Traffic Accident Board decision
The Traffic Insurance Act dates back to 1959. Traffic insurance is obligatory and insurance companies that issue traffic insurance have a duty to insure motor vehicles. The liability regime is based on strict liability: in most cases damage caused by a motor vehicle must be indemnified from the insurance even if the owner or driver cannot be blamed for the damage. The Traffic Insurance Act also covers damage to the insured vehicle's owner and driver. However, regarding damage caused by one motor vehicle to another, indemnification from insurance requires tort, negligence or fault on the part of the damaging party. The Traffic Accident Board issues recommendations regarding the compensability of bodily injuries, the classification of injuries and amounts of compensation, among other things.
The right to indemnification requires that the damage has been caused by a motor vehicle, and that the damage has derived from the use of that vehicle in traffic. The question of whether the motor vehicle was being used in traffic rarely causes problems and case law in this area is well established. However, interesting questions occasionally arise in less typical cases. The board recently rendered a recommendation regarding damage caused to an aircraft by a de-icing vehicle at a major international airport in Finland.
A de-icing vehicle had just finished spraying the wing of an aircraft with de-icing fluid on the airport ramp. As the vehicle was reversing to take its position on the other side of the aircraft in order to allow the other wing to be sprayed, it clipped the wing of another aircraft which was parked nearby. Substantial damage resulted. The insurer refused to indemnify the insured for its losses, arguing that the damage was incurred in circumstances so removed from ordinary traffic that the insurance policy did not cover the damage. The insurer also argued that the damage was not incurred in a traffic lane, but rather that the vehicle was being used in a work operation. Pursuant to the act, a vehicle is not considered to be used in traffic if it is being used outside so-called 'traffic lanes' for purposes other than the transportation of passengers or goods.
The company which owned the de-icing vehicle disagreed and asked for a recommendation from the Traffic Accident Board. The insured also argued that if the insurer was now claiming that the airport ramp did not constitute a traffic lane, then it had misled the insured when it issued an insurance policy which effectively had no purpose (given that the de-icing vehicle is specifically intended for use on the airport ramp).
Traffic Accident Board decision
The board found that although entry to the airport was restricted, traffic on the airport ramp was very heavy, with a continuous flow of service vehicles, passengers and ground handlers on the ground and apron area. Detailed traffic rules were in place to regulate the flow of traffic around the airport.
The board held that the tarmac in front of the airport could not be regarded as separate from traffic lanes. As a result, the board held that it was not necessary to consider whether the vehicle had performed work or carried passengers and goods. The board recommended that the insurer indemnify the insured.
Despite the board's authoritative recommendation, the insurer did not exceptionally indemnify the insured. In response, the insured has instigated legal proceedings in the district court.
It remains to be seen whether the court will uphold the board's recommendation. It is also possible that a new Traffic Insurance Act will be passed before the judgment becomes final.
In 2004 the Ministry of Social Affairs and Health appointed a working group to prepare a legislative reform in order to clarify and update the statutory motor liability insurance regime, while taking into account the legislative requirements of the European Union and domestic needs. The group published a memorandum in Spring 2011 which contains, for example, provisions regarding the definition of the term 'traffic lane'.
For further information on this topic please contact Matti Komonen or Herman Ljungberg at Hammarström Puhakka Partners, Attorneys Ltd by telephone (+358 9 474 2207), fax (+358 9 474 2247) or email ([email protected] or [email protected]).