On 20 May 2015 the Advocate General Maciej Szpunar presented a legal opinion on an application from Landesgericht Korneburg (Austria) to the Court of Justice of the European Union for the issuance of a preliminary ruling (Case C-240/14). The subject of the opinion was the determination of the jurisdiction and the law applicable for making claims directly against the insurer of a person responsible for an aviation accident (more broadly, against a civil liability insurer). 

Factual situation 

The application to the Court of Justice was made by an Austrian court which had doubts during the consideration of a case filed by Eleonore Prüller-Frey against Norbert Broding and AXA Versicherung AG. Wishing to purchase real estate in Spain, the claimant took a flight to view the property. She flew with the owner of the plane, who was not the plane’s insurance policyholder. The flight ended in an accident which resulted in the claimant being injured. She sued Norbert Broding, as the insurance policyholder, and AXA, the civil liability insurer. The insurance policy indicated that the applicable law was German law and reserved the jurisdiction of German courts. 

On the basis of these facts, the Austrian court asked the Court of Justice a number of preliminary questions. Its primary concern was whether, when a plane takes off and lands in the same place in a Member State, and when the carriage is performed free of charge, the Convention for the Unification of Certain Rules for International Carriage by Air of 28 May 1999 (the Montreal Convention) is applicable, or if national (EU) law should apply. 

Question of jurisdiction – for insurers of airlines 

According to the Advocate General, the Montreal Convention and Council Regulation (EC) no. 2027/97 on air carrier liability in respect of accidents as amended by Regulation (EC) no. 889/2002 of the European Parliament and of the Council, establishes a uniform system of liability for international air transport. Under these Regulations the Montreal Convention covers intra-EU domestic flights. The Convention will therefore apply to domestic flights within the EU, as long as these flights are performed by an air carrier with a valid operating licence within the meaning of the Regulation of the European Parliament and of the Council (EC) no. 1008/2008 on common rules for the operation of air services within the Community. Therefore, as there was no obligation for the carrier to have such a licence, the Advocate General’s opinion was that the Montreal Convention should not apply. The consequence of this view is that it is necessary to establish jurisdiction on the basis of Council Regulation (EC) no. 44/2001 on jurisdiction and the recognition of court judgments and their enforcement in civil and commercial matters (Brussels I) and not on the basis of the Montreal Convention. But if the air carrier had an obligation to hold a licence, jurisdiction would be determined on the basis of the Montreal Convention. 

Question of applicable law – for civil liability insurers 

The Austrian court’s doubts also concerned the law under which it should assess the possibility of pursuing claims directly from the insurer of the person responsible for the accident. In this regard, the Advocate General referred to Art. 18 of Regulation (EC) no. 864/2007 of the European Parliament and of the Council on the law applicable to non-contractual obligations (Rome II), which states: “A person who has suffered damage may claim compensation directly against the insurer of the person responsible if the applicable law for non-contractual obligations or the applicable law for insurance contracts provides for it”. Although the opinion of the Advocate General was issued on the basis of very specific circumstances, the conclusions it contains regarding the applicable law apply in principle to all civil liability insurers. 

As a result, in the opinion of the Advocate General, an assessment of whether it is possible to bring an action directly against a civil liability insurer should be made in light of either the law applicable to non-contractual obligations (law of the country in which the damage occurred or the law of the country where the responsible person and the victim had their habitual residence at the time of the damage) or the law applicable to the insurance contract. It is enough if just one of the two legal systems provides for the possibility of bringing an action directly against the insurer of the person responsible for the accident.The Advocate General pointed out that in order to determine whether the claimant was entitled to bring an action directly against AXA Versicherung AG, it is necessary to establish whether Spanish law (as the applicable law for non-contractual obligations) or German law (as the applicable law for the insurance contract) provides for such a possibility. 

Art. 18 of Rome II defines the legal system under which the existence of the possibility to bring an action directly against a civil liability insurer must be evaluated. However, the obligations of the insurer arising out of civil liability insurance will be assessed in the light of the law applicable to the contract (in this case German law). 

In addition, the Advocate General indicated that the possibility of bringing an action directly against the insurer is not regulated by the Montreal Convention. In particular, Art. 29 of the Convention, which establishes the principle of exclusivity of a system of responsibility, does not preclude bringing an action directly against an insurer. 

Conclusions 

This opinion is significant for civil liability insurers, particularly insurers of air carriers that are required to hold an operating licence to carry out intra-EU flights. The opinion unambiguously determines that in the case of claims made directly against such insurers by victims of air accidents, the jurisdiction of the courts should be evaluated in light of the Montreal Convention (Art. 33). In the case of private, free-of-charge flights, jurisdiction should be determined in accordance with the Brussels I regulation. And in turn, the law applicable to the possibility of making claims directly against a civil liability insurer should be judged according to either the applicable law for non-contractual obligations (in accordance with Rome II) or the applicable law for the insurance contract. At the same time the obligations of such insurer will be assessed in the light of the law applicable to the civil liability insurance. Thus, insurers must come to terms with the possibility of being directly sued by victims of air accidents, even if a particular insurance policy is subject to the law of a state which does not provide for the possibility of direct action against an insurer.