High Court allows joinder of insurer as third party under O.16 to determine contribution and liability issues.

[2018] IEHC 532

THE HIGH COURT

2017 No. 7450 P

Between:

John Haughton

Plaintiff

– and –

Quinns of Baltinglass Ltd

Defendant

JUDGMENT of Mr Justice Max Barrett delivered on 1st October, 2018.

1. Mr Haughton is seeking damages for personal injuries arising from an accident that is said to have occurred at the defendant’s

premises on 21st July, 2015. The defendant is a limited liability company incorporated in Ireland and engaged in an agri-store business

at its premises in Athy, Co Kildare. Mr Haughton is a farmer and, on 21st July, 2015, was lawfully on the defendant’s premises for the

purposes of purchasing cattle feed. He alleges that his arm was crushed by a machine used by the defendant for the purposes of

dispensing cattle feed. His proceedings were commenced by way of personal injuries summons which issued on 14th August, 2017,

and was served under cover of letter dated 6th September, 2017. Particulars have been raised and replies to same furnished (both in

September 2017); a full defence was delivered on 23rd November, 2017.

2. It is pleaded, inter alia, in the personal injuries summons that a hydraulically controlled bucket of a loading shovel, being “part of a

machine” used to dispense cattle meal was – “due to the negligence, breach of duty, including breach of statutory duty and/or

nuisance of the Defendant, its servants or agents” – caused to close, crushing Mr Haughton’s left arm. The machine is said to be a

vehicle known as a ‘Manitou Maniscopic Loader’. That vehicle is claimed to have been at all times insured under a Commercial Motor

Fleet Insurance Policy that the defendant has in place with Zurich Insurance plc. Strictly without prejudice to the defendant’s denial

of liability, in the event that the defendant is found liable in the within proceedings, the defendant wishes to contend that any liability

arising falls to Zurich to meet. The defendant will seek to advance this contention, having regard to the insurance policy aforesaid

and on the basis, inter alia, of the decision of the Court of Justice in Damijan Vnuk v. Zavarovalnica Triglav [2014] CJEU C-162/13.

3. In its judgment in Vnuk, the CJEU (i) pointed to linguistic divergences between the different language versions of Council Directive

72/166/EEC of 24 April 1972 on the approximation of the laws of Member States relating to insurance against civil liability in respect of

the use of motor vehicles, and to the enforcement of the obligation to insure against such liability (OJ L103, 02.05.1972, 1), (ii)

referred, at para.46 of its judgment, to settled case-law whereby a provision that is the subject of such divergence “must be

interpreted by reference to the general scheme and purpose of the rules of which it forms part”, (iii) held in effect that the concept

of ‘use of vehicles’ in the European Union’s Motor Insurance Directives as an autonomous concept of European Union law must be

given a uniform interpretation in all European Union member states, (iv) observing as follows, at para.60 of its judgment:

“Article 3(1) of Council Directive 72/166/EEC of 24 April 1972 on the approximation of the laws of Member States relating

to insurance against civil liability in respect of the use of motor vehicles, and to the enforcement of the obligation to

insure against such liability must be interpreted as meaning that the concept of ‘use of vehicles’ in that article covers

any use of a vehicle that is consistent with the normal function of that vehicle. That concept may therefore cover the

manoeuvre of a tractor in the courtyard of a farm in order to bring the trailer attached to that tractor into a barn, as in

the case in the main proceedings, which is a matter for the referring court to determine.”

4. Critically, the concept of the “use of vehicles” falls to be interpreted as extending to “any use” of a vehicle that is “consistent with

the normal function of that vehicle” and is not limited e.g., in geographic scope to use on public/private land. (So in Vnuk, as is clear

from the just-quoted text, what was in issue was “the manoeuvre of a tractor in the courtyard of a farm in order to bring the trailer

attached to that tractor into a barn”, more particularly, an accident that occurred when bales of hay were being stored in the loft of

a barn, with a tractor to which a trailer was attached striking a ladder on which Mr Vnuk had climbed, causing him to fall).

5. By letters of 5th and 22nd February, 2018, the defendant wrote to Zurich calling upon it to provide an indemnity within 14 days of

the date of the said letter. As of 5th April, 2018, the date upon which the affidavit grounding the within application was sworn, no

reply had been received to the said correspondence. The defendant has therefore issued a notice of motion seeking the following

reliefs:

“1. An order pursuant to Order 16, Rule 1(1) of the Rules of the Superior Courts 1986 (as amended) [RSC] joining Zurich

Insurance plc…as a Third Party to the within Proceedings;

2. An Order granting the Defendant liberty to issue, and to serve upon Zurich Insurance plc, a Third Party Notice [in the

form exhibited before the court]….

3. Such further and other Order or reliefs and/or directions as the Court may deem appropriate, including directions

pursuant to Order 16 Rule 1(1)…”,

and certain ancillary relief.

6. Order 16, RSC is headed “THIRD PARTY PROCEDURE”. Order 16, rule 1(1), RSC provides as follows:

“Where in any action a defendant claims as against any person not already a party to the action (in this Order called

‘the third party’) –

(a) that he is entitled to contribution or indemnity, or

(b) that he is entitled to any relief or remedy relating to or connected with the original subject matter of the

action and substantially the same as some relief or remedy claimed by the plaintiff, or

(c) that any question or issue relating to or connected with the said subject matter is substantially the same as

some question or issue arising between the plaintiff and the defendant and should properly be determined not only

as between the plaintiff and the defendant but as between the plaintiff and the defendant and the third party or

between any or either of them,

the court may give leave to the defendant to issue and serve a third party notice and may, at the same time, if it shall

appear desirable to do so, give the third party liberty to appear at the trial and take such part therein as may be just,

and generally give such directions as to the court shall appear proper for having any question or the rights or liabilities of

the parties most conveniently determined and enforced and as to the mode and extent in or to which the third party

shall be bound or made liable by the decision or judgment and in the action.”

7. The obvious motivation for O.16 is, as was classically stated by Lavery J. in Gilmore v. Windle [1967] IR 323, 329, “to avoid

multiplicity of actions and to enable, so far as can be done with just regard to the interests of the several parties involved, all issues

arising out of the particular incident or transaction to be determined by the one court at one time; thus avoiding repetition of

evidence and argument before different tribunals” (see also Dillon v. MacGabhann (Unreported, High Court, Morris J., High Court, 24th

July, 1995)). Where one commonly sees O.16 invoked is in the context of a claimed right of indemnity or contribution (the latter in

effect being a claim to partial indemnity), with such a right existing where the relation between the parties is such that in law or in

equity there is an obligation on the one party to indemnify the other (see Eastern Shipping Co v. Quah Beng Kee [1924] AC 177, 182).

8. In the within case, it seems to the court that there is a sufficient basis for the joinder of Zurich as a third party, pursuant to O.16,

r.1, RSC, on the basis that the defendant wishes claim (i) contribution or indemnity from Zurich (thus bringing itself within sub-

category (a) of O.16, r.1(1), RSC) and/or (ii) any relief or remedy relating to or connected with the original subject matter of the

action and substantially the same as some relief or remedy claimed by the plaintiff (thus bringing itself within sub-category (b) of

O.16, r.1(1), RSC)). Additionally, and bringing the defendant within category (c) of O.16, r.1(1), RSC, the court considers that (a)

any issue between the defendant and Zurich, pertaining to the applicability and operability of Vnuk is an important issue relating to or

connected with Mr Haughton’s claim against the defendant and (b) such issue ought properly and can conveniently be determined in

the within proceedings.

9. The court will make the orders sought at items 1 and 2 of the notice of motion.