As the Coronavirus pandemic continues to dominate world news, it feels like Brexit has been kicked into the long grass. However, the pandemic will pass and, when it does, Brexit will still be a reality. As the pent-up demand for international travel is unleashed later this year, the rights of UK nationals who are seriously injured in Europe will, for now, be protected by consumer-friendly provisions on jurisdiction and enforcement. Uncertainty remains as to what will happen to these important consumer rights when the Brexit transition period ends.
How do injury victims currently benefit from the European private international law regime?
The general position under the Brussels Recast Regulation is that an individual or company domiciled in a member state shall be sued in the courts of that member state. However, the Regulation gives an injured person the right to take legal action in their home courts in a number of circumstances, including the right to:
- Sue an insurer directly where such a direct right of action is permitted, which is notably the case for all EU motor accidents.
- Join the insured party to proceedings brought against the insurer. However, this is the subject of a reference to the Court of Justice of the European Union (CJEU) in the case of Cole v IVI so the legal position could change. This is an important right in cases where suing the insurer alone may not be sufficient, for example, in serious injury cases where the defendant has limited insurance.
- Pursue a claim against the other party to a contract in the UK courts, if injured while enjoying services provided as part of a consumer contract. Common examples include holiday accommodation, excursions or activities: see, for example, Lackey v Mallorca Mega Resort SL and Generali (2019).
- Bring the ‘foreign’ defendant into the UK courts where there is a defendant based in the UK and another defendant based elsewhere in the EU, and there is a close connection between the claims against each defendant.
In addition, the regime provides for automatic recognition and enforcement of judgments. This is an essential corollary to the jurisdictional rights, and enables claimants to obtain the compensation they have been awarded from a defendant based elsewhere in the EU.
The Lugano Convention provides comparable rights to individuals injured in or in disputes involving members of the European Free Trade Agreement (EFTA) states of Iceland, Switzerland and Norway. The UK benefits from the EU’s accession to the Convention, although that benefit will be lost at the end of the transition period (currently due to take place on 31 December 2020).
Future framework – Lugano to the rescue?
To ensure that the rights of seriously injured individuals are protected after the transition period ends, an agreement must be reached between the EU and UK in the next eight months on a suitable replacement to the current jurisdiction and enforcement regime for civil and commercial matters.
The UK’s preferred solution is to accede to the Lugano Convention in its own right, an intention expressed by the UK Ministry of Justice in January 2020. If the EU agrees, the Lugano Convention could come to the rescue of the many UK nationals seriously injured in EU/EFTA countries each year, enabling them to continue to pursue a claim for damages in the UK courts as the weaker party to a dispute. The Lugano Convention has the advantage of being familiar
to the UK courts and practitioners. It also provides an efficient means of enforcing a judgment in another state signatory to the Convention. If the UK accedes to Lugano, its courts will be required to ‘pay due account’ to the case law of other state signatories, including the CJEU. This will encourage uniformity of application but, crucially, the UK will not be bound by those decisions. This is an important distinction that makes Lugano more politically palatable to the current UK government.
Alternative solutions to Lugano include:
(i) a new bilateral treaty on jurisdiction and enforcement between the UK and EU/EFTA; or
(ii) a new international Hague Convention in this area of private international law which goes further than the Hague Judgments Convention 2019.
These solutions would take time to negotiate, agree and ratify. They would not provide an immediate means of redress at the end of the transition period for individuals from the UK who are seriously injured when travelling in the EU/EFTA countries. This highlights the fact that it would be more effective and pragmatic if the UK were to accede to the Lugano Convention.
If no agreement is reached on a suitable replacement to the current European regime, the UK will revert to common law principles and rules on jurisdiction and enforcement. In practice, these rules require an individual to serve proceedings on a defendant when they are within the geographical jurisdiction of the English courts or to obtain the court’s permission to serve out of the jurisdiction. Such permission is only given if certain criteria are met. Likewise, when trying to enforce a judgment from the UK courts, the claimant will need to follow local rules and procedures in the relevant EU/EFTA country, rather than rely on the convenience of the European regime. This will increase litigation costs to injured parties, lead to uncertainty of outcome and reduce individual access to justice for those who need it most.
Encouragingly, the UK has received statements of support to its request for accession to the Lugano Convention from Iceland, Norway and Switzerland. Presently the EU has given no indication as to its stance, and there has been no evidence on the EU’s mandate in respect of negotiations concerning future civil judicial cooperation. With talks scheduled to resume in April and further rounds scheduled for May and June, there may soon be signs of progress towards an agreement, or lack thereof, between the UK and EU in this important area of rights and protections for consumers and serious injury victims.
Christopher Deacon, Partner, and Ryan Hooton, Trainee Solicitor, Aviation and International Injury Department, STEWARTS