Nawaz And Hussain v Crowe Insurance Group [2003]
- Reported: [2003] EWCA Civ 316
- Year: 2003
- Court: Court of Appeal
FACTS:-
On the 25th August 1998, there was a road traffic accident involving a vehicle driven by Nawaz and in which Hussain was a passenger and another vehicle driven by Mr Chaudry. Crowe were Chaudry’s insurers and they instructed solicitors, but had not given those solicitors authority to accept service.
There was a series of communications between a trainee solicitor in the Nawaz and Hussain’s firm and the insurers’ solicitors. On the 16th May 2000 the trainee solicitor rang and spoke to the legal secretary of the partner dealing with the matter in order to obtain the address of the Defendant. There was a second conversation on the 17th May 2000 when the trainee solicitor spoke to a secretary and said that Mr Chaudry’s address was required as proceedings were about to be issued against him. A clear attendance note was taken by the trainee solicitor of the conversation which included the words “told secretary we are now issuing.” However the legal secretary did not take an attendance note and this information was not passed on to the partner of the firm instructed by the insurers.
Nawaz and Hussain issued proceedings against Mr Chaudry some three weeks later and obtained a default judgment on the 8th July 2000. Thereafter separate proceedings were issued against Crowe to enforce that judgment pursuant to section 151 of the Road Traffic Act 1988. Crowe argued that the solicitors acting for Nawaz and Hussain had failed to comply with section 152(1)(a) of the Road Traffic Act 1988, which stated that a judgment cannot be enforced against insurers unless “before or within seven days after the commencement of the proceedings in which the judgment was given, the insurer had notice of the bringing of proceedings.
The district judge held that section 152(1)(a) had been complied with but this was reversed by HHJ Tetlow. The insurers accepted that the solicitors would have been authorised to receive notice under section 152(1)(a) of the Road Traffic Act 1988.
HELD:-
Lord Woolf gave the lead judgment. The issue before the court was divided into two parts, first whether notice was given to a person who an appropriate person to receive that notice under section 152 of the Road Traffic Act 1988, and secondly if a notice was given under that section, whether the notice was sufficient for the purposes of the section.
Lord Woolf considered the provisions of section 152(1). The effect of that section was that if there was no proper notice served on an appropriate person for the purposes of the section, then the liability of an insurer would come to an end. Section 152 allowed the insurer to take certain steps to protect itself from being faced with liability because of a judgment given against an insured, where it would be entitled either to avoid the policy under which it provided insurance by seeking a declaration an indicated in section 152(2) or by exercising its right under subsection (4) to be made a party to the action.
Lord Woolf referred to the previous case of Wylie v Wake [2001] RTR 291 and Desouza v Waterlow [1999] RTR 71. In Desouza the court had said that notice in any particular case was a matter of fact and degree and would turn on the extent to which the insurer has been made aware of the background, circumstances and of the position of the claimant with regard to the taking of proceedings. Notice can be given orally or in writing.
In Wylie Lord Justice Kennedy had said:-
- There must be more than evidence of a casual comment to someone who at times acted as an agent for the insurers. There must be a degree of formality when giving a notice orally under section 152
- Any notification must not be subject to a condition which may or may not be fulfilled.
- The notice can be oral and it need not emanate from the Claimant
- Whether notice if given is a matter of fact and degree
- The essential purpose of the requirement is to ensure that the insurer is not suddenly faced with a judgement that he has to satisfy without any opportunity to take part in the proceedings
In the present case no written notice had been given. The insurers accepted that their solicitors were authorised to accept any notice under section 152. Lord Woolf said that it was self evidence that the solicitors did have authority to receive the notice.
There was an issue as to whether notice could be given to a legal secretary. Lord Woolf said that notice could not be given to someone such as a janitor, but a legal secretary was the sort of person to whom notice could be given. The fact that the legal secretary had not told the partner was not the critical question. Everything depended on the circumstances.
The trainee solicitor (who had had the conversations with the legal secretary) did not appreciate the significance of giving notice. The focus of the second conversation on the 17th May 2000 was to obtain the Defendant’s address. However, that conversation also made it clear that proceedings were about to be commenced.
Lord Woolf commented that it was still open to the insurers to apply to set judgment aside, on the grounds that the claim was dishonest and also to add themselves in as Second Defendant. He was prepared to make both those orders. Therefore the notice was valid under section 152 and the Claimant’s appeal would be allowed.
Lord Justice Kennedy agreed with Lord Woolf. He commented that if clear and timely notice is not given, preferably in writing, and probably by sending to the insurers or their solicitors a copy of the claim form, the insurers are in fact left in the dark as to the commencement of proceedings and there would then be unnecessary litigation. He further commented that part, if not all of the costs might well have to be borne by those responsible for the inadequacy of the notice.
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