Woods v Thompson and Saxon Motor and General Insurance Company Ltd

• Jurisdiction: Cayman Islands
• Judge: Ingrid Mangatal,(Mangatal, J.)
• Judgment Date: 12 July 2016
• Date: 12 July 2016
• Docket Number: CAUSE NO G 229 of 2015
• Court: Grand Court (Cayman Islands)

Between

Robert Woods

Plaintiff

and

1. Floris Thompson

2. Saxon Motor & General Insurance Company Ltd.

Defendants

Before:

The Hon. Justice Ingrid Mangatal

CAUSE NO G 229 of 2015

IN THE GRAND COURT OF THE CAYMAN ISLANDS

HEADNOTE

Insurance Law — Civil procedure and practice — Motor Vehicle Insurance (Third Party Risks) Law (2012 Revision), s.4,15 and 17 — Limitation Law (1996 Revision), s. 30, GCR. O.20, O.14, O.14A, O.15, Rule 6 — Whether Third Party can properly sue Insurance Company for consequential relief, before obtaining judgment against insured — Whether declaration would be just in relation to all parties — Whether the most effective way of resolving the issues. — Application to Strike Out and Summary Judgment Application by insurer.

Appearances:

Ms. S Dobbyn and Ms. B Tomascik of Sinclairs on behalf of the Plaintiff

Mr. P Keeble and Ms. S Tummala of Hampson & Co on behalf of the Defendants

IN CHAMBERS

1 The Plaintiff, Robert Woods, was injured in a motor cycle accident on 27 December 2013 whilst riding his motor bike along Shamrock Road. The Amended Statement of Claim avers that the collision was caused by the negligence of the First Defendant, Floris Thompson (“Mrs. Thompson”) who drove her 2007 Kia Sorento out of Prospect Drive and into the path of Mr. Woods as he proceeded along Shamrock Road. Mrs. Thompson pleaded guilty in the Summary Court on 17 November 2015 to the offence of careless driving in relation to the accident.

2 The Second Defendant, Saxon Motor and General Insurance Company Ltd (“Saxon”) is the insurer of Mrs. Thompson's motor vehicle, the Kia Sorrento.

3 The Plaintiff issued a generally endorsed Writ of Summons against only Mrs. Thompson on 23 December 2015, the service of which was acknowledged on 8 February 2016.

4 Before any further steps had been taken in the proceedings, the Plaintiff issued an amended Writ of Summons and at the same time, a Statement of Claim on 19 February 2016, both naming Saxon as the Second Defendant.

5 The Plaintiff pleads that the accident was caused by the negligence of Mrs. Thompson. He seeks both declaratory as well as consequential relief against Saxon, as according to the Plaintiff's attorneys, they are “a party who is vitally interested in the outcome of the proceedings, being the only defendant with a significant financial interest in the proceedings” In the general endorsement to the Amended Writ of Summons, the Plaintiff claims against Saxon:

“…a declaration that the Second Defendant is required to indemnify the First Defendant pursuant to the …motor insurance policy and to satisfy any judgment obtained by the Plaintiff against the First Defendant in respect of the collision on 27 December 2013.”

6 In the Amended Statement of Claim, the Plaintiff claims against Saxon a declaration that it is liable to satisfy any award of damages, interest and costs obtained by the Plaintiff against Mrs. Thompson. It also claims against the Second Defendant damages to be assessed, interest and costs.

APPLICATIONS

7 There are two applications before the Court. On 26 February 2016 a summons was issued on behalf of the Plaintiff seeking the following orders:-

• “ ……..

• 1. That the Plaintiff be granted leave to amend the Writ of Summons to join a second defendant as a party to the proceedings, namely Saxon Motor and General Insurance Company Ltd, in accordance with Order 20 r3(a) of the Grand Court Rides.

• 2. That the amended writ of summons filed on 19 February 2016 in the form attached showing joinder of Second Defendant be approved.

• 3. Costs in the cause; and

• 4. Such other orders as the court thinks fit.”

8 On 17 March 2016 Saxon issued a summons to strike out, to dismiss and/or for determination of a question of law as follows:-

• “ ……..

• 1. An order pursuant to GCR Order 18/19(1)(a)(c)(b) and/or (d) striking the writ and Statement of Claim as against the 2 ^nd Defendant herein in its entirety on the grounds that the Statement of Claim discloses no reasonable cause of action, is scandalous, frivolous or vexatious, may prejudice and delay the action as against the 1 ^st Defendant and /or is an abuse of the process of the Court;

• 2. An order pursuant to GCR Order 14/12 dismissing the Plaintiff's claim as against the 2 ^nd Defendant and entering judgment for the 2 ^nd Defendant on the ground that the Plaintiff's claim has no prospect of success; and/or

• 3. A determination under GCR Order 14A as a point of law whether the Plaintiff has in the present circumstances pleaded, and prior to bankruptcy of the 1 ^st Defendant, or judgment against 1 ^st Defendant, any entitlement to a declaration as to coverage, or the other relief claimed against the 2 ^nd Defendant as the alleged motor vehicle insurer of 1 ^st Defendant.

• 4. The 2 ^nd Defendant's costs of this application on the indemnity or other basis, and such further and other relief as to this Honourable Court may seem just.”

9 An affidavit in support of Saxon's summons was filed on 15 April 2016, sworn to by Erwin Freeland, Saxon's Claims Manager, in which the facts pleaded in the Defence were verified and stating that in the deponent's belief, the Plaintiff has no prospect of success against Saxon.

10 Saxon summarises the grounds for its application as follows:-

• “1. The Plaintiff has no legal relationship with, cause of action, nor entitlement to declaratory or other relief against the 2 ^nd Defendant as the 1 ^st Defendant's putative motor vehicle insurer, unless and until

  • i. bankruptcy of the 1 ^st Defendant and/ or

  • ii. judgment against the 1st Defendant, as contemplated by s.9 and s.15 respectively of the Vehicle Insurance (Third Party Risks) Law (2012 Revision) neither of which events have arisen;

• 2. The Plaintiff's claim against the 2 ^nd Defendant is unsustainable in law, premature, frivolous, and vexations, hopeless and an abuse of process, and

• 3. Despite repeated efforts by the attorneys for the 2 ^nd Defendant to engage with the attorneys for the Plaintiff, including by letter of 22 February 2016 explaining that the Plaintiff has no present cause of action against the 2 ^nd Defendant, and that these proceedings against the 2 ^nd Defendant are premature and improper, the Plaintiff by his attorneys has persisted with these proceedings, and has rejected invitations of a consent dismissal as against the 2 ^nd Defendant.”

11 A Defence was also filed on behalf of Mrs. Thompson on 3 March 2016, in which Mrs. Thompson denies negligence on her part, and says that the accident was wholly caused or contributed to by the negligence of the Plaintiff. Mrs. Thompson admits that she pleaded guilty to careless driving in the Summary Court. However, she avers that this is not determinative of negligence in these civil proceedings and she claims that she pleaded guilty to the charge of careless driving for the purpose of bringing that charge, which had been pending for two years previously, to an end, and not because she considered that she had driven carelessly or was at fault for the accident.

12 A Defence was filed on behalf of Saxon on the same date as the summons to strike out and or dismiss the Plaintiff's claim. The Defence essentially raises the same points as are set out in the summons, in particular that the Plaintiff has no cause of action against Saxon that the claim is frivolous and vexatious, and further that the Plaintiff has no entitlement to declaratory relief against Saxon.

13 A Reply to Mrs. Thompson's Defence was filed on 17 March 2016, and a Reply to Saxon's Defence was filed on 30 March 2016.

14 Ms. Dobbyn, Counsel for the Plaintiff, made a number of submissions, in an attempted justification of what I view as quite unusual, that is a proceeding by a third party against an insurer prior to obtaining judgment against the insured, and not pursuant to the Vehicle Insurance (Third Party Risks) Law (2012 Revision) (“the Law”).

15 She submits that prima facie, a plaintiff is entitled to choose the person(s) against whom he wishes to proceed. Reference was made to the well-known case of Gurtner v Curtis [1968] 2 Q.B. 587. Although that was plainly a case in which it was the Motor Insurers' Bureau that sought leave to intervene, Counsel submitted that the principles are nevertheless relevant in the instant case. Reference was made to page 595 of the judgment, where Lord Denning observed as follows:

“It seems to me that when two parties are in dispute in an action at law and the determination of that dispute will directly affect a third person in his legal rights or in his pocket, in that he will be bound to foot the bill, then the court in its discretion may allow him to be added as a party on such terms as it thinks fit. By so doing, the court achieves the object of the rule. It enables all matters in dispute to “be effectually and completely determined and adjudicated upon.” between all those directly concerned in the outcome.”

16 According to Counsel, if Saxon had made an application to intervene in these proceedings as an interested party, its application would certainly have been granted. Reference was made to page 596 of the judgment, where Lord Denning stated as follows:

“…it is thus apparent that the Motor Insurers' Bureau are vitally concerned in the outcome of the action. They are directly affected, not only in their legal rights but in their pocket. They ought to be allowed to come in as defendants. It would be most unjust if they were bound to stand idly by watching the plaintiff get judgment against the defendant without saying a word when they are the people who will have to foot the bill.”

17 Ms. Dobbyn further submitted that in the Gurtner case, Lord Diplock noted that usually insurance companies would not be seeking of their own motion to become a defendant party, because they would typically have the contractual right to conduct the defence in the name of the...