Clearing the Rome II hurdle

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7th January 2015

Clearing the Rome II hurdle

The question of which country’s laws apply to a personal injury claim is not as simple as it seems, explains Sophie Robson

Picture the scenario: you suffer an unfortunate accident while overseas and, having decided to bring a personal injury claim against the person responsible, you are then faced with the none-too-straightforward question of which country’s laws will apply. One might naturally assume that the applicable law is automatically and without exception that of the country in which you were injured, and that a claim can only be brought in that jurisdiction. As with many aspects of the law, however, it is not quite as simple as that.

Escape clause

Most of us will be familiar with the basic concept of regulation 864/2007 (better known as Rome II), if not the nitty-gritty detail. Essentially, article 4(1) of the regulation lays down the general rule that the applicable law in tort is the law of the country in which the damage occurs. So far, so simple. However, articles 4(2) and 4(3) provide crucially important ways in which this general rule can be circumvented. Article 4(2) states that if both the injured party and the tortfeasor are ‘habitually resident’ in the same country, the laws of that country will apply. Generally, the question of habitual residence is (relatively) easily answered. More complicated is article 4(3), which dictates that the laws of another country (other than the one where the injury occurred) can apply if a ‘manifestly closer connection’ with that country can be demonstrated. While this ‘escape clause’ may seem attractive to claimants wishing to pursue their claim in their home country, case law suggests that the courts will scrutinise each case in great detail and, as Justice Slade recently commented in Winrow v Hemphill and another [2014] EWHC 3164 (QB), the provisions of Rome II present a ‘high hurdle’ to be cleared. And it makes a difference to the outcome of the case: the question of which country’s laws apply can affect liability, quantum and limitation.

Manifestly closer connection

In Winrow, the claimant (W) was injured in a car accident while living with her family in Germany. W argued that English law should apply due to a ‘manifestly closer’ connection with England, and submitted that both parties were habitually resident in England at the time of the accident (the defendant was also an English national living in Germany). She failed on both counts. In terms of article 4(2), W and her family had lived in Germany for over eight years before the accident and remained there for 18 months afterwards. There was no evidence that they had retained a house in England during this time. As for the claim of a manifestly closer connection with England, the court held that this was defeated by the location of the accident, the fact that W received treatment in Germany and the fact that both she and the tortfeasor were habitually resident in Germany. The case demonstrates that even if a significant amount of the losses are suffered back in England, this will by no means automatically displace the general rule.

Another case highlighting the difficulty of clearing the Rome II hurdle is Stylianou v Toyoshima and another [2013] EWHC 2188 (QB). The claimant (S) was rendered tetraplegic by a car accident whileholidaying in Western Australia, but even though the accident did not occur in Europe, Rome II still applied because a cause of action was brought in the UK. While the court allowed S to bring a claim for assessment of damages in England, it held that the applicable law was that of Western Australia, which was a disadvantage to S as the 6 per cent discount rate in Western Australia meant she would receive significantly less in damages than under English law. Although it was acknowledged that all S’s losses would be felt in England, that all material witnesses relevant to the damages claim were based in this country and that the defendant (a Japanese national) had no connection to Western Australia, the judge decided at an interlocutory hearing that Western Australian law applied. He was particularly mindful of the unusual fact that proceedings had originally been issued in Western Australia two and a half years previously, and the need for certainty when interpreting Rome II.

Both cases under articles 4(2) and 4(3) bring a measure of increased certainty to the interpretation of Rome II – even though some may consider the decision to apply Australian law to the assessment of damages in Stylianou harsh. The cases also confirm just how difficult it will be to clear the article 4(3) hurdle.