No Need to Think - Liability Excluded if the Information is There

It is unlawful to drive a car without valid third-party insurance, but convictions for driving without insurance are still common. Provisions therefore exist to allow persons injured by uninsured drivers to make claims against insurers for compensation in appropriate circumstances. In general, therefore, the fact that the driver who is responsible for the accident leading to the injury is uninsured does not mean that there is no right to recompense.

However, this is not always the case. There will be no right to compensation by an insurer when the injury is a result of an ‘excluded liability’. An excluded liability is an injury which occurs to someone who is a passenger in a vehicle which is stolen or unlawfully taken when they knew or had reason to believe that this was so at the beginning of the relevant journey.

In a recent case, a man who was seriously injured whilst a passenger in a stolen van, which was negligently driven by his brother, sought to argue that liability for his injuries was not an excluded liability. The ruling turned on the extent of knowledge that the injured person would have had to have had for him to have had ‘reason to believe’ that the vehicle was stolen or being unlawfully driven.

The decision was that for an injury to be an excluded liability for this purpose, it is not necessary for the passenger to know the vehicle was stolen or unlawfully taken. All that is necessary for the exclusion to apply is that the passenger would have had sufficient information to know or have had a reason to believe it was stolen or unlawfully taken if he had applied his mind to the information to hand. In other words if he could have formed that opinion based on thinking about the circumstances, that is sufficient to exclude an insurer from liability for the driver’s negligence.