In December 2013, an employee of Urban and Rural Recycling Limited was involved in a significant accident in the course of his employment and while carrying out bin collections. Mr Moore, the plaintiff in this case, was using the lifting hoist mechanism at the rear of a refuse collection truck to lift a wheelie bin containing glass. During this process, the bin fell on top of him. Urban and Rural had two insurance policies in place at the time of the accident – an employer liability policy with RSA Insurance and a motor fleet policy with Zurich Insurance.
The first was a policy from RSA which provided cover for any injuries caused to an employee unless the injuries related to a liability which was required to be insured under the Road Traffic Acts. The RSA policy also specifically excluded cover in the event that the loss or damage suffered was covered by another policy of insurance.
The second policy held was a Zurich policy which covered liability for loss, damage or injury arising from the use of a mechanically propelled vehicle. This type of insurance is compulsory under the Road Traffic Acts. Zurich’s policy expressly excluded liability for any loss, damage or injury suffered by anyone driving the vehicle or anyone in charge of the vehicle for the purpose of driving. This type of clause is standard in a motor insurance policy.
The special case
Urban and Rural and RSA Insurance sought a declaration from the High Court that Zurich Insurance’s motor fleet insurance policy should provide cover for Mr Moore’s accident and that Zurich should be liable for any damages which may become payable to Mr Moore for his injuries. In seeking this declaration, RSA posed two principle questions:
- Whether the liability of Urban and Rural to Mr Moore was a liability that required compulsory insurance under the Road Traffic Acts, and
- Depending on the answer to question 1, whether Urban and Rural was entitled to cover for Mr Moore’s claim under (a) the Zurich policy, or (b) the RSA policy, or (c) both.
In September 2021, Ms Justice Reynolds in the High Court held that the liability of Urban and Rural to Mr Moore was a liability which was required to be insured under the Road Traffic Acts and on that basis, it was the Zurich Insurance motor fleet policy which should cover the plaintiff’s accident. Ms Justice Reynolds found that the term “use” under the Road Traffic Acts covered the use of the lift mechanism on the truck involved in the accident. Ms Justice Reynolds held that despite the fact that Mr Moore had been driving the vehicle immediately prior to his accident, at the time of the accident he was not “in charge of the vehicle for the purpose of driving”. On that basis, Ms Justice Reynolds held that the exclusion in Zurich’s policy for cover for persons driving or in charge for the purpose of driving did not apply and that the accident should therefore be covered by Zurich’s motor fleet policy.
The decision was then appealed by Zurich Insurance.
The Court of Appeal – the submissions
On appeal, Zurich argued that the premise of compulsory motor insurance is to ensure that there is insurance cover for injuries caused to third parties arising from the negligent use of a vehicle by the person driving a vehicle or in charge of a vehicle for the purpose of driving. Zurich argued that there is no requirement, under the compulsory insurance regime to cover injuries caused to the user of the vehicle.
RSA Insurance contended that, as Mr Moore was operating the hoist mechanism at the time of the accident and was not driving the vehicle, he essentially became a third party for the purposes of the compulsory insurance obligations.
RSA also contended that Mr Moore was not driving the vehicle at the time of the accident nor was he in charge for the purpose of driving and therefore the exclusion in Zurich’s policy did not apply.
The Court of Appeal was satisfied that the liability, which is required to be insured under the Road Traffic Acts is any liability arising out of the negligent use of the vehicle by the user of the vehicle. The Court of Appeal held that at the time of the accident, Mr Moore was the user of the vehicle and therefore, the liability to him was not a liability which required to be insured under the compulsory insurance provisions of the Road Traffic Acts. In addition, the Court of Appeal found that Mr Moore was the person in charge of the vehicle for the purpose of driving at the time of the accident and therefore the accident fell within the exclusion clause in Zurich motor insurance policy.
It was on that basis that the Court of Appeal overturned the High Court’s decision.
The decision is an excellent analysis of the insurance requirements arising under the Road Traffic Acts and provides clarity on the meaning of the term “user”. The Court accepted that the purpose of the compulsory insurance regime is to compensate third parties and does not extend to insuring against the liability of the vehicle user to themselves. It is safe to say that the decision will have an impact on coverage considerations and policy drafting for insurers going forward.