Churchill Insurance v Charlton: CA 2 Feb 2001

The victim of an unlawful act of a driver off-road sought damages from another driver and his insurers. The insurers refused to pay.
Held: There is a balance to be found between the statutory purpose of compulsory motor insurance and the principal that a man should not benefit from his own wrongful act. The victim stood in the shoes of the insured as against the insurance company. He therefore had no better claim than the insured, and was subject to the defences available to the insurer against the insured.
Laws LJ said: A useful starting-point, I think, is to have in mind two contrasting propositions, neither of which (taken in isolation) can sensibly be doubted, but which would appear at face value to be inconsistent with one another.
The first of these proposition consists in the general rule that an assured is not covered by an insurance contract in respect of loss caused by his own intentional act: see for example Beresford [1938] AC 586 per Lord Atkin . . Rix LJ has described this as ‘a basic rule of insurance law’ . . Lord Atkin stated that the proposition ‘is not the result of public policy, but of the correct construction of the contract’. But public policy would surely vouchsafe at least as much, at any rate in a case where the intentional act in question was also a crime.
The second proposition is derived from the following state of affairs. The user of a vehicle is required by statute (on pain of criminal penalties) to be insured in respect of any liability which he may incur by virtue of the death of or personal injury to any person (or damage to property) which is occasioned by the use of the vehicle on a road in Great Britain, and this includes the case where the injury is deliberately and criminally caused: Road Traffic Act 1988 ss. 143(1)(a), 145(3)(a), Hardy [1964] 2 QB 745, Gardner [1984] AC 548. This state of affairs entails the conclusion that there is a class of case in which a policy of motor insurance may as a matter of construction cover the assured against losses caused by his own intentional and criminal act (else the statute would be incapable of fulfilment in relation to a category of possible events which, upon high authority, was plainly intended to be covered). This conclusion constitutes the second proposition. On its face it is inconsistent with the first proposition or is an exception to it.
It will be obvious that there are two public policies involved here. The first is the broad principle of the common law that no man may rely on his own wrong to gain advantage or benefit against another. That is behind the first proposition. The second is the principle of statute, that innocent third parties should be protected so far as money can do it from the harm – sometimes fatal – that may be inflicted by careless, dangerous and criminal drivers on the public roads: a protection not sufficiently given by the private law of insurance. That is behind the second proposition. The tension between the two arising where the driver’s conduct is criminal is resolved by the rule (derived from Hardy v MIB, confirmed in Gardner’s case) that a policy whose words on their face cover liability for death, personal injury or damage to property occasioned by the use of a vehicle on a road is treated – so as to give effect to the second proposition – as still doing so even where the liability arises on the facts from the driver’s own criminal act; although in that case – so as to give effect to the first proposition – the insured driver himself cannot take advantage of the policy . .
In my judgment a policy, such as that in the present case, whose insuring clause contains the word ‘accident’, may readily fulfil the requirements of s.145(3)(a), even in relation to a set of facts where the insured’s liability arises from his own deliberate criminal act. I have no difficulty in accepting that ‘accident’ and its cognates may be applied so as to cover such a set of facts: depending on the context of the word’s use, they plainly can. Billingham [1979] 1 WLR 747 and Lees [1981] RTR 506, cited by my Lords, vouchsafe as much.
Moreover, if the court’s view of ‘accident’ is conditioned by the force of the first proposition, there at once arises the danger of an approach being taken to the material provisions of the 1988 Act which would undermine the purpose and utility of section 151. As Rix LJ says . . the first proposition – the basic rule – applies whether or not the word ‘accident’ appears in the policy. In theory one might, driven by the first proposition, arrive at a result such as would not allow any policy of motor insurance (whether or not containing the word ‘accident’) to cover the insured’s liability for damages caused by his own deliberate criminal act; but that would contradict entirely the second proposition. Once one recognises (a) that in the field of motor insurance the role of the first proposition is only to disable the insured from recovering for his own benefit in a case of deliberate criminal conduct, and (b) that the policy may nevertheless and at the same time be treated as one which for the purposes of sections 143 and 145 insures the driver against liability for death (etc) in just such a case (and that is the effect of Hardy . . and Gardner . .), it becomes apparent that the presence or absence in the insuring clause of ‘accident’ or its cognates is of little or no significance.’


Laws, Kennedy, Rix LJJ


Gazette 08-Mar-2001, Times 21-Feb-2001, [2001] EWCA Civ 112, [2001] EWCA Civ 1230, [2002] QB 578, [2001] RTR 33, [2001] Lloyd’s Rep IR 387, [2001] 3 WLR 1435, [2001] PIQR P23, [2001] 1 All ER (Comm) 769


Bailii, Bailii


Road Traffic Act 1988 151, Third Parties (Rights Against Insurers) Act 1930


England and Wales

Cited by:

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CitedBristol Alliance Ltd v Williams and Another QBD 1-Jul-2011
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CitedMulcaire v News Group Newspapers Ltd ChD 21-Dec-2011
The claimant, a private investigator had contracted with the News of the World owned by the defendant but since closed. He had committed criminal offences in providing information for the paper, had been convicted and had served his sentence. He . .
Lists of cited by and citing cases may be incomplete.

Insurance, Road Traffic

Updated: 19 May 2022; Ref: scu.78992