Winrow v Hemphill: The High Court emphasises exceptional nature of ‘manifestly closer connected’ in Rome II. Clarifies ‘habitual residence’.

Winrow v Hemphill ([2014] EWHC 3164), involved a road traffic accident that occurred in Germany on 16 November 2009. The claimant was a rear seat passenger in a vehicle driven by Mrs Hemphill (‘the first defendant’), which collided head on with a German vehicle. The defendant admitted fault for the collision. As a result of the collision, the claimant sustained personal injury, for which she received some treatment in Germany and further ongoing treatment in England. She and her husband returned to live in England in June 2011, earlier than planned. ‘Second defendant’ was the German insurer of the first defendant.

The following was agreed between the parties:

  • iii) Since the claimant’s husband was due to leave the army in February 2014 after twenty-two years’ service he would have returned to England one and a half to two years before that date to undertake re-settlement training. It was always their intention to return to live in England.
  • ii) At the time of the accident the claimant was living in Germany, having moved there in January 2001 with her husband who was a member of Her Majesty’s Armed Services. Germany was not the preferred posting of the claimant’s husband, it was his second choice. He had four separate three year postings in Germany.
  • i) The claimant was a UK national.
  • iv) Whilst in Germany, the claimant and her family lived on a British Army base where schools provided an English education.
  • v) While in Germany, the claimant was employed on a full-time basis as an Early Years Practitioner by Service Children’s Education, (UK Government Agency).
  • vi) The claimant claimed continuing loss and damage including care and assistance and loss of earnings. She asserted that the majority of her loss has been and will be incurred in England. The claimant alleged continuing pain, suffering and loss of amenity.
  • vii) The first defendant was a UK national and an army wife, with her husband serving with the Army in Germany. She had been in Germany for between eighteen months and two years before the accident. She returned to England soon afterwards.

The High Court was asked (1) what law applies per Article 4 Rome II, and (2) whether under the circumstances, Article 4(3) Rome II might have any relevance.

 

On the habitual residence issue, Rome II corrects the overall lex loci damni rule in cases of joint habitual residence between tortfeasor and victim (which was argued to be the case here). Habitual residence was also argued to play a role in the ‘closer connection’ test (see below).

Rome II, the Regulation of the law applicable to non-contractual obligations, does not define ‘habitual residence’ for individuals acting in their personal capacity. The matter therefore is one of national conflicts law. The habitual residence for a natural person is only defined by ht Regulation when it comes to his acting in the course of his business activity. ‘Habitual residence’ is a concept which is not used in Brussels I, however it is used in the Brussels II bis Regulation on jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matter of parental responsibility, where it is left undefined, and in the Rome III Regulation (an instrument of enhanced co-operation and hence not applicable in all Member States) implementing enhanced cooperation in the area of applicable law to divorce and legal separation, where, too, somewhat oddly given its date of adoption (after Rome I and II) it is left undefined.

The Court of Justice has defined ‘habitual residence’ in Swaddling, Case C-90/97, within the context of social security law (entitlement of benefits subject to a residence requirement) as the place  ‘where the habitual centre of their interests is to be found. In that context, account should be taken in particular of the employed person’s family situation; the reasons which have led him to move; the length and continuity of his residence; the fact (where this is the case) that he is in stable employment; and his intention as it appears from all the circumstances.’

Undoubtedly the context of the adjudication needs to be taken into account, such as in Swaddling, a social security case, in which the seeking of holding of employment is likely to have a much greater relevance for determining habitual residence than in the context of, say, maintenance or parental responsibility (where, for instance, the interest and ‘anchorage’ of the child is likely to be much more relevant). [See also House of Lords M v M, [2007] EWHC 2047 (Fam), a case referred to in Winrow]. Moreover, the Court of Justice itself has warned that its case-law on habitual residence in one area, cannot be directly transposed in the context of any other (Case C-523/07, A).

It is obvious however that the ‘centre of interest’ test which in one way or another finds its way into habitual residence in all relevant EU law, includes a subjective  element: the intention of a person to be anchored in a particular place.  This was argued to be relevant in the case at issue, because both victim and tortfeasor were resident in Germany on account of their husbands’ military posting there.

Slade J in my view justifiably held that having regard to the length of stay in the country, its purpose and the establishing of a life there, habitual residence of the Claimant at the time of her accident was Germany. It is not because she followed her husband who was posted in Germany on Army business, that she was in Germany involuntarily.

 

On the issue of manifestly closer connected per Article 4(3) Rome II, the High Court first of all confirmed the exceptional character of the escape clause, however emphasises, and I have great sympathy for this view, that in reviewing that exceptional possibility, there should be no limitation in principle of factors that can be taken into account: Article 4(3) clearly is an exception to the EU’s mantra of predictability in EU private international law, however one which even the European Commission foresaw and which is inherent to the very nature of the exception. Hence the High Court considered inter alia the joint nationality of the victims (with an interesting discussion on whether United Kingdom nationality may be relevant for the consideration of English law being applicable – there is no such thing as ‘English’ nationality); habitual residence at the time of the accident and subsequently; location of subsequent consequences (the victim now suffering those in England; loss of earning occurring in England), etc.: even what a particular court in a particular Member State may consider to be relevant for the application of 4(3) may be very unpredictable indeed may also be disparate across the EU.

However on balance Slade J held that the balance was in favour of not applying the escape clause, particularly in view of the period of time of habitual residence in Germany, and subsequent continuing residence in that country (ia for follow-up treatment). Final holding therefore was

 

  • Factors weighing against displacement of German law as the applicable law of the tort by reason of Article 4(1) are that the road traffic accident caused by the negligence of the First Defendant took place in Germany. The Claimant sustained her injury in Germany. At the time of the accident both the Claimant and the First Defendant were habitually resident there. The Claimant had lived in Germany for about eight and a half years and remained living there for eighteen months after the accident.
  • Under Article 4(3) the court must be satisfied that the tort is manifestly more closely connected with English law than German law. Article 4(3) places a high hurdle in the path of a party seeking to displace the law indicated by Article 4(1) or 4(2). Taking into account all the circumstances, the relevant factors do not indicate a manifestly closer connection of the tort with England than with Germany. The law indicated by Article 4(1) is not displaced by Article 4(3). The law applicable to the claim in tort is therefore German law.

This judgment to my knowledge is one of few discussing Article 4(3)’s escape clause in such detail. A judgment which does justice to both the exceptional nature of the provision, and the need to consider all relevant factors.

Geert.

 

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