkinson, and, second, Mrs Evans and Equity Claims Limited (‘Equity’) concerning compensation for damage or injury suffered in respect of road traffic accidents.
Legal context
European Union (‘EU’) Law
3 Pursuant to Article 3(1) of Council Directive 72/166/EEC of 24 April 1972 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles, and to the enforcement of the obligation to insure against such liability (OJ, English Special Edition 1972 (II), p. 360) (‘the First Directive’):
‘Each Member State shall … take all appropriate measures to ensure that civil liability in respect of the use of vehicles normally based in its territory is covered by insurance. The extent of the liability covered and the terms and conditions of the cover shall be determined on the basis of these measures.’
4 Recitals 6 to 8 in the preamble to Second Council Directive 84/5/EEC of 30 December 1983 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles (OJ 1984 L 8, p. 17) (‘the Second Directive’), state:
‘… it is necessary to make provision for a body to guarantee that the victim will not remain without compensation where the vehicle which caused the accident is uninsured or unidentified; whereas it is important, without amending the provisions applied by the Member States with regard to the subsidiary or non‑subsidiary nature of the compensation paid by that body and to the rules applicable with regard to subrogation, to provide that the victim of such an accident should be able to apply directly to that body as a first point of contact; whereas, however, Member States should be given the possibility of applying certain limited exclusions as regards the payment of compensation by that body and of providing that compensation for damage to property caused by an unidentified vehicle may be limited or excluded in view of the danger of fraud;
… it is in the interest of victims that the effects of certain exclusion clauses be limited to the relationship between the insurer and the person responsible for the accident; whereas, however, in the case of vehicles stolen or obtained by violence, Member States may specify that compensation will be payable by the abovementioned body;
… in order to alleviate the financial burden on that body, Member States may make provision for the application of certain excesses where the body provides compensation for damage to property caused by uninsured vehicles or, where appropriate, vehicles stolen or obtained by violence’.
5 Article 1(4) of the Second Directive provides that each Member State is to set up or authorise a body with the object of providing compensation, at least up to the limits of the insurance obligation, for damage to property or personal injuries caused by an unidentified or uninsured vehicle (‘the national body’). The third subparagraph of Article 1(4) states:
‘… Member States may exclude the payment of compensation by that body in respect of persons who voluntarily entered the vehicle which caused the damage or injury when the body can prove that they knew it was uninsured.’
6 In accordance with the fourth subparagraph of Article 1(4), Member States may limit or exclude the payment of compensation by that body in the event of damage to property by an unidentified vehicle and, in accordance with the fifth subparagraph of that provision, they may also authorise, in the case of damage to property caused by an uninsured vehicle an excess of not more than EUR 500 for which the victim may be responsible.
7 The rules applicable to those national bodies were subsequently clarified and supplemented by, in particular, Directive 2005/14/EC of the European Parliament and of the Council of 11 May 2005 amending Council Directives 72/166/EEC, 84/5/EEC, 88/357/EEC and 90/232/EEC and Directive 2000/26/EC of the European Parliament and of the Council relating to insurance against civil liability in respect of the use of motor vehicles (OJ 2005 L 149, p. 14). The third subparagraph of Article 1(4) of the Second Directive therefore became, in essence, the second subparagraph of Article 1(5) of the Second Directive, as amended by Directive 2005/14.
8 Article 2(1) of the Second Directive provides:
‘Each Member State shall take the necessary measures to ensure that any statutory provision or any contractual clause contained in an insurance policy issued in accordance with Article 3(1) of [the first Directive], which excludes from insurance the use or driving of vehicles by:
– persons who do not have express or implied authorisation thereto, or
– persons who do not hold a licence permitting them to drive the vehicle concerned, or
– persons who are in breach of the statutory technical requirements concerning the condition and safety of the vehicle concerned,
shall, for the purposes of Article 3(1) of [the First Directive], be deemed to be void in respect of claims by third parties who have been victims of an accident.
However the provision or clause referred to in the first indent may be invoked against persons who voluntarily entered the vehicle which caused the damage or injury, when the insurer can prove that they knew the vehicle was stolen.
…’
9 According to recitals 4 and 5 in the preamble to Third Council Directive 90/232/EEC of 14 May 1990 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles (OJ 1990 L 129, p. 33) (‘the Third Directive’):
‘… motor vehicle accident victims should be guaranteed comparable treatment irrespective of where in the Community accidents occur;
… there are, in particular, gaps in the compulsory insurance cover of motor vehicle passengers in certain Member States; whereas, to protect this particularly vulnerable category of potential victims, such gaps should be filled’.
10 Article 1, first paragraph, of the Third Directive provides:
‘Without prejudice to the second subparagraph of Article 2(1) of [the Second Directive], the insurance referred to in Article 3(1) of the [First Directive] shall cover liability for personal injuries to all passengers, other than the driver, arising out of the use of a vehicle.’
11 Directive 2009/103 codified the earlier directives relating to insurance against civil liability in respect of the use of motor vehicles (‘civil liability in respect of the use of motor vehicles’) and therefore repealed those earlier directives with effect from 27 October 2009. Pursuant to the correlation table in Annex II to that directive, Article 3(1) of the First Directive corresponds to the first and second subparagraphs of Article 3 of Directive 2009/103; Article 1(4), third subparagraph, and Article 2(1) of the Second Directive correspond to Article 10(2), second subparagraph, and Article 13(1) of Directive 2009/103 respectively; and Article 1, first subparagraph, of the Third Directive corresponds to Article 12(1) of Directive 2009/103.
National law
12 Section 151 of the Road Traffic Act 1988 (‘the 1988 Act’), concerning the duty of insurers to satisfy a judgment which relates to civil liability of the type covered by a compulsory insurance policy, provides:
‘(1) This section applies where, after a certificate of insurance … has been delivered … to the person by whom a policy has been effected …, a judgment to which this subsection applies is obtained.
…
(5) Notwithstanding that the insurer may be entitled to avoid or cancel, or may have avoided or cancelled, the policy…, he must, subject to the provisions of this section, pay to the persons entitled to the benefit of the judgment –
(a) as regards liability in respect of death or bodily injury, any sum payable under the judgment in respect of [that] liability …,
…
…
(8) Where an insurer becomes liable under this section to pay an amount in respect of a liability of a person who is not insured by a policy…, he is entitled to recover the amount from that person or from any person who –
(a) is insured by the policy…, by the terms of which the liability would be covered if the policy insured all persons …, and
(b) caused or permitted the use of the vehicle which gave rise to the liability.
…’
The actions in the main proceedings and the questions referred for a preliminary ruling
13 Mr Wilkinson was a named driver on an insurance policy with Churchill covering the use of a motor vehicle. On 23 November 2005, he allowed one of his friends to drive the car with himself as a passenger. It is accepted that Mr Wilkinson knew that that person was not insured to drive the car under that insurance policy. The driver lost control of the vehicle, which collided with a vehicle travelling in the opposite direction. Mr Wilkinson suffered severe injuries. Churchill accepted that it was liable to compensate Mr Wilkinson, but claimed, pursuant to section 151(8) of the 1988 Act, an indemnity from him as the insured in the same amount as the compensation payable to him. Mr Wilkinson contested this claim. At first instance the court held in favour of Mr Wilkinson, and Churchill brought an appeal against that judgment before the Court of Appeal.
14 Mrs Evans, who owned a motorcycle insured with Equity, was insured to drive it, but no one else at all was. On 4 August 2004, she permitted a friend to drive her motorcycle with herself as a pillion passenger. Through negligence, the driver drove into the back of a lorry. Mrs Evans was seriously injured. At first instance, the court found that, in permitting him to drive, she had given no thought to the question whether the driver was insured to drive her motorcycle. It also held that Equity was entitled to an indemnity under section 151(8) of the 1988 Act in respect of the sum that Equity would have had to pay to Mrs Evans, because she had allowed someone to drive the motorcycle without being insured. Mrs Evans lodged an appeal against that judgment before the Court of Appeal.
15 Churchill and Equity argued before the Court of Appeal that section 151(8) of the 1988 Act is not a provision which ‘excludes from insurance’, within the meaning of Article 13(1) of Directive 2009/103, and that the drivers in both cases had the requisite authorisation to use or drive the vehicles in question. On the other hand, Mr Wilkinson and Mrs Evans argued, first, that that provision, when applied to an insured who is a victim so that he is precluded from receiving payment from the insurer, excludes that victim from insurance within the meaning of Article 13(1) and, second, that the authorisation referred to in that provision is that of the insurer, not the insured.
16 The Court of Appeal found that, under the law of England and Wales, the effect of section 151(8) of the 1988 Act is to exclude automatically from the benefit of insurance an insured who, taking a place as a passenger in the vehicle that he is insured to drive, has given an uninsured driver permission to drive that vehicle. The Court of Appeal is uncertain whether European Union law precludes such an exclusion and, if so, whether section 151(8) of the 1988 Act may be interpreted in a manner consistent with European Union law.
17 The referring court considers that, according to the case-law, Article 12(1) of Directive 2009/103 must be given a broad interpretation. It notes, however, that in circumstances such as those of the cases before it, such an interpretation would lead to a difference in treatment in relation to the situation governed by Article 10(2) of Directive 2009/103. The Court of Appeal also points out that the situation of an insured passenger permitting an uninsured driver to drive can vary, depending on whether that passenger is aware that the driver is uninsured, or whether or not the passenger has turned his or her mind to that question.
18 In those circumstances, the Court of Appeal (England and Wales) (Civil Division) decided to stay proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘1. Are Articles 12(1) and 13(1) of [Directive 2009/103] to be interpreted as precluding national provisions the effect of which, as a matter of the relevant national law, is to exclude from the benefit of insurance a victim of a road traffic accident, in circumstances where:
– that accident was caused by an uninsured driver; and
– that uninsured driver had been given permission to drive the vehicle by the victim; and
– that victim was a passenger in the vehicle at the time of the accident; and
– that victim was insured to drive the vehicle in question?
In particular:
– is such a national provision one which “excludes from insurance” within the meaning of Article 13(1) of [Directive 2009/103]?
– in circumstances such as arising in the present case, is permission given by the [insured] to the non-insured “express or implied authorisation” within the meaning of Article 13(l)(a) of [Directive 2009/103]?
– is the answer to this question affected by the fact that, pursuant to Article 10 of [Directive 2009/103], national bodies charged with providing compensation in the case of damage caused by unidentified or uninsured vehicles may exclude the payment of compensation in respect of persons who voluntarily enter the vehicle which caused the damage or injury when the body can prove that those persons know that the vehicle was uninsured?
2. Does the answer to question 1 depend on whether the permission in question (a) was based on actual knowledge that the driver in question was uninsured or (b) was based on a belief that the driver was insured or (c) where the permission in question was granted by the insured person who had not turned his/her mind to the issue?’
Consideration of the questions referred
The first question
19 It should be noted as a preliminary observation that Directive 2009/103 was not in force at the time of the facts in the main proceedings. The question referred must, therefore, be construed as referring, not to the provisions of Directive 2009/103, but to those corresponding provisions in the Second and Third Directives that are applicable ratione temporis to the facts in the main proceedings and that were subsequently incorporated into Directive 2009/103.
20 By its first question, the referring court therefore asks, in essence, whether Article 1, first subparagraph, of the Third Directive and Article 2(1) of the Second Directive must be interpreted as precluding national rules whose effect is to exclude from the benefit of insurance a victim of a road traffic accident when that accident was caused by an uninsured driver and when the victim, a passenger in the vehicle at the time of the accident, was insured to drive the vehicle himself and had given permission to the driver to drive it.
21 In that regard, Churchill and Equity claim, first, that the provisions of Directive 2009/103 corresponding to Article 2(1) of the Second Directive are not applicable in the present case. Section 151(8) of the 1988 Act would not constitute an exclusion from compulsory insurance cover. The effect of that provision, according to Churchill and Equity, is merely to entitle an insurer, when it is required to pay compensation in respect of the liability of a driver not insured under the insurance policy, to bring an action against the insured, when the insured has caused or permitted to the driver to drive the vehicle, for recovery of that amount.
22 However, according to settled case-law, in the procedure laid down by Article 267 TFEU, the functions of the Court of Justice and those of the referring court are clearly separate, and it falls exclusively to the latter to interpret national legislation and assess its effects (see Case 52/76 Benedetti [1977] ECR 163, paragraph 25; Case C‑397/96 Kordel and Others [1999] ECR I‑5959, paragraph 25; and Case C‑500/06 Corporación Dermoestética [2008] ECR I‑5785, paragraph 21).
23 It is apparent from the order for reference that the Court of Appeal interprets Section 151(8) of the 1988 Act, in situations such as those described in the first question referred for a preliminary ruling, not as providing for the payment of compensation by the insurer to the insured victim, followed by reimbursement of that amount by the insured to the insurer, but as having the effect of excluding automatically from the benefit of insurance a passenger, the victim of a road traffic accident, who is insured to drive the vehicle himself and who has given permission to an uninsured driver to drive.
24 It follows that the questions referred to the Court in the present case do not concern the compatibility with EU law of a rule governing civil liability, but concern rather the compatibility with EU law of a provision which, according to the interpretation given by the referring court, by excluding automatically the benefit of compensation possibly due to an insured, limits the extent of civil liability insurance cover. The questions referred therefore do indeed concern the scope of the relevant EU rules.
25 Churchill, Equity and the United Kingdom Government further submit that the first question should be answered in the negative. Persons in a situation such as that of Mr Wilkinson and Mrs Evans cannot be considered to be third parties who have been victims of an accident within the meaning of Article 2(1) of the Second Directive.
26 By contrast, Mr Wilkinson, Mrs Evans and the European Commission take the view that EU rules relating to civil liability in respect of the use of motor vehicles preclude a national provision such as that described in the first question. In particular, the Commission considers that a victim of a road traffic accident cannot be excluded from the category of passenger merely on the basis that he is insured. Consequently, according to the Commission, an insured who is a victim must be considered to be a third party who has been a victim of an accident within the meaning of Article 2(1) of the Second Directive.
27 In that regard, it must be borne in mind that EU rules relating to civil liability in respect of the use of motor vehicles are designed to ensure the free movement of vehicles normally based on EU territory and of persons travelling in those vehicles and to guarantee that the victims of accidents caused by those vehicles receive comparable treatment irrespective of where in the EU the accident has occurred (see, inter alia, Case C‑129/94 Ruiz Bernáldez [1996] ECR I‑1829, paragraph 13, and Case C‑537/03 Candolin and Others [2005] ECR I‑5745, paragraph 17). They also seek, as set out in the fifth recital in the preamble to the Third Directive, to protect that particularly vulnerable category of potential victims who are motor vehicle passengers by filling the gaps in the compulsory insurance cover of those passengers in certain Member States (Case C‑356/05 Farrell [2007] ECR I‑3067, paragraph 24).
28 To those ends, Article 3(1) of the First Directive, as amplified and supplemented by the Second and Third Directives, requires the Member States to ensure that civil liability in respect of the use of motor vehicles normally based in their territory is covered by insurance, and specifies, inter alia, the types of damage and the third parties who have been victims of an accident to be covered by that insurance (see, to that effect, Case C‑348/98 Mendes Ferreira and Delgado Correia Ferreira [2000] ECR I‑6711, paragraphs 25 to 27, and Case C‑484/09 Carvalho Ferreira Santos [2011] ECR I‑0000, paragraphs 25 to 27).
29 In that last regard, the Court has already held that the aim of Article 3(1) of the First Directive, Article 2(1) of the Second Directive and Article 1 of the Third Directive is to ensure that compulsory motor vehicle insurance against civil liability in respect of the use of motor vehicles allows all passengers who are victims of an accident caused by a motor vehicle to be compensated for the injury or loss they have suffered (see, to that effect, Candolin and Others, paragraph 27). It also considered that, by providing that insurance against civil liability in respect of the use of motor vehicles covers liability for personal injuries to all passengers other than the driver, Article 1 of the Third Directive only lays down a distinction between the driver and the other passengers and unquestionably grants insurance cover to all passengers (Candolin and Others, paragraph 32, and Farrell, paragraph 23).
30 In view of this, the Court held that the aim of protecting victims pursued by the First, Second and Third Directives, as has been pointed out in paragraph 27 of this judgment, requires the legal position of the owner of the vehicle, present in the vehicle at the time of the accident as a passenger, to be the same as that of any other passenger who is a victim of the accident (Candolin and Others, paragraph 33). Likewise, it held that that aim also precludes national rules from restricting unduly the concept of passenger covered by insurance against civil liability in respect of the use of motor vehicles, by excluding from that concept persons who were on board a part of a vehicle which is not designed for their carriage and equipped for that purpose (see, to that effect, Farrell, paragraphs 28 to 30).
31 The only distinction permitted by EU rules relating to civil liability in respect of the use of motor vehicles thus being, as pointed out in paragraph 29 of this judgment and as the Advocate General has noted in point 28 of his Opinion, that between the driver and passenger, the same aim of protecting victims also requires the legal position of the person who, at the time of the accident, was a passenger in the vehicle in respect of which he was insured to drive, to be the same as that of any other passenger who is a victim of the accident.
32 It follows that the fact that a person was insured to drive the vehicle which caused the accident does not mean that that person should be excluded from the concept of third parties who have been victims of an accident within the meaning of Article 2(1) of the Second Directive, in so far as he was a passenger in that vehicle and not the driver.
33 With regard to the rights granted to those third parties who have been victims of an accident, it must be borne in mind that the Court has held that Article 3(1) of the First Directive precludes an insurer from relying on statutory provisions or contractual clauses in order to refuse to compensate third parties who have been victims of an accident caused by the insured vehicle (see, to that effect, Ruiz Bernáldez, paragraph 20, Candolin and Others, paragraph 18, and Carvalho Ferreira Santos, paragraph 29).
34 The Court has also held that the first subparagraph of Article 2(1) of the Second Directive simply repeats that obligation, with respect to provisions or clauses in an insurance policy referred to in that article excluding from the cover provided by insurance against civil liability in respect of the use of motor vehicles, damage or injury suffered by third parties who have been victims of an accident caused by the use or driving of an insured vehicle by persons not authorised to drive the vehicle, persons not holding a driving licence, or persons in breach of the statutory technical requirements concerning the condition and safety of the vehicle (Ruiz Bernáldez, paragraph 21; Candolin and Others, paragraph 19; and Carvalho Ferreira Santos, paragraph 30).
35 It is true that by way of derogation from that obligation, the second subparagraph of Article 2(1) provides that certain persons may be excluded from compensation by the insurer, having regard to the situation they have themselves brought about, that is to say, persons who voluntarily entered the vehicle which caused the damage or injury, when the insurer can prove that they knew the vehicle was stolen (Ruiz Bernáldez, paragraph 21, Candolin and Others, paragraph 20). However, and as the Court has already held, derogations from the first subparagraph of Article 2(1) of the Second Directive may only be made in that single, specific case (see, to that effect, Candolin and Others, paragraph 23).
36 It follows from the foregoing that Article 1, first subparagraph, of the Third Directive and Article 2(1) of the Second Directive must be interpreted as precluding national rules the effect of which is to omit automatically the requirement that the insurer should compensate a passenger, the victim of a road traffic accident, on the ground that that passenger was insured to drive the vehicle which caused the accident but that the driver was not.
37 In that context, the referring court also asks the Court whether permission to drive given by the insured to a non-insured driver constitutes, in circumstances such as those in the main proceedings, ‘express or implied authorisation’ within the meaning of the first indent of Article 2(1) of the Second Directive. As the Advocate General has stressed in point 42 of his Opinion, the referring court asks this question in order to establish whether the statutory provisions and contractual clauses excluding insurance cover when the driver was a person who had not received express or implied authorisation from the insurer may be invoked against the victim.
38 However, that argument cannot be accepted. Even if the terms ‘express or implied authorisation’ did refer only to permission given by the insured, it cannot, in any event, mean that a clause excluding insurance cover when the driver was a person who had not received authorisation from the insurer would be valid and enforceable against a third party who has been a victim of an accident. The only situation in which a third party who has been a victim of an accident may be excluded from insurance cover is that specified in the second subparagraph of Article 2(1) of the Second Directive. It is not disputed that, in the present case, that situation is not in issue.
39 Nevertheless, the referring court also asks whether the fact that, in accordance with the third subparagraph of Article 1(4) of the Second Directive, Member States may exclude the payment of compensation by a national body in respect of persons who voluntarily entered the vehicle which caused the damage or injury, when the body can prove that they knew it was uninsured, can have a bearing on the answer to question 1.
40 In that regard, it is first necessary to point out that the situation in which the vehicle that caused the damage was driven by a person not insured to do so, while a driver was, moreover, insured to drive that vehicle, and the situation specified in the third subparagraph of Article 1(4) of the Second Directive in which the vehicle which caused the accident was not covered by any insurance policy, are situations neither similar nor comparable. The fact that a vehicle is driven by a person not named in the relevant insurance policy cannot, having regard, in particular, to the aim of protecting victims of road traffic accidents pursued by the First, Second and Third Directives, support the view that that vehicle was not insured for the purpose of that provision.
41 Second, as noted by the Commission, the payment of compensation by a national body is considered to be a measure of last resort, provided for only in cases in which the vehicle that caused the injury or damage is uninsured or unidentified or has not satisfied the insurance requirements referred to in Article 3(1) of the First Directive.
42 This explains why, despite the general aim of protecting victims of EU rules relating to civil liability in respect of the use of motor vehicles, the EU legislature allows Member States to exclude the payment of compensation by that national body in certain limited cases, and, in particular, in respect of persons who voluntarily entered the vehicle which caused the damage or injury when the body can prove that they knew that neither the driver nor the vehicle was insured.
43 Consequently, the fact that, in accordance with the third subparagraph of Article 1(4) of the Second Directive, Member States may exclude the payment of compensation by a national body in respect of persons who voluntarily entered the vehicle which caused the damage or injury when the body can prove that they knew that neither the driver nor the vehicle was insured, has, in the present case, no bearing on the interpretation of Article 1, first subparagraph, of the Third Directive and Article 2(1) of the Second Directive.
44 In the light of the foregoing, the answer to the first question is that Article 1, first subparagraph, of the Third Directive and Article 2(1) of the Second Directive must be interpreted as precluding national rules whose effect is to omit automatically the requirement that the insurer should compensate a passenger who is a victim of a road traffic accident when that accident was caused by a driver not insured under the insurance policy and when the victim, who was a passenger in the vehicle at the time of the accident, was insured to drive the vehicle himself and who had given permission to the driver to drive it.
The second question
45 By its second question, the referring court asks, in essence, whether the answer to the first question would be different, depending on whether the insured victim was aware that the person to whom he gave permission to drive the vehicle was not insured to do so, whether he believed that the driver was insured or whether or not he had turned his mind to that question.
46 In that regard, it must be borne in mind, as the Advocate General has noted in point 50 of his Opinion, that the insurance against civil liability in respect of the use of motor vehicles referred to in Article 3(1) of the First Directive must cover all of the victims other than the driver of the vehicle which caused the damage or injury, unless one of the exceptions expressly provided for by the First, Second or Third Directives applies.
47 The fact that the insured victim was aware that the person to whom he gave permission to drive the vehicle was not insured to do so, or that he believed that the driver was insured or whether or not he had turned his mind to that question therefore has no bearing on the answer to question 1.
48 That does not, however, mean that the Member States may not take account of every factor within the ambit of their rules relating to civil liability provided, none the less, that they exercise their powers in that field in compliance with EU law and, in particular, with Article 3(1) of the First Directive, Article 2(1) of the Second Directive and Article 1 of the Third Directive and that those national rules do not deprive those directives of their effectiveness (Ruiz Bernáldez, paragraph 19; Candolin and Others, paragraphs 27 and 28; Farrell, paragraph 34; Carvalho Ferreira Santos, paragraphs 35 and 36; and Case C‑409/09 Ambrósio Lavrador and Olival Ferreira Bonifácio [2011] ECR I‑0000, paragraph 28).
49 Accordingly, national rules, formulated in terms of general and abstract criteria, may not refuse or restrict to a disproportionate extent the compensation to be made available to a passenger by compulsory insurance against civil liability in respect of the use of motor vehicles solely on the basis of his contribution to the occurrence of the loss which arises. It is only in exceptional circumstances that the amount of compensation may be limited on the basis of an assessment of that particular case (Candolin and Others, paragraphs 29, 30 and 35; Farrell, paragraph 35; Carvalho Ferreira Santos, paragraph 38; and Ambrósio Lavrador and Olival Ferreira Bonifácio, paragraph 29).
50 In the light of the foregoing, the answer to the second question is that the answer to the first question is not different depending on whether the insured victim was aware that the person to whom he gave permission to drive the vehicle was not insured to do so, whether he believed that the driver was insured or whether or not he had turned his mind to that question.
Costs
51 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
On those grounds, the Court (Fourth Chamber) hereby rules:
1. Article 1, first subparagraph, of the Third Council Directive 90/232/EEC of 14 May 1990 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles, and Article 2(1) of the Second Council Directive 84/5/EEC of 30 December 1983 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles, must be interpreted as precluding national rules the effect of which is to omit automatically the requirement that the insurer compensate a passenger who is a victim of a road traffic accident when that accident was caused by a driver who was not insured under the insurance policy and when the victim, who was a passenger in the vehicle at the time of the accident, was insured to drive the vehicle himself but who had given permission to the driver to drive it.
2. The answer to the first question is not different depending on whether the insured victim was aware that the person to whom he gave permission to drive the vehicle was not insured to do so, whether he believed that the driver was insured or whether or not he had turned his mind to that question.
[Signatures]
* Language of the case: English.
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