Antonio Pimentel Da Costa v (1) Christopher Carter
| Jurisdiction | Bermuda |
| Judgment Date | 08 November 2017 |
| Neutral Citation | [2017] SC Bda 96 Civ |
| Date | 08 November 2017 |
| Docket Number | CIVIL JURISDICTION 2017 No: 92 |
| Court | Supreme Court (Bermuda) |
[2017] SC (Bda) 96 Civ
In The Supreme Court of Bermuda
CIVIL JURISDICTION 2017 No: 92
Ms Sara Tucker, Trott & Duncan Limited, for the Plaintiff
Ms Victoria Greening, Wakefield Quin Ltd, for the First Defendant
Mr Jeffrey Elkinson, Conyers Dill & Pearman, for the Second Defendant
Whether insurance policy covered driver of motor car involved in collision — whether ownership of motor car transferred to driver, in which case the policy was cancelled — whether coverage excluded because driver was convicted of driving while impaired
(In Court)
On 1 st January 2016 the Plaintiff (“Mr Da Costa”) suffered extensive injuries in a collision between the motor car that he was driving and the motor car driven by the First Defendant (“Mr Carter”). Mr Da Costa issued proceedings against the Mr Carter for negligence and the Second Defendant (“BF&M”) as Mr Carter's insurer. Mr Carter has admitted liability but reserved his position as to the quantum of damages pending discovery. BF&M denies that at the time of the accident there was an insurance policy in force covering either Mr Carter or the motor car that he was driving.
On 13 th July 2017 I ordered the trial as a preliminary issue of whether, for the purposes of Mr Da Costa's claim, Mr Carter was covered by an insurance policy issued by BF&M. This is my judgment on that issue.
BF&M denies that it has ever insured Mr Carter and avers that, whereas it had previously insured the motor car that he was driving at the time of the accident, this was when it was owned by a third party, a man named Ian Mummery. BF&M avers that Mr Mummery transferred legal title to the motor car to Mr Carter, whereupon the policy was automatically cancelled. To succeed, Mr Da Costa must prove that at the time of the accident the third party and not Mr Carter was still the legal owner of the motor car and hence that the insurance policy was still in force. (“The Ownership Issue”.)
As a result of the collision, Mr Carter was charged with driving when under the influence of alcohol, contrary to section 35AA of the Road Traffic Act 1947 (“the 1947 Act”), to which he pleaded guilty. BF&M alleges that if the insurance policy which had previously covered the motor car was still in force, then by reason of an exclusion clause (“the Exclusion Clause”) in the policy, read in conjunction with a statutory provision limiting the effect of the clause, any liability under the policy would be capped at $125,000.00. To defeat this allegation, Mr Da Costa must satisfy me that the facts of the present case do not fall within the Exclusion Clause. (“The Exclusion Clause Issue”).
The trial of the preliminary issue was a dispute between Mr Da Costa and BF&M. Although his interests were aligned with Mr Da Costa's interests on this issue, Mr Carter took a neutral position at the hearing. Consequently, whatever the outcome of the hearing, he is not at risk as to costs.
The motor car in question was a Nissan motor car, registration number 29030. It was covered by an insurance policy which provided in material part: (i) the driver, who must hold a valid and current license, must have the policy holder's permission to use the vehicle; (ii) no assignment of the policy or any interest in it is binding upon the insurer without the insurer's written consent; and (iii) if the vehicle is transferred to new ownership, then, unless the insurer agreed in writing to continue the insurance, the policy is cancelled from the time of transfer. The policy holder would be entitled to a return of premium less the premium for the period the policy had been in force. It was common ground that there had been no assignment of the policy to Mr Carter and that BF&M had not been asked, let alone agreed, to transfer the policy to him.
I had the benefit of evidence from Mr Carter. As his witness statement, which contained his evidence in chief, is short, I shall set it out in full.
“ 1. My good friend Ian Mummery was leaving the island and he said to me that I could have his car. He told me that it was till insured and TCD was still valid, and that the documents for both were in the glovebox.
2. I drove him to the airport in the car and dropped him off and then he left and I drove it home. I already had a car of my own, and I used mine the majority of the time, and was going to give Ian's car to another friend. He did not have a driver's license but he was going to get it and then the car would be transferred into his name.
3. I usually drove my car but the night of the accident my car had a broken water pump and I did not want to spend the money to fix it over Christmas and New Year so I drove Ian's car. I either kept it at my house or at work, because I could park it there.
I would never have driven it if I did not think I was insured to drive. I am a car mechanic and I would lose my job doing that.
My own car had insurance with Colonial. It did cross my mind to put Ian's car on my insurance but I thought I was covered under his.”
Mr Carter was cross-examined by Jeffrey Elkinson, counsel for BF&M, who asked him whether he regarded the car as his own in the time that he had it after Mr Mummery left. Mr Carter replied that he had his own car, so he wouldn't necessarily say it was his own. Mr Elkinson then asked whether it would be fair to say that Mr Mummery gave him the car as a gift. Mr Carter said that it would.
Mr Carter was then cross-examined by Sara Tucker, counsel for BF&M. He explained that Mr Mummery had given him the car to hold for a mutual friend until the friend got his driver's licence. He was to look after it in the interim. He didn't use it as he had his own vehicle. He knew that this was Mr Mummery's desire for the car from conversing with him. Ownership was never transferred to him, but Mr Mummery did give him permission to drive the vehicle.
I also had the benefit of evidence from Larenzo Ratteray, who is Vice-President of Claims at BF&M. He exhibited an exchange of emails with Mr Mummery which took place in February 2016.
On 4 th February 2016, Mr Mummery emailed an employee at BF&M as follows:
“ I am contacting yourself regarding the policy no: P229055.
Myself and Emma Law owners of the vehicle left the island end of July 2015, leaving the vehicle Reg no: 29030, giving Chris Carter permission to drive the vehicle.
We are aware of the situation with Chris, I hope this can help with the process. Any issues please don't hesitate getting in touch.”
On 9 th February 2016 Mr Ratteray sent an email in reply:
“ Thank you for your email confirming that your vehicle was being used by Mr. Carter at the time of the collision and that he was left with access to and granted permissive use vehicle free of charge.
We ask that you confirm if the vehicle was left with the intention of ownership passing on to Mr. Carter via sale of [sic] gift? If so please confirm the details of that arrangement.”
Mr Mummery replied:
“ I can confirm that the vehicle, registration P29030 was given to Chris Carter as a gift with no cost.”
On 11 th February 2016 Mr Ratteray emailed Mr Mummery to advise him of the legal consequences of this information:
“ When a vehicle is given or sold, although interest (ownership) in the vehicle is transferred, the insurance policy associated with the vehicle is non-transferable. The result is Mr. Carter while driving a vehicle registered and insured in your name, as the new owner, was in effect driving an uninsured vehicle. I put this to you at this early stage prior to BF&M following up with Chris.”
Mr Mummery did not reply. Some months later, on 15 th December 2016, Mr Ratteray emailed Mr Mummery again to inform him that BF&M had denied liability on the basis of Mr Mummery's previous reply that the vehicle was given to Mr Carter. Mr Ratteray asked:
“ If there are further details regarding the transfer of ownership we must be made aware of please do so urgently so we are adequately prepared to defend this matter.”
Once again, Mr Mummery did not reply.
The Ownership Issue boils down to whether Mr Mummery gave his car to Mr Carter, either for Mr Carter to keep for himself or to hold on trust for their friend once he got his driving licence. A car is a chattel, and the test for determining whether there has been a gift of a chattel was considered by Lloyd LJ in Day v Harris and others [2014] Ch 211 EWCA. The relevant facts appear from the headnote. In 1976 Sir Malcolm Arnold, a distinguished composer, sent two tea chests containing the majority of the manuscripts of his compositions together with other items to his daughter's house, and sent a postcard to his son reading: “ All the books, pictures, sculptures etc are for you and Katherine to share and keep, or sell if you like!” One of the questions on appeal was whether this action by Sir Malcolm, who was by now deceased, was sufficient to gift the manuscripts in the tea chests to the two children. The Court held that it was. Lloyd LJ, with whom the other members of the Court agreed on this issue, reviewed the applicable principles at paras 67 – 71 of his judgment:
“ 67 A chattel may be given by one of three methods: a deed of gift, a declaration of trust or delivery. If there is a deed or a declaration of trust, whatever issues of interpretation may arise, there will be some words, probably relatively formal, from which the intention of the party or parties can be found. With delivery, something is needed to show the basis of the delivery to be a gift, but this may be relatively informal, as inIn re Cole, A Bankrupt [1964] Ch 175(though in that case the Court of Appeal disagreed with...
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