Supreme Court rules on whether the quantification of damages recoverable from a German insurer was governed by English or German law

The earlier decisions in this case were reported in Weekly Updates 39/11 and 23/12. The claimant’s  English husband was killed by a German driver in Germany. Liability (which was governed by German  law) was admitted and the issue in dispute in this case was whether the assessment of the widow’s  damages was governed by English or German law (this was of importance because she would obtain a higher payout under the English Fatal  Accidents Act 1976 (“the FAA”) than under the German law equivalent (section 844 of the German  Civil Code) because her subsequent re-marriage would not be taken into account under the FAA). The Court of Appeal had reversed the  first instance decision by finding that the law of the forum where the claim was heard (here,  English law) applied because the issue was procedural rather than substantive (but that the FAA did  not apply in this case). The Supreme Court has now dismissed the appeal from that decision.

The Private International (Miscellaneous Provisions) Act 1995 applied here because the death  occurred before Regulation II came into force. Although the Court of Appeal had held that the FAA  could not be applied to a cause of action under section 844 because the relevant damages provisions  in the FAA were procedural, the Supreme Court applied different reasoning.

It held that it was irrelevant whether the FAA damages provisions were substantive or procedural:  if substantive, then German law would apply anyway; if procedural, the provisions in the FAA only  applied to actions under the Act itself. The rules of assessment which apply generally in English  law provide that the widow must be put back into the same financial position as she would have been  if her husband had not been killed. She cannot be put back into a better position and hence credit  must be given for maintenance from her subsequent partner since the birth of the child which they  had together. However, since the new partner had no legal duty of maintenance (under either English or German law) prior to the birth of the child, credit did not have to be given for  maintenance received from him before that date.

COMMENT: As mentioned, the 1995 Act applied here because the cause of action arose before Regulation II came into force. Rome II applies to causes  of action arising after 11 January 2009. The position now is that someone in the position of the  widow in this case will recover in respect of  a German cause of action what she would have  recovered in a German court, because Article 15(c) of the Regulation applies the applicable law to  “the existence, the nature and the assessment of damage or the remedy claimed.”