JUDGMENT
Cameron (Respondent) v Liverpool Victoria
Insurance Co Ltd (Appellant)
before
Lord Reed, Deputy President
Lord Sumption
Lord Carnwath
Lord Hodge
Lady Black
JUDGMENT GIVEN ON
20 February 2019
Heard on 28 November 2018
Appellant Respondent
Stephen Worthington QC Benjamin Williams QC
Patrick Vincent Ben Smiley
Anneli Howard
(Instructed by Keoghs
LLP
)
(Instructed by Bond
Turner Solicitors
)
Intervener
(Motor Insurers
’ Bureau)
Tim Horlock QC
Paul Higgins
(Instructed by Weightmans
LLP (Liverpool))
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LORD SUMPTION: (with whom Lord Reed, Lord Carnwath, Lord Hodge
and Lady Black agree)
1. The question at issue on this appeal is: in what circumstances is it permissible
to sue an unnamed defendant? It arises in a rather special context in which the
problem is not uncommon. On 26 May 2013 Ms Bianca Cameron was injured when
her car collided with a Nissan Micra. It is common ground that the incident was due
to the negligence of the driver of the Micra. The registration number of the Micra
was recorded, but the driver made off without stopping or reporting the accident to
the police and has not been heard of since. The registered keeper of the Micra was
Mr Naveed Hussain, who was not the driver but has declined to identify the driver
and has been convicted of failing to do so. The car was insured under a policy issued
by Liverpool Victoria Insurance Co Ltd to a Mr Nissar Bahadur, whom the company
believes to be a fictitious person. Neither Mr Hussain nor the driver was insured
under the policy to drive the car.
The statutory framework
2. The United Kingdom was the first country in the world to introduce
compulsory motor insurance. It originated with the Road Traffic Act 1930, which
was part of a package of measures to protect accident victims, including the Third
Parties (Rights Against Insurers) Act 1930. The latter Act entitled a person to claim
directly against the insurer where an insured tortfeasor was insolvent. But it was
shortly superseded as regards motor accidents by the Road Traffic Act 1934, which
required motor insurers to satisfy any judgment against their insured and restricted
the right of insurers to rely as against third parties on certain categories of policy
exception or on the right of avoidance for non-disclosure or misrepresentation. The
statutory regime has become more elaborate and more comprehensive since 1934,
but the basic framework has not changed.
3. The current legislation is Part VI of the Road Traffic Act 1988. As originally
enacted, it sought to give effect to the first three EEC Motor Insurance Directives,
72/166/EEC, 84/5/EEC and 90/232/EEC. It was subsequently amended by statutory
instruments under the European Communities Act 1972 to reflect the terms of the
Fourth, Fifth and Sixth Motor Insurance Directives 2000/26/EC, 2005/14/EC and
2009/103/EC. The object of the current legislation is to enable the victims of
negligently caused road accidents to recover, if not from the tortfeasor then from his
insurer or, failing that, from a fund operated by the motor insurance industry. Under
section 143 of the Act of 1988 it is an offence to use or to cause or permit any other
person to use a motor vehicle on a road or other public place unless there is in force
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a policy of insurance against third party risks “in relation to the use of the vehicle”
by the particular driver (I disregard the statutory provision for the giving of security
in lieu of insurance). Section 145 requires the policy to cover specified risks,
including bodily injury and damage to property. Section 151(5) requires the insurer,
subject to certain conditions, to satisfy any judgment falling within subsection (2).
This means (omitting words irrelevant to this appeal)
“judgments relating to a liability with respect to any matter
where liability with respect to that matter is required to be
covered by a policy of insurance under section 145 of this Act
and either –
(a) it is a liability covered by the terms of the policy
or security …, and the judgment is obtained against any
person who is insured by the policy … or
(b) it is a liability … which would be so covered if
the policy insured all persons …, and the judgment is
obtained against any person other than one who is
insured by the policy…”
The effect of the latter subsection is that an insurer who has issued a policy in respect
of the use of a vehicle is liable on a judgment, even where it was obtained against a
person such as the driver of the Micra in this case who was not insured to drive it.
The statutory liability of the insurer to satisfy judgments is subject to an exception
under section 152 where it is entitled to avoid the policy for non-disclosure or
misrepresentation and has obtained a declaration to that effect in proceedings begun
within a prescribed time period. But the operation of section 152 is currently under
review in the light of recent decisions of the Court of Justice of the European Union.
4. Under section 145(2), the policy must have been issued by an “authorised
insurer”. This means a member of the Motor Insurers’ Bureau: see sections 95(2)
and 145(5). The Bureau has an important place in the statutory scheme for protecting
the victims of road accidents in the United Kingdom. Following a recommendation
of the Cassell Committee, which reported in 1937 (Cmnd 5528/1937), the Bureau
was created in 1946 to manage a fund for compensating victims of uninsured
motorists. It is a private company owned and funded by all insurers authorised to
write motor business in the United Kingdom. It has entered into agreements with the
Secretary of State to compensate third party victims of road accidents who fall
through the compulsory insurance net even under the enlarged coverage provided
by section 151(2)(b). This means victims suffering personal injury or property
damage caused by (i) vehicles in respect of which no policy of insurance has been
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issued; and (ii) drivers who cannot be traced. These categories are covered by two
agreements with the Secretary of State, the Uninsured Drivers Agreement and the
Untraced Drivers Agreement respectively. The relevant agreement covering Ms
Cameron’s case was the 2003 Untraced Drivers Agreement. It applied to persons
suffering death, bodily injury or property damage arising out of the use of a motor
vehicle in cases where “it is not possible … to identify the person who is or appears
to be liable”: see clause 4(d). The measure of indemnity under this agreement is not
always total. Under clause 10, there is a limit to the Bureau’s liability for legal costs;
and under clause 8 the indemnity for property damage is subject to a modest excess
(at the relevant time £300) and a maximum limit corresponding to the minimum
level of compulsory insurance (at the relevant time £1,000,000). The Bureau
assumes liability under the Uninsured Drivers Agreement in cases where the insurer
has a defence under the provisions governing avoided policies in section 152. But
under article 75 of the Bureau’s articles of association, each insurer binds itself to
meet the Bureau’s liability to satisfy a judgment in favour of the third party in such
cases. In 2017, there were 17,700 concluded applications to the Motor Insurers’
Bureau by victims of untraced drivers.
5. It is a fundamental feature of the statutory scheme of compulsory insurance
in the United Kingdom that it confers on the victim of a road accident no direct right
against an insurer in respect of the underlying liability of the driver. The only direct
right against the insurer is the right to require it to satisfy a judgment against the
driver, once the latter’s liability has been established in legal proceedings. This
reflects a number of features of motor insurance in the United Kingdom which
originated well before the relevant European legislation bound the United Kingdom,
and which differentiate it from many continental systems. In the first place, policies
of motor insurance in the United Kingdom normally cover drivers rather than
vehicles. Section 151(2)(b) of the Act (quoted above) produces a close but not
complete approximation to the continental position. Secondly, the rule of English
insurance law is that an insurer is liable to no one but its insured, even when the
risks insured include liabilities owed by the insured to third parties. Subject to
limited statutory exceptions, the third party has no direct right against the insurer.
Thirdly, even the insured cannot claim against his liability insurer unless and until
his liability has been ascertained in legal proceedings or by agreement or admission.
The Untraced Drivers Agreement assumes that judgment cannot be obtained against
the driver if he cannot be identified, and therefore that no liability will attach to the
insurer in that case. This is why it is accepted as a liability of the Motor Insurance
Bureau. On the present appeal, Ms Cameron seeks to challenge that assumption.
Such a challenge is usually unnecessary. It is cheaper and quicker to claim against
the Bureau. But for reasons which remain unclear, in spite of her counsel’s attempt
to explain them, Ms Cameron has elected not to do that.
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The proceedings
6. Ms Cameron initially sued Mr Hussain for damages. The proceedings were
then amended to add a claim against Liverpool Victoria Insurance for a declaration
that it would be liable to meet any judgment obtained against Mr Hussain. The
insurer served a defence which denied liability on the ground that there was no right
to obtain a judgment against Mr Hussain, because there was no evidence that he was
the driver at the relevant time. Ms Cameron’s response was to apply in the Liverpool
Civil and Family Court to amend her claim form and particulars of claim so as to
substitute for Mr Hussain “the person unknown driving vehicle registration number
Y598 SPS who collided with vehicle registration number KG03 ZJZ on 26 May
2013.” District Judge Wright dismissed that application and entered summary
judgment for the insurer. Judge Parker dismissed Ms Cameron’s appeal. But a
further appeal to the Court of Appeal was allowed by a majority (Gloster and Lloyd
Jones LJJ, Sir Ross Cranston dissenting): [2018] 1 WLR 657.
7. Gloster LJ delivered the leading judgment. She held that the policy of the
legislation was to ensure that the third-party victims of negligent drivers received
compensation from insurers whenever a policy had been issued in respect of the
vehicle, irrespective of who the driver was. In her judgment, the court had a
discretion to permit an unknown person to be sued whenever justice required it.
Justice required it when the driver could not be identified, because otherwise it
would not be possible to obtain a judgment which the issuer of a policy in respect
of the car would be bound to satisfy. The majority considered it to be irrelevant that
Ms Cameron had an alternative right against the Motor Insurance Bureau. She had
a right against the driver and, upon getting judgment against him, against the insurer.
In principle she was entitled to choose between remedies. Sir Ross Cranston
dissented. He agreed that there was a discretion, but he did not consider that justice
required an action to be allowed against the unknown driver when compensation
was available from the Motor Insurance Bureau. Accordingly, the Court of Appeal
(i) gave Ms Cameron permission to amend the claim form so as to sue the driver
under the above description; (ii) directed under CPR 6.15 that service on the insurer
should constitute service on the driver and that further service on the driver should
be dispensed with; and (iii) gave judgment against the driver, as described, recording
in their order that the insurer accepted that it was liable to satisfy that judgment.
Suing unnamed persons
8. Before the Common Law Procedure Act 1852 abolished the practice, it was
common to constitute actions for trespass with fictional parties, generally John (or
Jane) Doe or Roe, in order to avoid the restrictions imposed on possession
proceedings by the forms of action. “Placeholders” such as these were also
occasionally named as parties where the identity of the real party was unknown, a
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practice which subsists in the United States and Canada. After the disappearance of
this practice in England, the extent of any right to sue unnamed persons was
governed by rules of court. The basic rule before 1999 was laid down by the Court
of Appeal in 1926 in Friern Barnet Urban District Council v Adams [1927] 2 Ch
25. The Friern Barnet District Council had a statutory right to recover the cost of
making up Alexandra Road from the proprietors of the adjoining lands, but in the
days before registered title reached Friern Barnet it had no way of discovering who
they were. It therefore began proceedings against a named individual who was not
concerned and “the owners of certain lands adjoining Alexandra Road, … whose
names and addresses are not known to the plaintiffs.” The judge struck out these
words and declined to order substituted service by affixing copies of the writ to posts
on the relevant land. The Court of Appeal dismissed the appeal. They held that there
was no power to issue a writ in this form because the prescribed form of writ required
it to be directed to “C D of, etc in the County of …” (p 30).
9. When the Civil Procedure Rules were introduced in 1999, the function of
prescribing the manner in which proceedings should be commenced was taken over
by CPR Part 7. The general rule remains that proceedings may not be brought against
unnamed parties. This is implicit in the limited exceptions contemplated by the
Rules. CPR 8.2A provides that a practice direction “may set out circumstances in
which a claim form may be issued under this Part without naming a defendant.” It
is envisaged that permission will be required, but that the notice of application for
permission “need not be served on any other person”. However, no such practice
direction has been made. The only express provision made for proceedings against
an unnamed defendant, other than representative actions, is CPR 55.3(4), which
permits a claim for possession of property to be brought against trespassers whose
names are unknown. This is the successor to RSC Order 113, which was introduced
in order to provide a means of obtaining injunctions against unidentifiable squatters,
following the decision of Stamp J in In re Wykeham Terrace, Brighton, Sussex, Ex
p Territorial Auxiliary and Volunteer Reserve Association for the South East [1971]
Ch 204, that they could not be sued if they could not be named. In addition, there
are specific statutory exceptions to broadly the same effect, such as the exception
for proceedings for an injunction to restrain “any actual or apprehended breach of
planning controls” under section 187B of the Town and Country Planning Act 1990.
Section 187B(3) provides that “rules of court may provide for such an injunction to
be issued against a person whose identity is unknown.” The Rules are supplemented
by a practice direction which deals with the administrative steps involved. CPR 7A
PD4.1 provides that a claim form must be headed with the title of the proceedings,
which “should state”, among other things, the “full name of each party”.
10. English judges have allowed some exceptions. They have permitted
representative actions where the representative can be named but some or all of the
class cannot. They have allowed actions and orders against unnamed wrongdoers
where some of the wrongdoers were known so they could be sued both personally
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and as representing their unidentified associates. This technique has been used, for
example, in actions against copyright pirates: see EMI Records Ltd v Kudhail [1985]
FSR 35. But the possibility of a much wider jurisdiction was first opened up by the
decision of Sir Andrew Morritt V-C in Bloomsbury Publishing Group Plc v News
Group Newspapers Ltd [2003] 1 WLR 1633. The claimant in that case was the
publisher of the Harry Potter novels. Copies of the latest book in the series had been
stolen from the printers before publication and offered to the press by unnamed
persons. An injunction was granted in proceedings against “the person or persons
who have offered the publishers of “The Sun”, the “Daily Mail” and the “Daily
Mirror” newspapers a copy of the book Harry Potter and the Order of the Phoenix
by J K Rowling or any part thereof and the person or persons who has or have
physical possession of a copy of the said book or any part thereof without the consent
of the claimants.” The real object of the injunction was to deter newspapers minded
to publish parts of the text, who would expose themselves to proceedings for
contempt of court by dealing with the thieves with notice of the order. The ViceChancellor held that the decision in Friern Barnet Urban District Council v Adams
had no application under the Civil Procedure Rules; that the decision of Stamp J in
In re Wykeham Terrace was wrong; and that the words “should state” in CPR 7A
PD4.1 were not mandatory, but imported a discretion to depart from the practice in
appropriate cases. In his view, a person could be sued by a description, provided that
the description was “sufficiently certain as to identify both those who are included
and those who are not” (para 21).
11. Since this decision, the jurisdiction has regularly been invoked. Judging by
the reported cases, there has recently been a significant increase in its use. The main
contexts for its exercise have been abuse of the internet, that powerful tool for
anonymous wrongdoing; and trespasses and other torts committed by protesters,
demonstrators and paparazzi. Cases in the former context include Brett Wilson LLP
v Persons Unknown [2016] 4 WLR 69 and Smith v Unknown Defendant Pseudonym
“Likeicare” [2016] EWHC 1775 (QB) (defamation); Middleton v Person Unknown
[2016] EWHC 2354 (QB) (theft of information by hackers); PML v Persons
Unknown [2018] EWHC 703 (QB) (hacking and blackmail); CMOC v Persons
Unknown [2017] EWHC 3599 (Comm) (hacking and theft of funds). Cases decided
in the second context include Hampshire Waste Services Ltd v Intending
Trespassers upon Chineham Incinerator Site [2004] Env LR 9; Ineos Upstream Ltd
v Persons Unknown [2017] EWHC 2945 (Ch); UK Oil and Gas Investments Plc v
Persons Unknown [2018] EWHC 2253 (Ch). In some of these cases, proceedings
against persons unknown were allowed in support of an application for a quia timet
injunction, where the defendants could be identified only as those persons who
might in future commit the relevant acts. The majority of the Court of Appeal
followed this body of case law in deciding that an action was permissible against the
unknown driver of the Micra who injured Ms Cameron. This is the first occasion on
which the basis and extent of the jurisdiction has been considered by the Supreme
Court or the House of Lords.
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12. The Civil Procedure Rules neither expressly authorise nor expressly prohibit
exceptions to the general rule that actions against unnamed parties are permissible
only against trespassers. The prescribed forms include a space in which to designate
the claimant and the defendant, a format which is equally consistent with their being
designated by name or by description. The only requirement for a name is contained
in a practice direction. But unlike the Civil Procedure Rules, which are made under
statutory powers, a practice direction is no more than guidance on matters of practice
issued under the authority of the heads of division. As to those matters, it is binding
on judges sitting in the jurisdiction with which it is concerned: Bovale Ltd v
Secretary of State for Communities and Local Government [2009] 1 WLR 2274. But
it has no statutory force, and cannot alter the general law. Whether or not the
requirement of CPR 7A PD4.1 that the claim form “should state” the defendants’
full name admits of a discretion on the point, is not therefore the critical question.
The critical question is what, as a matter of law, is the basis of the court’s jurisdiction
over parties, and in what (if any) circumstances can jurisdiction be exercised on that
basis against persons who cannot be named.
13. In approaching this question, it is necessary to distinguish between two kinds
of case in which the defendant cannot be named, to which different considerations
apply. The first category comprises anonymous defendants who are identifiable but
whose names are unknown. Squatters occupying a property are, for example,
identifiable by their location, although they cannot be named. The second category
comprises defendants, such as most hit and run drivers, who are not only anonymous
but cannot even be identified. The distinction is that in the first category the
defendant is described in a way that makes it possible in principle to locate or
communicate with him and to know without further inquiry whether he is the same
as the person described in the claim form, whereas in the second category it is not.
14. This appeal is primarily concerned with the issue or amendment of the claim
form. It is not directly concerned with its service, which occurs under the rules up
to four months after issue, subject to extension by order of the court. There is no
doubt that a claim form may be issued against a named defendant, although it is not
yet known where or how or indeed whether he can in practice be served. But the
legitimacy of issuing or amending a claim form so as to sue an unnamed defendant
can properly be tested by asking whether it is conceptually (not just practically)
possible to serve it. The court generally acts in personam. Although an action is
completely constituted on the issue of the claim form, for example for the purpose
of stopping the running of a limitation period, the general rule is that “service of
originating process is the act by which the defendant is subjected to the court’s
jurisdiction”: Barton v Wright Hassall LLP [2018] 1 WLR 1119, para 8. The court
may grant interim relief before the proceedings have been served or even issued, but
that is an emergency jurisdiction which is both provisional and strictly conditional.
In Dresser UK Ltd v Falcongate Freight Management Ltd [1992] QB 502, the Court
of Appeal held that, for the purposes of the Brussels Convention (the relevant
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provisions of the Brussels Regulation are different), an English court was “seised”
of an action when the writ was served, not when it was issued. This was because of
the legal status of an unserved writ in English law. Bingham LJ described that status,
at p 523, as follows:
“it is in my judgment artificial, far-fetched and wrong to hold
that the English court is seised of proceedings, or that
proceedings are decisively, conclusively, finally or definitively
pending before it, upon mere issue of proceedings, when at that
stage (1) the court’s involvement has been confined to a
ministerial act by a relatively junior administrative officer; (2)
the plaintiff has an unfettered choice whether to pursue the
action and serve the proceedings or not, being in breach of no
rule or obligation if he chooses to let the writ expire unserved;
(3) the plaintiff’s claim may be framed in terms of the utmost
generality; (4) the defendant is usually unaware of the issue of
proceedings and, if unaware, is unable to call on the plaintiff to
serve the writ or discontinue the action and unable to rely on
the commencement of the action as a lis alibi pendens if
proceedings are begun elsewhere; (5) the defendant is not
obliged to respond to the plaintiff’s claim in any way, and not
entitled to do so save by calling on the plaintiff to serve or
discontinue; (6) the court cannot exercise any powers which,
on appropriate facts, it could not have exercised before issue;
(7) the defendant has not become subject to the jurisdiction of
the court.”
The case was decided under the Rules of the Supreme Court. But Bingham LJ’s
statement would be equally true (mechanics and terminology apart) of an unserved
claim form under the Civil Procedure Rules.
15. An identifiable but anonymous defendant can be served with the claim form
or other originating process, if necessary by alternative service under CPR 6.15. This
is because it is possible to locate or communicate with the defendant and to identify
him as the person described in the claim form. Thus, in proceedings against
anonymous trespassers under CPR 55.3(4), service must be effected in accordance
with CPR 55.6 by attaching copies of the documents to the main door or placing
them in some other prominent place on the land where the trespassers are to be
found, and posting them if practical through the letter box. In Brett Wilson LLP v
Persons Unknown, supra, alternative service was effected by email to a website
which had published defamatory matter, Warby J observing (para 11) that the
relevant procedural safeguards must of course be applied. In Smith v Unknown
Defendant Pseudonym “Likeicare”, supra, Green J made the same observation (para
11) in another case of internet defamation where service was effected in the same
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way. Where an interim injunction is granted and can be specifically enforced against
some property or by notice to third parties who would necessarily be involved in
any contempt, the process of enforcing it will sometimes be enough to bring the
proceedings to the defendant’s attention. In Bloomsbury Publishing Group, for
example, the unnamed defendants would have had to identify themselves as the
persons in physical possession of copies of the book if they had sought to do the
prohibited act, namely disclose it to people (such as newspapers) who had been
notified of the injunction. The Court of Appeal has held that where proceedings were
brought against unnamed persons and interim relief was granted to restrain specified
acts, a person became both a defendant and a person to whom the injunction was
addressed by doing one of those acts: South Cambridgeshire District Council v
Gammell [2006] 1 WLR 658, para 32. In the case of anonymous but identifiable
defendants, these procedures for service are now well established, and there is no
reason to doubt their juridical basis.
16. One does not, however, identify an unknown person simply by referring to
something that he has done in the past. “The person unknown driving vehicle
registration number Y598 SPS who collided with vehicle registration number KG03
ZJZ on 26 May 2013”, does not identify anyone. It does not enable one to know
whether any particular person is the one referred to. Nor is there any specific interim
relief such as an injunction which can be enforced in a way that will bring the
proceedings to his attention. The impossibility of service in such a case is due not
just to the fact that the defendant cannot be found but to the fact that it is not known
who the defendant is. The problem is conceptual, and not just practical. It is true that
the publicity attending the proceedings may sometimes make it possible to speculate
that the wrongdoer knows about them. But service is an act of the court, or of the
claimant acting under rules of court. It cannot be enough that the wrongdoer himself
knows who he is.
17. This is, in my view, a more serious problem than the courts, in their more
recent decisions, have recognised. Justice in legal proceedings must be available to
both sides. It is a fundamental principle of justice that a person cannot be made
subject to the jurisdiction of the court without having such notice of the proceedings
as will enable him to be heard. The principle is perhaps self-evident. The clearest
statements are to be found in the case law about the enforcement of foreign
judgments at common law. The English courts will not enforce or recognise a
foreign judgment, even if it has been given by a court of competent jurisdiction, if
the judgment debtor had no sufficient notice of the proceedings. The reason is that
such a judgment will have been obtained in breach of the rules of natural justice
according to English notions. In his celebrated judgment in Jacobson v Frachon
(1927) 138 LT 386, 392, Atkin LJ, after referring to the “principles of natural
justice” put the point in this way:
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“Those principles seem to me to involve this, first of all that the
court being a court of competent jurisdiction, has given notice
to the litigant that they are about to proceed to determine the
rights between him and the other litigant; the other is that
having given him that notice, it does afford him an opportunity
of substantially presenting his case before the court.”
Lord Atkin’s principle is reflected in the statutory provisions for the recognition of
foreign judgments in section 9(2)(c) of the Administration of Justice Act 1920 and
section 8(1) and (2) of the Foreign Judgments (Reciprocal Enforcement) Act 1933,
as well as in article 45(1)(b) of the Brussels I Regulation (Recast), Regulation (EU)
No 1215/2012.
18. It would be ironic if the English courts were to disregard in their own
proceedings a principle which they regard as fundamental to natural justice as
applied to the proceedings of others. In fact, the principle is equally central to
domestic litigation procedure. Service of originating process was required by the
practice of the common law courts long before statutory rules of procedure were
introduced following the Judicature Acts of 1873 and 1875. The first edition of the
Rules of the Supreme Court, which was promulgated in 1883, required personal
service unless an order was made for what was then called substituted (now
alternative) service. Subsequent editions of the rules allowed for certain other modes
of service without a special order of the court, notably in the case of corporations,
but every mode of service had the common object of bringing the proceedings to the
attention of the defendant. In Porter v Freudenberg [1915] 1 KB 857 a specially
constituted Court of Appeal, comprising the Lord Chief Justice, the Master of the
Rolls and all five Lords Justices of the time, held that substituted service served the
same function as personal service and therefore had to be such as could be expected
to bring the proceedings to the defendant’s attention. The defendants in that case
were enemy aliens resident in Germany during the First World War. Lord Reading
CJ, delivering the judgment of the court, said at p 883:
“Once the conclusion is reached that the alien enemy can be
sued, it follows that he can appear and be heard in his defence
and may take all such steps as may be deemed necessary for
the proper presentment of his defence. If he is brought at the
suit of a party before a court of justice he must have the right
of submitting his answer to the court. To deny him that right
would be to deny him justice and would be quite contrary to
the basic principles guiding the King’s courts in the
administration of justice.”
It followed, as he went on to observe at pp 887-888, that the court must
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“take into account the position of the defendant the alien
enemy, who is, according to the fundamental principles of
English law, entitled to effective notice of the proceedings
against him. … In order that substituted service may be
permitted, it must be clearly shown that the plaintiff is in fact
unable to effect personal service and that the writ is likely to
reach the defendant or to come to his knowledge if the method
of substituted service which is asked for by the plaintiff is
adopted.”
The principle stated in Porter v Freudenberg was incorporated in the Rules of the
Supreme Court in the revision of 1962 as RSC Order 67, rule 4(3). This provided:
“Substituted service of a document, in relation to which an
order is made under this rule, is effected by taking such steps
as the court may direct to bring the document to the notice of
the person to be served.”
This provision subsequently became RSC Order 65, rule 4(3), and continued to
appear in subsequent iterations of the Rules until they were superseded by the Civil
Procedure Rules in 1999.
19. The treatment of the principle in the more recent authorities is, unfortunately,
neither consistent nor satisfactory. The history may be summarised as follows:
(1) Murfin v Ashbridge [1941] 1 All ER 231 arose out of a road accident
caused by the alleged negligence of a driver who was identified but could not
be found. The case is authority for the proposition that while an insurer may
be authorised by the policy to defend an action on behalf of his assured, he
was not a party in that capacity and could not take any step in his own name.
In the course of considering that point, Goddard LJ suggested at p 235 that
“possibly” service on the driver might have been effected by substituted
service on the insurers. Porter v Freudenberg was cited, but the point does
not appear to have been argued.
(2) In Gurtner v Circuit [1968] 2 QB 587, the driver alleged to have been
responsible for a road accident had emigrated and could not be traced. He
was thought to have been insured, but it was impossible to identify his
insurer. The plaintiff was held not to be entitled to an order for substituted
service on another insurer who had no relationship with the driver. Lord
Denning MR thought (pp 596-597) that the affidavit in support of the
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application was defective because it failed to state that the writ, if served on
a non-insurer, was likely to reach the defendant. But he suggested that
substituted service might have been effected on the real insurer if it had been
identified. Diplock LJ thought (p 605) that it might have been effected on the
Motor Insurers’ Bureau. Porter v Freudenberg was not cited, and the point
does not appear to have been argued.
(3) In Clarke v Vedel [1979] RTR 26, the question was fully argued by
reference to all the relevant authorities in the context of the Road Traffic
Acts. A person had stolen a motor cycle, collided with the plaintiffs, given a
fictitious name and address and then disappeared. He was sued under the
fictitious name he had given, and an application was made for substituted
service on the Motor Insurance Bureau. The affidavit in support
understandably failed to state that that mode of service could be expected to
reach the driver. The Court of Appeal proceeded on the assumption (p 32)
that there was “no more reason to suppose that [the writ] will come to his
notice or knowledge by being served on the Motor Insurance Bureau than by
being served on any one else in the wide world.” But it declined to treat the
dicta in the above cases as stating the law. Stephenson LJ considered (p 36),
on the strength of the dicta in Murfin v Ashbridge and Gurtner v Circuit, that
“there may be cases where a defendant, who cannot be traced
and, therefore, is unlikely to be reached by any form of
substituted service, can nevertheless be ordered to be served at
the address of insurers or the Bureau in a road accident case.
The existence of insurers and of the Bureau and of these various
agreements does create a special position which enables a
plaintiff to avoid the strictness of the general rule and obtain
such an order for substituted service in some cases.”
But he held (p 37) that
“This is a case in which, on the face of it, substituted service
under the rule is not permissible and the affidavit supporting
the application for it is insufficient. This fictitious, or, at any
rate, partly fictitious defendant cannot be served, so Mr
Crowther is right in saying that he cannot be sued … I do not
think that Lord Denning MR or Diplock LJ or Salmon LJ or
Goddard LJ had anything like the facts of this case in mind; and
whatever the cases in which the exception to the general rule
should be applied, in my judgment this is not one of them.”
Page 14
In his concurring judgment, Roskill LJ (pp 38-39) approved the statement in
the then current edition of the Supreme Court Practice that “[t]he steps which
the court may direct in making an order for substituted service must be taken
to bring the document to the notice of the person to be served,” citing Porter
v Freudenberg in support of it.
(4) 20 years later, another division of the Court of Appeal reached the
opposite conclusion in Abbey National Plc v Frost (Solicitors’ Indemnity
Fund Ltd intervening) [1999] 1 WLR 1080. The issue was the same, except
that the defendant was a solicitor insured by the Solicitors Indemnity Fund
pursuant to a scheme managed by the Law Society under the compulsory
insurance provisions of the Solicitors Act 1974. The claimant sued his
solicitor, who had absconded and could not be found. The Court of Appeal
made an order for substituted service on the Fund. Nourse LJ (with whom
Henry LJ and Robert Walker LJ agreed) distinguished Porter v Freudenberg
on the ground that it was based on the practice of the masters of the Supreme
Court recorded in the White Book at the time; and Clarke v Vedel on the
ground that the policy of the statutory solicitors’ indemnity rules required a
right of substituted service on an absconding solicitor. RSC Order 65, rule
4(3) was held to be purely directory and not to limit the discretion of the court
as to whether or in what circumstances to order substituted service. Nourse
LJ held that RSC Order 65 did not require that the order should be likely to
result in the proceedings coming to the defendants’ attention.
20. The current position is set out in Part 6 of the Civil Procedure Rules. CPR 6.3
provides for service by the court unless the claimant elects to effect service himself.
It considerably broadens the permissible modes of service along lines recommended
by Lord Woolf’s reports on civil justice. But the object of all the permitted modes
of service, as his final report made clear, was the same, namely to enable the court
to be “satisfied that the method used either had put the recipient in a position to
ascertain its contents or was reasonably likely to enable him to do so within any
relevant time period”: see Access to Justice, Final Report (1996), Ch 12, para 25.
CPR 6.15, which makes provision for alternative service, provides, so far as
relevant:
“6.15(1) Where it appears to the court that there is a good
reason to authorise service by a method or at a place not
otherwise permitted by this Part, the court may make an order
permitting service by an alternative method or at an alternative
place.
(2) On an application under this rule, the court may order
that steps already taken to bring the claim form to the attention
Page 15
of the defendant by an alternative method or at an alternative
place is good service.”
CPR 6.15 does not include the provision formerly at RSC Order 65, rule 4(3). But it
treats alternative service as a mode of “service”, which is defined in the indicative
glossary appended to the Civil Procedure Rules as “steps required by rules of court
to bring documents used in court proceedings to a person’s attention.” Moreover,
sub-paragraph (2) of the rule, which is in effect a form of retrospective alternative
service, envisages in terms that the mode of service adopted will have had that effect.
Applying CPR 6.15 in Abela v Baadarani [2013] 1 WLR 2043 Lord Clarke of Stonecum-Ebony (with whom the rest of this court agreed) held (para 37) that “the whole
purpose of service is to inform the defendant of the contents of the claim form and
the nature of the claimant’s case.” The Court of Appeal appears to have had no
regard to these principles in ordering alternative service of the insurer in the present
case.
21. In my opinion, subject to any statutory provision to the contrary, it is an
essential requirement for any form of alternative service that the mode of service
should be such as can reasonably be expected to bring the proceedings to the
attention of the defendant. Porter v Freudenberg was not based on the niceties of
practice in the masters’ corridor. It gave effect to a basic principle of natural justice
which had been the foundation of English litigation procedure for centuries, and still
is. So far as the Court of Appeal intended to state the law generally when it observed
in Abbey National Plc v Frost that service need not be such as to bring the
proceedings to the defendant’s attention, I consider that they were wrong. An
alternative view of that case is that that observation was intended to apply only to
claims under schemes such as the solicitors’ compulsory insurance scheme, where
it was possible to discern a statutory policy that the public should be protected
against defaulting solicitors. If so, the reasoning would apply equally to the
compulsory insurance of motorists under the Road Traffic Acts, as indeed the Court
of Appeal held in the present case. That would involve a narrower exception to the
principle of natural justice to which I have referred, and I do not rule out the
possibility that such an exception might be required by other statutory schemes. But
I do not think that it can be justified in the case of the scheme presently before us.
22. In the first place, the Road Traffic Act scheme is expressly based on the
principle that as a general rule there is no direct liability on the insurer, except for
its liability to meet a judgment against the motorist once it has been obtained. To
that extent, Parliament’s intention that the victims of negligent motorists should be
compensated by the insurer is qualified. No doubt Parliament assumed, when
qualifying it in this way, that other arrangements would be made which would fill
the compensation gap, as indeed they have been. But those arrangements involve
the provision of compensation not by the insurer but by the Motor Insurers’ Bureau.
The availability of compensation from the Bureau makes it unnecessary to suppose
Page 16
that some way must be found of making the insurer liable for the underlying wrong
when his liability is limited by statute to satisfying judgments.
23. Secondly, ordinary service on the insurer would not constitute service on the
driver, unless the insurer had contractual authority to accept service on the driver’s
behalf or to appoint solicitors to do so. Such provisions are common in liability
policies. I am prepared to assume that the policy in this case conferred such authority
on the insurer, although we have not been shown it. But it could only have conferred
authority on behalf of the policy-holder (if he existed), and it is agreed that the driver
of the Micra was not the policy holder. Given its contingent liability under section
151 of the Road Traffic Act 1988, the insurer no doubt has a sufficient interest to
have itself joined to the proceedings in its own right, if it wishes to be. That would
authorise the insurer to make submissions in its own interest, including submissions
to the effect that the driver was not liable. But it would not authorise it to conduct
the defence on the driver’s behalf. The driver, if sued in these proceedings, is entitled
to be heard in his own right.
24. Thirdly, it is plain that alternative service on the insurer could not be expected
to reach the driver of the Micra. It would be tantamount to no service at all, and
should not therefore have been ordered unless the circumstances were such that it
would be appropriate to dispense with service altogether.
25. There is a power under CPR 6.16 “to dispense with service of a claim form
in exceptional circumstances.” It has been exercised on a number of occasions and
considered on many more. In general, these have been cases in which the claimant
has sought to invoke CPR 6.16 in order to escape the consequences of some
procedural mishap in the course of attempting to serve the claim form by one of the
specified methods, or to confer priority on the English court over another forum for
the purpose of the Brussels Regulation, or to affect the operation of a relevant
limitation period. In all of them, the defendant or his agents was in fact aware of the
proceedings, generally because of a previous attempt by the claimant to serve them
in a manner not authorised by the Rules. As Mummery LJ observed, delivering the
judgment of the Court of Appeal in Anderton v Clwyd County Council (No 2) [2002]
1 WLR 3174, para 58, service was dispensed with because there was “no point in
requiring him to go through the motions of a second attempt to complete in law what
he has already achieved in fact.” In addition, I would accept that it may be
appropriate to dispense with service, even where no attempt has been made to effect
it in whatever manner, if the defendant has deliberately evaded service and cannot
be reached by way of alternative service under CPR 6.15. This would include cases
where the defendant is unidentifiable but has concealed his identity in order to evade
service. However, a person cannot be said to evade service unless, at a minimum,
he actually knows that proceedings have been or are likely to be brought against
him. A court would have to be satisfied of that before it could dispense with service
on that basis. An inference to that effect may be easier to draw in the case of hit and
Page 17
run drivers, because by statute drivers involved in road accidents causing personal
injury or damage to another vehicle must either “stop and, if required to do so by
any person having reasonable grounds for so requiring, give his name and address
and also the name and address of the owner and the identification marks of the
vehicle”, or else report the incident later. But the mere fact of breach of this duty
will not necessarily be enough, for the driver may be unaware of his duty or of the
personal injury or damage or of his potential liability. No submission was made to
us that we should treat this as a case of evasion of service, and there are no findings
which would enable us to do so. I would not wish arbitrarily to limit the discretion
which CPR 6.16 confers on the court, but I find it hard to envisage any circumstances
in which it could be right to dispense with service of the claim form in circumstances
where there was no reason to believe that the defendant was aware that proceedings
had been or were likely to be brought. That would expose him to a default judgment
without having had the opportunity to be heard or otherwise to defend his interests.
It is no answer to this difficulty to say that the defendant has no reason to care
because the insurer is bound to satisfy a judgment against him. If, like the driver of
the Micra, the motorist was not insured under the policy, he will be liable to
indemnify the insurer under section 151(8) of the Road Traffic Act. It must be
inherently improbable that he will ever be found or, if found, will be worth pursuing.
But the court cannot deny him an opportunity to be heard simply because it thinks
it inherently improbable that he would take advantage of it.
26. I conclude that a person, such as the driver of the Micra in the present case,
who is not just anonymous but cannot be identified with any particular person,
cannot be sued under a pseudonym or description, unless the circumstances are such
that the service of the claim form can be effected or properly dispensed with.
The European law issue
27. Mr Williams QC, who appeared for Ms Cameron, submitted that this result
was inconsistent with the Sixth Motor Insurance Directive 2009/103/EC, and that
the Road Traffic Act 1988 should be read down so as to conform with it. The
submission was pressed with much elaboration, but it really boils down to two
points. First, Mr Williams submits that the Directive requires a direct right against
the insurer on the driver’s underlying liability, and not simply a requirement to have
the insurer satisfy a judgment against the driver. Secondly, he submits that recourse
to the Motor Insurers’ Bureau is not treated by the Directive as an adequate
substitute. Neither point appears to have been raised before the Court of Appeal, for
there is no trace of them in the judgments. Before us, they emerged as Mr Williams’
main arguments. I propose, however, to deal with them quite shortly, because I think
it clear that no point on the Directive arises.
Page 18
28. Article 3 of the Directive requires member states to ensure that civil liability
in respect of the use of vehicles is covered by insurance, and article 9 lays down
minimum amounts to be insured. Recital 30 states:
“The right to invoke the insurance contract and to claim against
the insurance undertaking directly is of great importance for the
protection of victims of motor vehicle accidents … In order to
facilitate an efficient and speedy settlement of claims and to
avoid as far as possible costly legal proceedings, a right of
direct action against the insurance undertaking covering the
person responsible against civil liability should be extended to
victims of any motor vehicle accident.”
Effect is given to this objective by article 18, which provides:
“Article 18
Direct Right of Action
Member states shall ensure that any party injured as a result of
an accident caused by a vehicle covered by insurance as
referred to in article 3 enjoys a direct right of action against the
insurance undertaking covering the person responsible against
civil liability.”
29. I assume (without deciding) that article 18 requires a direct right of action
against the insurer in respect of the underlying wrong of the “person responsible”
and not just a liability to satisfy judgments entered against that person. It is a
plausible construction in the light of the recital and the reference to Directive
2000/26/EC. However, Ms Cameron is not trying in these proceedings to assert a
direct right against the insurer for the underlying wrong. Her claim against the
insurer is for a declaration that it is liable to meet any judgment against the driver of
the Micra. Her claim against the driver is for damages. But the right that she asserts
against him on this appeal is a right to sue him without identifying him or observing
rules of court designed to ensure that he is aware of the proceedings. Nothing in the
Directive requires the United Kingdom to recognise a right of that kind. Indeed, it
is questionable whether it would be consistent with article 47 of the Charter of
Fundamental Rights regarding the fairness of legal proceedings.
30. Mr Williams’ second point is in reality a reiteration of the first. It is based on
article 10 of the Directive, which requires member states to ensure that there is a
Page 19
“national bureau” charged to pay compensation for “damage to property or personal
injuries caused by an unidentified vehicle or a vehicle for which the insurance
obligation provided for in article 3 has not been satisfied.” The submission is that
the Directive requires that recourse to the Bureau, as the relevant body in the United
Kingdom, should be unnecessary in a case like this, because the Micra was
identified. It was only the driver who was unidentified. This is in effect a complaint
that the indemnity available from the Motor Insurers’ Bureau under the Untraced
Drivers Agreement, which extends to untraced drivers whether or not the vehicle is
identified, is wider than the Directive requires. In reality, the complaint is not about
the extent of the Bureau’s coverage, which unquestionably extends to this case. The
complaint is that it is the Bureau which is involved and not the insurer. But that is
because the insurer is liable only to satisfy judgments, which is Mr Williams’ first
point. It is true that the measure of the Bureau’s indemnity is slightly smaller than
that of the insurer (because of the excess for property damage and the limited
provision for costs). But in that respect it is consistent with the Directive.
Disposal
31. I would allow the appeal, set aside the order of the Court of Appeal, and
reinstate that of District Judge Wright.