QB-2019-000783 - [2025] EWHC 2038 (KB)

I indicated during the course of oral argument that I would add a short section to the judgment about the view I reached following oral argument about the status of English decisions in which judges of this court have made findings of fact about the content of Spanish law. During the course of submissions, it was recognised on behalf of the claimant that such decisions – findings of fact – were not admissible in these proceedings absent application under CPR Part 33 et cetera. There has been no such application here. The issue arose because in the claimant’s skeleton argument for this hearing there was extended citation of first instance decisions of this court that speak to the content of Spanish law. The defendant objected. It was right to object. It was submitted on behalf of the claimant that these decisions succinctly or elegantly summarise the Spanish law and in a way consistent with the evidence of the experts in these proceedings. I rely exclusively on the admissible evidence before me for determining any question of Spanish law. Ms Wyles accurately identified the three permissible sources of Spanish law: (1) the text of the legal provision (here Article 20); (2) the Spanish Supreme Court doctrine; (3) the expert evidence adduced in these proceedings.

I consider nothing else.

The defendant has set out with admirable clarity the reasons it submits its delay in paying compensation was justified or not attributable to it. The central reason advanced is that the claimant did not quantify his claim until very late in proceedings, with a schedule only provided in August 2024, that is three months before the trial. As Ms Wyles put it, “the submission here is that we did not know what is being claimed.”

First, and as a preliminary observation, I note that I received no evidence from the experts about where the burden of proof lies. The persuasive onus is not clear from the text of Article 20. I have not been provided with any Spanish Supreme Court (or indeed other Spanish) decision that illuminates the point. That said, I do not find this to be an impediment. To me, as will be evident, the case is clear, wherever the persuasive burden lies.

Second, I examine the obligations on an injured person and the insurer under Spanish law. Under Article 20(9), the obligation on the injured party is to make a claim for “payment of compensation”. It is agreed between the parties that by the claimant filling in the standard MIB form on 19 September 2017, he made a claim for the payment of compensation and therefore fulfilled that obligation. From that trigger point, the defendant as insurer is obliged to pay compensation within three months (I will come to what compensation it is required to pay shortly). However, the defendant paid no compensation before the expiry of the three-month period specified by Article 20(9). This is why the defendant accepts that it is in default.

Third, I consider what compensation should be paid. One must recollect that the text the parties made submissions on, and the court has been invited to consider, is translated from the Spanish. While the translated text in Professor Carreras’s report says that the obligation is to “satisfy the compensation”, no party suggested to the court that it means full payment within three months of the entire compensation that ultimately would fall to be due. Indeed, Mr Vincent specifically submitted on behalf of the claimant that the provision could not mean all the compensation that was finally due or later awarded because three months after the trigger notification it would be very difficult to be precise about the final level of compensation. It seems to me that there is force in this submission. This is, of course, a separate question from the date penalty interest should run from. It is agreed that it runs from notification plus three months; that cannot mean that all the compensation must have been paid by that three-month mark.

If then, the requirement is not to pay all the compensation, I next consider what an insurer should pay to avoid activation of penalty interest. This is a question I posed to both counsel. Mr Vincent submitted that it must be “something”, albeit not something trivial or tokenistic. I can accept the submission that a derisory amount, say 10 Euros, when very serious injuries are detailed in the notification form, is unlikely to be sufficient to avoid penalty interest, even if paid within the three-month window. Ms Wyles made the point that the defendant accepts it is default of the Article 20(9) obligation. Therefore, in one sense it does not matter much, as Mr Vincent submits, exactly what the insurer should pay before the close of the window. I note that there has been no Spanish case put before me that deals with this question head on. However, neither expert has suggested that the full compensation must be paid by the end of the three months. This would not be generally possible, I can entirely envisage, as it may be that just as in this case the injuries had not consolidated or assessments were still outstanding about their full extent. It seems to me that such matters do not remove the obligation under Spanish law to make some payment of compensation or, if not and falling in default, provide good reason for any delay. Ms Astigarraga gave evidence about this question. I should say that I had concerns about aspects of her evidence on certain critical points on other issues, as detailed in the substantive judgment. However, on the question of penalty interest, I found her evidence to be logical and reasonable. It was not subject to any material challenge, which supports this assessment. This is unsurprising as her evidence was largely in accordance with both Professor Carreras, the defendant’s expert, and the pronouncements of the Spanish Supreme Court. Ms Astigarraga’s evidence on this point came in an exchange in cross-examination:

Liability

I turn to a key consideration. At no point before the trial did the defendant make an offer to pay compensation or in fact pay compensation, a point the claimant places heavy reliance on. Ms Wyles is correct to point out that for the most part the claimant has been a protected person and there are court rules around that. That is not an unusual state of affairs in a serious personal injury case. It was possible to have made a voluntary payment, certainly when he did not have protected status. The defendant did not. One then examines the sequence and history. On 15 October 2020, the defendant accepted primary liability. Despite accepting such liability, it made no offer of compensation, nor paid any. Ms Wyles submits that “there is nothing in the expert evidence about offers”. This is true as far as the two experts before me are concerned. However, the Spanish Supreme Court touched on this point in its decision dated 7 February 2019. Its judgment is quoted in Professor Carreras’s evidence at B1407-08. Indeed, Ms Wyles cited the case in her submissions. It says as material:

“In general, in short, and invoking a clearly established model of conduct, the purpose of Article 20 Insurance Contract Law is to sanction the failure to pay compensation, or to offer adequate compensation, from the moment that an orderly insurer, having knowledge of the incident, would have satisfied or offered it.”

To me, two matters are noteworthy. First, that the Spanish Supreme Court speaks of “having knowledge of the incident”, not being in receipt of detailed or precise quantification of the claim. As Ms Astigarraga stated, again without challenge, in Spain the trigger notification is “a simple letter of one page informing about the existence of the accident and the injuries, and no medical evidence is generally attached.” What the Spanish court then scrutinises is the “attitude of the defendant” on its receipt. Second, the Supreme Court mentions in terms not just the failure to pay compensation but the failure “to offer adequate compensation” and will consider whether the insurer has satisfied its obligation by having “offered it” (compensation). Thus, I cannot accept the conclusion Ms Wyles invites the court to reach that the question of offers of compensation is a “red herring”.

When an insurer seeks to justify its delay in paying compensation, it seems to me that it is obvious that in the absence of any concrete payments of compensation, offers of compensation must plainly be relevant as the Spanish Supreme Court states in terms. This is because they indicate the insurer’s attitude and approach. This clearly is a relevant factor, as Ms Astigarraga informed the court in evidence without challenge or contradiction. It would be curious indeed if the court ignored a situation where an insurer had made an offer of nearly full compensation which the claimant had rejected. Testing the argument in that way makes it clear that offers of compensation are relevant to the attitude of the insurer and the reasonableness of its subsequent conduct when it seeks to be relieved of the penalty interest sanction following its admitted initial default.

Of further significance is that on 12 September 2017, it was established that the driver of the Spanish vehicle was uninsured. Under Spanish law, it is agreed and for reasons explained in detail in my substantive judgment, the maximum contributory negligence that can be attributed to the claimant in the circumstances of an uninsured driver is 75 per cent. In the end, my finding was that the claimant was 65 per cent responsible for the incident and his ensuing injuries. Nonetheless, despite a minimum residual level of 25 per cent responsibility following the acceptance of primary liability in October 2020, the defendant made no offer of compensation before trial.

The central plank of the defendant’s resistance to penalty interest is that the claimant did not quantify his claim until the schedule of loss in August 2024. To assess the merits of this argument, one must examine the nature of the information available to the defendant at different stages. I first examine the MIB notification form dated 19 September 2017.

The claimant said he was a pedestrian. He gave the name of the driver and the vehicle registration number, stating that he got the details from the police. The circumstances of the accident were that the driver failed to see the claimant and “drove his vehicle into [DHV]” as he was crossing the road. This caused him to be “knocked down and then dragged along the road as the driver failed to stop”. The form adds that the claimant “suffered severe injury, loss and damage”. At Box 11.14, the claimant confirmed that he had sustained personal injuries. At Box 11.15, these were described as “very severe brain injury along with multiple orthopaedic injuries.” At Box 11.16, in answer to the question “Are you still suffering from these injuries?”, the answer was “Our client is still suffering from the effects of the injury and has immediate needs of rehabilitation.” The injury was said to prevent him from returning to normal work or completing “normal daily activities”. The name of the hospital in Mallorca was given and it was said that the claimant had stayed in hospital as an inpatient for “48 nights”.

The next information to consider comes from an Immediate Needs Assessment (“INA”) dated 6 October 2017. It was based on an assessment of the claimant’s condition on 21 September 2017. The assessment was made by a case manager Kate Wright. At Section 2.2, Ms Wright detailed the injuries listed in the discharge summaries from the two hospitals in which the claimant had been treated, in Spain and in England.

“2.2.1

As reported in the Discharge Summary from Son Espases Hospital:

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Sub-arachnoid haemorrhage (bleeding below the arachnoid layer of the membranes surrounding the brain).

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Interhemispheric subdural haematoma (bleeding below the dura layer of the membranes surrounding the brain).

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Right frontal subdural haematoma (bleeding below the dura layer of the membranes surrounding the brain).

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Signs of cerebral oedema (swelling of the brain).

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Longitudinal fracture of the left petrous temporal bone (skull fracture of the temporal bone).

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Fracture of the nasal bones.

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Fracture of the right scapula (shoulder blade).

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Ipsilateral ilio-/ischiopubic fracture (pelvic fracture).

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Right costal fractures (rib fractures).

2.2.2

As reported in the Discharge Summary from The Royal Surrey County Hospital:

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Right frontal contusions (bruising to the front right side of the brain).

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Bi-lateral sub-arachnoid haemorrhages (bleeding below the arachnoid layer of the membranes surrounding the brain on both sides of the brain).

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Subdural haematoma – unsure if this was evacuated in Spain* (bleeding below the dura layer of the membranes surrounding the brain).

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Left temporal fracture (skull fracture of the temporal bone).

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Nasal bone fracture.

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Right complex scapular fracture.

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Right acromio-clavicular (top of the shoulder) joint injury.

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Right ribs 1 and 9 fractures.

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Right acetabular/pelvic fractures.

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Large superficial wounds to left upper back and shoulders.

Ms Wright provided an additional note:

“*Please note that The Royal Surrey County Hospital have intimated that [DHV] may have had brain surgery to remove (evacuate) his sub-dural haematoma. This procedure is not listed in the discharge summary from Son Espases Hospital, nor were [the claimant or his former girlfriend] ever aware of any neuro surgery having taken place.”

It seems to me that here was a substantial body of information highly relevant to the question of whether any meaningful quantification of the claim was possible to enable any payment of at least some compensation. An exchange during Professor Carreras’s cross-examination supports this conclusion: