Brexit has an undeniably huge role in shaping our legal system for the future. On 9 December 2021, the Court of Justice of the European Union (CJEU) handed down judgment in Tattersall v Seguros Catalana Occidente S.A and Basquille on the long debated ‘Keefe question’. It is important to consider the significance of this judgment and the effect that Brexit will have on such issues moving forward.
The claimant, Ms Tattersall, was staying with family in a rental villa in Spain when she tripped and fell down an unmarked step, suffering injuries that required surgery in Spain. The claimant brought a claim for compensation against the public liability insurer of the villa and, due to concerns over the policy, the owner of the villa, Ms Basquille, was also named as a defendant.
It was agreed between the claimant and the public liability insurer that the courts of England and Wales had jurisdiction pursuant to Article 13(2) of the Recast Brussels Regulation. However, Ms Basquille’s insurer disagreed that the English courts had jurisdiction over any claim against her.
The matter was referred to the CJEU.
The Keefe question
The Keefe question originates from Hoteles Pinero Canarias SL v Keefe. The claimant was domiciled in England and suffered injury whilst staying in a hotel in Spain, when an unsecured parasol hit them in the head. This led to serious facial and brain injuries and the value of the claim was estimated at £5 million. In the courts of England and Wales, the claimant brought a direct action against the hotel’s liability insurer as the 2001 Brussels Regulation special rules relating to insurance meant that jurisdiction was established.
The insurance policy was limited to €600,000, leaving over £4 million of uninsured damages. The claimant therefore joined the hotel as a second defendant, citing Article 13(3) in doing so. The issue was therefore whether Article 13(3) allowed for an insured to be joined to an action against an insurer where jurisdiction had been established.
The insured argued that Article 13(3) had limited scope, only applying where there is an insurance dispute involving the insured. The hotel therefore contended that this was a claim resulting from negligence and as such, should not be thought of as an insurance claim. In turn, this would mean the special rules relating to insurance do not apply, excluding jurisdiction over the hotel.
The Court of Appeal in Keefe held that English court jurisdiction was established over the claim against the insured. Article 13(3) was therefore interpreted as meaning the insured could be joined to an action where jurisdiction had been established over the insurer.
In contrast to the approach in Keefe, the recent CJEU decision in Tattersall considered the position of Article 13(3) and provided much needed clarity whilst coming to the opposite conclusion to the Court of Appeal. In the CJEU’s reasoning, the court stated that the special rules on insurance are to address an imbalance between the parties as an insurer is considered a stronger party. The claimant and the insured are seen as weaker parties, so there is no reason to allow a claimant to sue a defendant in their member state of domicile under the special rules.
Despite the Brexit transition period having passed, we cannot be certain this is the last on the matter, given the CJEU’s continued jurisdiction in respect of requests for preliminary rulings referred before the end of the transition period. Either way, the significance of this should not be understated, as such issues will not benefit from resolution by the CJEU in the future and the final decision will come from our home courts.
The Keefe question is a perfect example of the relevancy of this development. Had this case not been referred to the CJEU, the current outcome may not have been reached. Hotly debated topics such as this may never reach the CJEU in the future, demonstrating the potential for divergence between a post-Brexit legal system and the alternative CJEU rulings.
With thanks to David Armstrong, trainee solicitor at Kennedys, for his contributions to this post.