UKSC Case Cox v Ergo Versicherung AG

Cox v Ergo Versicherung AG

• Case Background: Major Christopher Cox, a British officer, died in a car accident in Germany in 2004. His widow, Katerina, sued the German insurer Ergo Versicherung AG in England for bereavement and loss of dependency.

German Law

• Section 844 of the BGB (Bürgerliches Gesetzbuch): governs the extent of recoverable loss for a fatal accident
• Section 844(2) BGB: provides that the person liable for damages must pay an annuity to the third party (e.g. widow) to the extent that the person killed would have been obliged to provide maintenance
• Duty to mitigate: a substantive requirement of German law, which means that the claimant must take reasonable steps to minimize their loss

English Law

• Fatal Accidents Act 1976: the statutory basis for a claim for bereavement or loss of dependency in English law
• Section 1(1) and (2) of the Fatal Accidents Act 1976: provides that the person who would have been liable if death had not ensued shall be liable to an action for damages
• Section 3 of the Fatal Accidents Act 1976: provides for the assessment of damages, including pecuniary loss
• Section 4 of the Fatal Accidents Act 1976: provides that benefits which have accrued or will accrue to any person from the estate or otherwise as a result of the death shall be disregarded
• Section 1A of the Fatal Accidents Act 1976: provides for damages for bereavement, which is a lump sum award

Choice of Law

• English rules of private international law: distinguish between questions of procedure and questions of substance
• Part III of the Private International Law (Miscellaneous Provisions) Act 1995: applies to determine the law applicable to causes of action in tort
• Section 14(3)(b) of the Act of 1995: preserves the distinction between substance and procedure, excluding questions of procedure from the rules of the lex causae

Harding v Wealands Case

• Leading case on the distinction between substance and procedure: The House of Lords held that the rules of the lex causae (German law) governing the assessment of damages were procedural and therefore inapplicable to litigation in England
• Lord Hoffmann's test: identifies actionable damage as an integral part of the rules which determine liability, and the assessment of compensation as a question of remedy### German Law and Damages
• German law allows for damages for psychological distress under certain circumstances, but not for bereavement as such.
• The rules governing the recoverability of particular heads of loss fall within the scope of the defendant's duty.

Fatal Accidents Act Provisions

• The Court of Appeal considered the Fatal Accidents Act provisions to be procedural.
• The Act's provisions only apply to actions brought under the Act itself, not to actions under foreign law.
• Sections 1A, 3, and 4 of the Act do not lay down general rules of English law for assessing damages.

English Law and Damages

• English law provides a remedy that harmonizes with the German law right, namely damages.
• The principal head of loss for which the defendant is liable to compensate is the deprivation of the net financial benefit to the widow of her legal right to maintenance.
• English law principle of assessment is to put the claimant in the same financial position as they would have been in if the husband had not been fatally injured.

Credit for Receipts

• Credit must be given for receipts referable to the original loss, with very limited exceptions.
• In this case, credit must be given for maintenance from the widow's subsequent partner during the period since the birth of their child.

Applicable Law and Public Policy

• Section 14(3)(a)(i) of the Private International Law (Miscellaneous Provisions) Act 1995 states that the application of a foreign law may conflict with principles of public policy.
• Section 14(4) states that the Act has effect without prejudice to the operation of any rule of law that either has effect notwithstanding the rules of private international law or modifies the rules of private international law.

Extra-Territorial Application

• The Fatal Accidents Act 1976 does not have extraterritorial effect.
• The presumption against extraterritorial application is strong, and the Act's provisions must be implied to have extraterritorial effect.
• The Act's purpose is not to create new rules of conduct, but to regulate the consequences of existing rules of conduct.

Choice of Law

• The lex causae arrived at on ordinary principles of private international law is German law.
• The choice of law depends on the connection between the facts and the various alternative systems of law.
• The Fatal Accidents Act 1976 does not have implied extraterritorial effect, and its provisions do not apply to accidents outside England.### Double-Actionability Rule
• The double-actionability rule was a procedural rule that required conduct to be actionable under English law as well as by its proper law.
• The rule was not meant to displace the law governing the tort, but rather to make it pointless to rely on that law.
• The rule originated from Philips v Eyre (1870) LR 6 QB 1.

Fatal Accidents Act

• The Fatal Accidents Act 1976 was enacted to correct an anomaly in the English law of tort.
• There is no reason to apply the Act to foreign fatal accidents that are governed by foreign laws.
• The Act's purpose is to correct an anomaly in the English law of tort, and its application is not intended to be extraterritorial.

Mandatory Rules

• Mandatory rules are rules of domestic law that are regarded as so important that they must apply in any action before a court of the forum, even where the issues are in principle governed by a foreign law.
• The Private International Law (Miscellaneous Provisions) Act 1995 saves such rules.
• The German rules on damages for fatal accidents are based on a perfectly orthodox principle and are not unjust.

Substantive and Procedural Law

• The distinction between substantive and procedural law originated in the common law and was preserved by the Private International Law (Miscellaneous Provisions) Act 1995.
• The distinction applies in the present case when examining both the nature of the German rules under article 844 BGB and the nature of sections 3 and 4 of the FAA.
• Substance includes the identification of heads of recoverable loss, such as pain and suffering, and loss of consortium (solatium).

Damages and Causation

• The rules governing damages and causation are rules that determine the scope of a defendant's liability.
• The value judgment concerning the extent of the loss for which the defendant ought fairly or reasonably or justly to be held liable involves the law setting a limit to the causally connected losses for which a defendant is to be held responsible.

Relevant Substantive Law

• The relevant substantive law governing the tort is German law.
• Article 844 BGB requires credit to be given only for maintenance received as a matter of legal right from a subsequent partner.
• The German rule is a rule of substantive law, not procedural law.