About this case:

• Citation:
  [2024] IECA 33
• Judgment:
  External link
• Court:
  Court of Appeal
• Judge:
  Mr Justice Seamus Noonan

Delivering judgment for the Court of Appeal, Mr Justice Seamus Noonan determined that “this was not simply a case of the plaintiff serving a notice of discontinuance which, as the RSC provide, would have required the plaintiff to discharge all the costs of the party against whom he was discontinuing. On the contrary, MIBI’s solicitors offered a compromise to the plaintiff’s solicitors which they accepted, namely that if the proceedings were discontinued against the MIBI, it would not seek its costs.”

Background

On 24 January 2017, the plaintiff was driving his motorcycle when a car pulled out of a junction in front of him, causing him to be thrown to the ground and to be injured. The car did not remain at the scene. The plaintiff made a statement to gardaí describing the other vehicle as a “bright red car” and “possibly a Volkswagen Passat”. On 20 April 2017, gardaí indicated to the plaintiff’s solicitors that no third party had been identified in connection with the accident.

On 20 July 2017, MIBI informed its loss adjusters that the plaintiff had made his own enquiries, obtaining a possible registration number for the vehicle. The plaintiff signed an amended statement prepared by the loss adjusters describing how he came to know of the registration number and stating that gardaí believed that they did not have enough evidence to bring any charges against the suspected driver.

On 17 August 2017, AXA Insurance emailed MIBI erroneously stating that the car was not on cover with it at the time of the accident. On 15 November 2018, the Personal Injuries Assessment Board (PIAB) issued an authorisation in respect of MIBI and the driver of the car and on 16 January 2019, proceedings issued naming them as co-defendants and pleading that MIBI was responsible for the uninsured driver.

On 28 February 2019, FBD Insurance, MIBI’s nominated claim handler, wrote to the plaintiff’s solicitors stating that AXA would indemnify MIBI in respect of the accident, and that its file would be closed. Nonetheless, the plaintiff’s solicitors later wrote to FBD asking them to nominate a solicitor to accept service of the proceedings.

On 1 April 2019, AXA emailed MIBI stating that whilst its handler had incorrectly advised that the car’s driver was uninsured, it would not indemnify MIBI as the insured denied involvement in the accident.

On 18 June 2019, MIBI wrote to the plaintiff asking it to withdraw the proceedings as against it as the second defendant was insured at the time of the accident. The plaintiff’s solicitors immediately replied stating that the plaintiff would discontinue the proceedings as against MIBI on the basis that no costs would be sought by MIBI, and on 19 June 2019, a notice of discontinuance was served on MIBI’s solicitors.

The High Court

On 21 September 2020, the second defendant delivered a defence denying any involvement in the accident, and on 29 July 2022, the plaintiff successfully applied to Mr Justice Paul Coffey ex parte for an order “reinstating the proceedings as against the MIBI”.

The MIBI complained that the application had been made ex parte where the proceedings had been discontinued by agreement on the basis that no costs would be sought by MIBI, and that the plaintiff was now attempting to claim that the driver was unidentified, despite him being named as a defendant in the proceedings.

MIBI applied to set aside the order pursuant to Order 52, rule 3 of the Rules of the Superior Courts. The motion was heard by Mr Justice Coffey on 29 June 2023, in which he gave an ex tempore judgment setting aside his order and referring to Smyth v Tunney [2009] 3 I.R. 322 as support for the proposition that a plaintiff who serves a notice of discontinuance cannot unilaterally withdraw it unless there is an abuse of process.

The plaintiff appealed, contending that the High Court erred inter alia in accepting that it did not have jurisdiction to set aside the notice of discontinuance.

The Court of Appeal

Mr Justice Noonan noted that in accordance with the ‘Agreement dated 29 January 2009 between the Minister for Transport and the MIBI’, where a claim involves an identified but uninsured vehicle a claimant may sue the MIBI as a co-defendant with the vehicle owner and/or driver, but where the owner and/or driver is unidentified, the MIBI must be named as the sole defendant.

“From a very early juncture, therefore, it was, or ought to have been, clear to the plaintiff’s solicitors that this was likely to be an unidentified/untraced motorist case… The plaintiff himself even signed a statement acknowledging his understanding that the gardaí considered that they did not have enough evidence to bring any charges against Mr. McDonagh”, the judge considered, continuing: “Despite that knowledge… The MIBI was not sued under the separate and distinct basis that it is the body responsible for damage caused by an unidentified or untraced motorist.”

Mr Justice Noonan also considered it of central importance that this was not simply a case of the plaintiff serving a notice of discontinuance, which would have required the plaintiff to discharge MIBI’s costs. Rather, the court found that the parties had reached a “valid and binding compromise”.

The Court of Appeal considered that the application to Mr Justice Coffey should not have been made ex parte where it was highly prejudicial to MIBI’s interests, finding: “Neither the fact that the application was made on the last day of term or the fact — if it was the fact — that the Statute of Limitations for any action against the MIBI would expire in September, 2022 justified the ex parte application.”

The court also opined that it was not clearly explained to the High Court that it was being asked to make a “highly unusual order… Had Coffey J. understood clearly what was being asked of him, it would be surprising if he did not seek some authority to establish that he had jurisdiction to make the order sought.” Mr Justice Noonan suggested that “the judge appears to have thought that it was an application simply to join the MIBI as an additional defendant, an authorisation to do so had been obtained and the plaintiff was in time”.

Finally, the court considered that no satisfactory explanation had been offered by the plaintiff for his “extraordinary delay” in making the application, some 22 months after the defence was delivered.

The court opined that in any event, “it is doubtful that the procedure here adopted of suing the MIBI as a co-defendant in an unidentified and untraced motorist case is correct when the Agreement, subject to what I have said already, clearly provides for the MIBI being sued as sole defendant in such cases… The correct procedure would in such circumstances be to issue separate proceedings against the MIBI as sole defendant but perhaps that presented a limitation problem for the plaintiff.”

Conclusion

Accordingly, the court dismissed the appeal.

Higgins v. Motor Insurers’ Bureau of Ireland & Anor [2024] IECA 33