Limits to Ex Turpi Defence in Motor Claims

In a decision no doubt disappointing to any motor insurance companies, the Court of Appeal have recently refused to allow an ex turpi defence to defeat a credit hire claim.

In the recently published decision of Ali v HSF Logistics Polska Sp zoo [2024] EWCA Civ 1479 a claim for hire charges was allegedly incurred after the claimant's car was damaged in a road traffic accident. The defendant’s lorry had driven into the claimant’s parked car, causing damage which rendered the car undrivable. The claimant hired a replacement vehicle on credit hire terms while his car was being repaired. Incurred over 36 days the total hire charges were £21,588.72. The defendant admitted negligence but established that, at the time of the accident, the claimant did not have a valid MOT certificate for his vehicle, the certificate having lapsed four-and-a-half months before the accident. The defendant therefore argued that because the claimant's pre-accident use of his car was illegal, the accident could not be said to have caused the loss of use which the claimant claimed to have mitigated by incurring hire charges.

At first instance this argument had been successful and the claim dismissed. The driver however appealed against the dismissal of his claim for credit hire charges.

The defendant argued that: (i) the absence of a valid MOT certificate meant that the claim for hire charges was ex turpi causa; and (ii) because there was no valid MOT certificate, the claimant had suffered no compensable loss when his car was rendered unroadworthy by the respondent's tort (causation defence).

On appeal the court was unable to accept that the causation defence was a proportionate response to the problem of claimants who had claims based on inconvenience and the need for suitable transport but who had, in one way or another, committed minor offences in relation to their damaged vehicle. The court concluded that there was a flaw at the heart of the causation defence, which was the assertion that the claimant had suffered no loss as a result of the tort. The loss which fell to be compensated in such cases was inconvenience. The fact that a claimant did not have a valid MOT certificate for the car did not alter the fact that they had been deprived of its use or the fact that that deprivation would have caused inconvenience but for the hiring of a replacement vehicle. As a matter of loss, that was not affected by the absence of a valid MOT.  The absence of the valid MOT merely meant was that, when satisfying his need for convenient transport, the claimant had been committing an offence and exposing himself to the risk of prosecution.

The  court considered that the criminal offence of failing to obtain an MOT certificate was regarded and established by Parliament to be a relatively minor offence which did not carry very great weight when considering proportionality. Thus, although allowing the claim for hire charges in the instant case might "just about" be said to tend towards being harmful to the integrity of the legal system, any harm was strictly limited, and it would be disproportionate to have refused the claimant’s claim on the grounds of ex turpi causa.

The court applied Hewison v Meridian Shipping Services PTE Ltd [2002] EWCA Civ 1821 in that “… An English court should not deprive a claimant of part of the damages to which he would otherwise be entitled because of the defendant’s negligence or breach of duty by reason only of some collateral [insignificant] illegality or unlawful act”.

References were made to similar level offences existing for using a vehicle on the road with a defective lamp, or having a defective windscreen wiper, or non-conforming number plate. The Court therefore appeared to be troubled by how far the doctrine could extend if this first instance was allowed, and this may have played a part in the decision made. The judgment did not rule out a different approach for a more significant criminal offence and so any future matter would need to be assessed on the facts. If you require assistance with such issues please do not hesitate to contact us here at Forbes.