8.4 Chapter 4: the partjes the injured party can access

First, the definition of injured party in the Directive is analysed: to whom does the term refer? There are several reasons for this discussion. It is concluded that the Dutch version of the Directive uses different terms in different articles to refer to the persons to be protected. This poses the question whether or not the Directive intends to distinguish between, for example, injured parties in the broad sense (those who suffered a loss due to a vehicle), direct injured parties and their dependents and social and private insurers with a right of recourse. Based on a comparison of the Dutch text with other versions of the Directive (French, German and English), it is concluded that the Directive does not intend to make such a distinction in general and that the Dutch text of the Directive is confusing in this regard.

However, the Directive does treat different categories of 'injured parties' differently. Certain (natural and legal) persons who have suffered damages as a result of an accident they were not directly involved in (such as private and social insurance institutions having a right of recourse), can, for example, be excluded from access to the guarantee fund or the compensation body by national legislation.

To provide a broad overview, I describe in general terms the parties the injured party has, depending on the circumstances, access to. This analysis is complemented by four 'decision diagrams', which the reader may find helpful to identity the parties the injured party can present his claim to.

The claim against the insurer is first examined. It is concluded that the term 'injured party' has the broadest meaning in relation to the insurer. Next, the direct right of action of Article 18 of the Directive is analysed, whereby the classic action directe (which (only) means that the injured third party has the ius agendi) is compared with the concept of the injured party's 'right of his own' (as stipulated by, for example, Article 6 Wam). It is argued that the direct right of action of Article 18 of the Directive has the characteristics of 'a right of his own', because the injured party can, under certain circumstances, enforce claims against the insurer that are not available to the liable insured person.

In the context of an analysis of the laws governing the 'direct right of action' both the regime of the Convention on the law applicable to traffic accidents 1971 (the Hague Convention) and the regime of the Rome II Regulation are reviewed. It is argued that the Rome II Regulation gives the injured party the choice between the law applicable to the non-contractual obligation and the law governing the insurance contract. The Hague Convention does not allow for such a choice.

Subsequently, the question which courts have jurisdiction to hear the claim from the injured party against the insurer is discussed, including a detailed analysis of the ruling of the CJEC in FBTO/Jack Odenbreit. It follows from this ruling that the injured party can summon the insurer against which he has a direct right of action before the courts of his own residence. In a subsequent ruling by the CJEC, in Vorarlberger Gebietskrankenkasse, the question was raised whether this option is also available to a social insurance institution having a right of recourse. The Court ruled that this option is not available to 'injured parties' that cannot be deemed economically weak. The Court holds that Article 11, second paragraph of the Brussels I Regulation, as an exception to the main rule that persons with a domicile in the EU can only be summoned to appear before a court in their own Member State, must be interpreted restrictively. It is unclear which parties should be deemed 'not economically weak'. To that extent, the ruling does not achieve the high degree of predictability of the rules of jurisdiction that, given its ruling, the Court appears to deem so important.

In the context of the international accident, I first examine the claims of the injured party resulting from an accident with a visiting motorist. This injured party can in principle apply to the Bureau. In this case, injured parties are the same as the persons having a claim against the insurer.

The conditions under which the Bureau can be held liable are discussed. In this context a distinction is made between the green card (the international insurance certificate) as a basis for claim settlement and the rights against the Bureau based on the Pact that the liable vehicle is normally based in a country whose Bureau has signed the Multilateral Agreement.

The first area of discussion concerns the requirements a green card must meet if it is to be accepted as a basis for claim settlement by the Bureau of the country of the accident, and guaranteed by the Bureau under whose authority it was issued. I distinguish in this respect between formal aspects on the one hand and form and content on the other hand. With regard to the formal aspects, the question which insurers are authorised to issue green cards to their insured, and to which insured's green cards may be issued are discussed. Under form and content of the IVB, the model of the green card is discussed in detail, paying attention to, among other things, the question of the consequences of changes in the model of the green card and the validity of green cards not yet adapted to the new model. This is followed by a discussion of the rules with regard to guarantees in case of false and unauthorised or illegally altered green cards. I subsequently explain how the injured party can prove that the liable person had a green card that was valid at the time of the accident and in the country of the accident.

It is established that neither the EU rules, nor - insofar as Dutch law is concerned - national legislation provides specific indications for the interpretation of the term 'valid' green card. I argue that in the absence of such rules, where appropriate, the court should base itself on the agreements between the Bureaux, although these agreements obviously do not bind third parties directly.

I then discuss under what circumstances the Bureaux accept responsibility for accidents under the term 'normally based'. In such cases, a green card, if one was issued, is irrelevant to the claim settlement. I discuss the term 'territory of a Member State in which the vehicle is normally based' in the Directive, and pay extensive attention to the situation in which - briefly stated - the registration plate of the liable vehicle is defective, in the sense that it does not, or does no longer correspond to the vehicle. I investigate case law of the CJEC from the 1980s and 1990s (cases Gambetta, BCF, and Fournier) and conclude that the broad interpretation given to the term 'not or no longer corresponding' by the European Commission after the adoption of the 5th Directive has made these rulings obsolete, but leads to unsatisfactory results. I therefore argue that the provision of Article 1, paragraph 4, letter d) of the Directive should be amended to the effect that the Toss should be borne by the Bureau (and therefore the insurance market) of the Member State where the responsible vehicle, not or no longer carrying a corresponding registration plate, was last official normally based, i.e. was registered in conformity with the applicable legal requirements.

Analogous to the question of how the injured party can prove that the liable person has a valid green card, I discuss how he can prove that a vehicle is normally based in the territory of a certain Member State. I argue that only the correct and fully registered registration number can serve as proof.

An important aspect of my discussion of the claim of the injured party against the Bureau is its legal basis. The agreements between the Bureaux - the Agreement between Member Bureaux of the Council of Bureaux (the agreement in which the green card is the basis for the claim) and the Multilateral Agreement (within the framework of the liability based on the concept 'normally based') - and the Internal Regulations (the standard conditions outlining the rights and obligations of the Bureaux) provide this basis. It is first noted that, in all the countries participating in the green card system, the law stipulates that the injured party has a direct right of action against the Bureau. After examination of a number of views defended in the literature on the construction of the green card system, I put forward my own view that the most satisfactory explanation is that of a guarantee provided by the 'handling' Bureau (the Bureau of the country of the accident) itself that it will settle the damages with the injured party, supported by a guarantee of the guaranteeing Bureau that it will reimburse the outlays of the 'handling' Bureau (and a handling fee). This construction fits well with the situation in which the green card is the basis for claim settlement and with the situation in which the term 'normally based' is the basis.

A second relevant question regards the competent courts to hear a case against the Bureau. I take the position that a claim against the Bureau cannot be based on the section of Brussels I Regulation that is applicable to matters relating to insurance. After briefly discussing the law applicable to the claim against the Bureau, I conclude that the Bureau is not an insurance undertaking within the meaning of this Regulation and that it can be compared to a guarantee fund.

As the Hague Convention 1971 does not apply to claims against public guarantee funds, it is argued that it does not apply to the Bureau either. This means that the claim against the Bureau is governed by the Rome II Regulation. The injured party does not have a choice between the law applicable to non-contractual obligations and the law applicable to the insurance contract, since the obligations of the Bureau are not based on an insurance contract and the Bureau is not an insurer. The question of the competence of the courts with regard to proceedings against the Bureau is therefore governed by the law of the country of the accident.

The 'nominated correspondent' is a very important ligure in practice: the majority of the cases settied under the green card scheme are dealt with by correspondents. I term the correspondent a servant of two masters: he is the agent of the insurer at whose request he was appointed and the authorised representative of the Bureau of the country where he works and that approved his appointment. This position entails that the agent relationship between the correspondent and the insurer cannot contain elements that conflict with the principles of the green card system. This means that the correspondent must interpret the applicable law independently and without instructions from the insurer and that he must compensate the injured party himself and not wait until the insurer has transferred the necessary funds to him. The possibility is also considered that the correspondent is himself in any way involved in the claim, either pursuant to Selbsteintritt, or because he has a conflict of interest as he also represents the injured party. According to Dutch civil law, he forfeits his entitlement to a salary in the Jatter case.

Legal proceedings have to be started against the Bureau, not the correspondent who is merely the representative of the Bureau.

The second entity that the victim of a visiting motorist can direct his claim to is, under certain conditions, the guarantee fund. The guarantee fund comes into view (a) when the liable motor vehicle driver is not in possession of the necessary green card. (b) if the liable vehicle is normally based in a Member State, but the registration plate of the vehicle does not or no longer correspond to the vehicle (in other words where the vehicle fails to carry a registration plate, or where it carries a false, suspended, withdrawn or expired registration plate), or (c) when the liable vehicle is exempted from compulsory insurance under Article 5, second paragraph, in the Member State in whose territory it is normally based.

I then discuss under what circumstances the Directive provides the injured party with a claim against the guarantee fund. These claims are not limited to the victim of an accident caused by a visiting vehicle, but also apply in case of a purely 'national' accident. The injured party must have the right to apply to the guarantee fund if the liable person is either unknown or uninsured. With regard to exempted vehicles under Article 5, second paragraph of the Directive, I conclude that the Directive provides the victim of an accident with a visiting exempted vehicle with a claim against the guarantee fund of the Member State of the accident. However it would have been more logical to let the Bureau act as guarantor for (insured and) uninsured vehicles normally based in another Member State. It has to be borne in mind that the exempted vehicle is normally based in a Member State other than that of the accident and according to the basic principles governing international claim settlement, in such cases the Bureau would be responsible for the handling of a claim.

A critical analysis of the regulation is conducted with regard to claims relating to vehicles not bearing a registration plate or bearing a registration plate that does not or no longer correspond to the vehicle. I argue that the Bureau, rather than the guarantee fund, should be responsible for claim settlement if the vehicle appears to be insured, despite the defective registration plate. My argument is that the Directive provides that the vehicle with a missing or defective registration plate is deemed normally based in the Member State of the accident. Under the system of the Directive and the green card system, the Bureau bears no liability for motor vehicles normally based in its territory.

Member States can stipulate that damages caused by stolen vehicles or vehicles obtained through an act of violence do not or need not be covered on the insurance policy of the vehicle. In that case, the injured party must have the possibility to apply to the guarantee fund, with the exception of passengers of the stolen vehicle who entered the vehicle entirely voluntarily, provided that the insurer can prove that they were aware of the theft or the violence.

The Directive does not provide that an injured party can apply to the guarantee fund if the MTPL insurer proves insolvent. I argue that the European legislature should provide a regulation for this situation, as it is difficult to defend that there is an insurance obligation, but that this insurance obligation and the related safety net of the guarantee fund do not provide solace if the insurer is insolvent. It should be borne in mind here that the injured party has no influence on the liable motorist's choice of insurer. A solution for insolvency of motor insurers can in my opinion not wait for a general guarantee scheme for insolvency of non-life insurers.

I discuss extensively the question of subsidiarity of the guarantee fund. The Directive allows the Member States to restrict access to the guarantee fund significantly - probably to restrict the financial burden for the direct financiers of the fund, the insurance undertakings. In many countries, parties having a right of recourse appear excluded from claims against the guarantee fund, but there are even more radical variants. For example, France and to a lesser extent Germany under certain circumstances also exclude claims if the injured party, including the directly affected victim, can have his damages compensated from other sources. By comparison, the position of the Dutch Waarborgfonds Motorverkeer (Motor Vehicle Guarantee Fund) can hardly be regarded as subsidiary. Not only can the Dutch injured party choose between applying to his own resources (such as a comprehensive insurance policy), parties having recourse can also apply to the Waarborgfonds Motorverkeer and the Wam does not allow for the possibility to exclude occupants of a stolen vehicle or a vehicle obtained through an act of violence from compensation by the guarantee fund.

The claim against the Waarborgfonds Motorverkeer is not subject to the rules of the Hague Convention, pursuant to Article 2, letter 6 of the Convention. The Rome II Regulation may apply, because this Regulation does not stipulate an exception for claims against public guarantee funds for automobiles. Under the Rome II Regulation, Dutch law normally applies, as the main rule of the Regulation is the lex loci delicti. In certain situations, however, the Dutch Waarborgfonds could be held liable on the basis of the law of another Member State. For example, in case of an accident provoked by an uninsured vehicle which is normally based in the Netherlands and in which a resident of a third Member State suffers damages. But if a Dutch 'elobike' (a bicycle with an auxiliary electric engine, which is exempt from compulsory insurance) causes an accident in another Member State, the guarantee fund of the Member State of the accident will exercise a right of recourse on the Waarborgfonds Motorverkeer, on the basis of the law of that Member State.

The next section of Chapter 4 is devoted to the visiting victim within the meaning of the 491 Directive.

In this context, I first discuss the claims representative: the representative that each insurance undertaking with an establishment in a Member State must appoint in the other Member States, to whom the victim of an accident in a Member State other than the State of his residence can present his claim after he has returned to his own country.

The conditions that must be met before an injured party can apply to the claims representative are examined: who qualifies as an injured party, what is the relevance of the residence of the injured party, of the country where the accident takes place, of the Member State where the liable vehicle is normally based and of the Member State in which it is insured and how are all these aspects related? Attention is also paid to accidents in non Member State countries that participate in the green card system.

I have reached the conclusion that the position of the visiting injured party, who suffers damages caused by a vehicle exempted from compulsory insurance pursuant to Article 5, first or second paragraph of the Directive, should be improved. The injured party of a vehicle exempted under the first paragraph of Article 5 would have to apply to the person who is responsible for settling claims in the Member State where the vehicle is normally based. The visiting injured party of a vehicle exempted pursuant to Article 5, second paragraph, does not have a claims representative in his own country either and would have to apply to the guarantee fund of the Member State of the accident. In both situations I argue for the application of Article 25 of the Directive. Article 25 pertains to the situation in which the insurer of the liability cannot be identified and gives the injured party a right to the compensation body of the State of residence. As the article does not distinguish between reasons why an insurance undertaking cannot be found, it may be possible to apply to the compensation body of the Member State of the residence of the injured party. It is recommended that the European legislature clarifies this situation.

The legai status of the claims representative is that of an agent of the insurer. I conclude in this respect that the Directive suggests that this agency should be very broad, but that there are still many uncertainties with regard to the possibilities for the insurer to interfere in the claim settlement. I argue that the influence of the insurer on how the claims representative settles the claim is less problematic here than it is in case of claim settlement by the nominated correspondent under the green card system. The claims representative will usually have to settle the claim according to the law of the country of the accident, which is in most cases the law of the country of the insurer. As the claims representative will be less familiar with that law than the insurer and will also need factual information from the country of the accident to be able to settle the claim, contact with the insurer is inevitable.

I note in this context that the Directive entails that the claims representative must also be authorised to proceed to pay the injured party, but such an obligation of the claims representative to make payments to the injured party is difficult to enforce in practice. The position of the claims representative under Dutch law is discussed, including the question of the applicable law to the agency contract of a claims representative in the Netherlands, appointed by a foreign insurer, and a claims representative abroad, appointed by a Dutch insurer. It is concluded that this relationship must be governed by the law of the country of establishment of the claims representative.

An important role in the framework of the protestion of the visiting injured party is reserved for the compensation body. This body acts in two situation.

The first is the situation referred to in Article 24 of the Directive: the liable vehicle is insured, but the insurer has either failed to appoint a claims representative or this representative (or the insurer itself) fails to make a reasoned offer within three months or - if liability or the amount of the Toss have not yet been (sufficiently) established - fails to give a reasoned reply to all points of the request for compensation within that period. This 'reasoned reply' is discussed extensively in chapter 5.

The second situation in which victim can present a claim to the compensation body relates to the liable vehicle being uninsured or not identified; this situation is regulated in Article 25 of the Directive.

In the context of the compensation body, the question which parties qualify as injured parties and the question of subsidiarity of the compensation body are discussed in detail. The authors of the Directive appear to have intended that subrogated parties having a right of recourse cannot present a claim to the compensation body, but the text of the Directive is ambiguous. As a result, it appears that Member States have regulated the position of these parties having recourse vis-à-vis the compensation bodies in different ways: in some Member States, these parties have no claim against the compensation body, while in other states, their claims will be accepted.

It is explained that the role of the compensation bodies in the framework of Article 24 of the Directive is different from that in the framework of Article 25. Pursuant to Article 24, the body mainly acts as a catalyst that must get the claim settlement going. Only if it fails to achieve this - within two months -, will the compensation body handle the claim itself. I criticise the Jack of clarity with regard to the responsibility of the compensation body in the event that the insurer does not give a reasoned response until after expiry of the two-month period. While the Directive seems to suggest that the compensation body must transfer the file to the insurer, I support the clause in the agreement between the compensation bodies that they shall not transfer the file and that they shall continue to handle the claim.

Another unsatisfactory aspect of the regulation is the impossibility for the compensation body to intervene in the event that an insurer or claims representative does provide a reasoned response at first, but settlement of the claim is subsequently seriously delayed. Within the framework of Article 25, the compensation body will start to handle the claim immediately since there is no insurer who can be urged to give a reasoned reply.

The compensation body in the Member State of domicile of the victim is classified as a statutory guarantor of the compensation body of the Member State where the insurer company of the liable vehicle is established, or of the guarantee fund of the Member State of the accident or where the uninsured liable vehicle is normally based.

The arrangement of the Schadevergoedingsorgaan in the Wam is largely in accordance with the Directive, but adjustment is needed in two respects. First, the Wam fails to make clear that the obligation of the claims representative also to settle claims in respect of accidents in non-Member States (to the extent that they participate in the green card system), does not require the Dutch insurer to extend its cover under the policy to these countries. Second, a literal reading of the Wam suggests that the Dutch injured party can also apply to the Dutch Compensation Body if the accident occurs in another non-Member State, and is caused by an uninsured motor vehicle normally based in another Member State. That would be an incorrect transposition of the Directive, which should be corrected in the next amendment of the Wam.

As opposed to the guarantee fund, the Dutch legislature has made the Compensadon Body subsidiary: parties having recourse cannot present their claim to the Dutch Compensation Body.

The Wam wrongly misses a mutatis mutandis clause as the one of Article 26 Wam in which Article 7 of the Wam providing for a number of competent courts for the victim's claim is declared to apply to the Guarantee Fund as well - with regard to the Compensation Body. The consequence is that the Compensation Body can only be summoned before the court of the place of its establishment.

As to the law applicable to the claim of the injured party who has returned to the Netherlands after an accident in another Member State, it is argued that, in principle, this is the law of the Member State of the accident. This law governs not only the liability issue and the question of the amount of compensation, but also the scope of his claim on the compensation body.

The guarantee fund may play a role if a resident of a Member State becomes the victim of an accident abroad. In the analysis of the claims of the injured party against the guarantee fund, the focus is on the Dutch injured party. He will only need to approach the guarantee fund of the country of the accident, in the event that the accident was caused by an unknown or uninsured vehicle and took place in a nonMember State. In case of an accident in a Member State, he can - pursuant to Article 25 of the Directive - usually appeal to the compensation body of the Member State of his residence.

The question of the courts, competent for hearing the claim of the Dutch injured party, must be answered on the basis of the law of the country of the accident, which also governs the scope of his claims against the guarantee fund.

With regard to visitors of the Netherlands who become the victim of an accident in the Netherlands, the Dutch Waarborgfonds Motorverkeer will only receive claims from residents of non-Member States in cases of unknown or uninsured liable vehicles. Residents of Member States can, after all, apply to the compensation body of the Member State of their residence. The jurisdiction rules of the Wam apply and the claim is governed by Dutch law.