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Keeley v Pashen & Wren Motor Syndicate 1202 At Lloyds, Court Of Appeal, 10 November 2004

16 November 2004
The issues

Insurance – Motor Insurance – Limitation Of Use – When A Car Being Driven For Hire And Reward Or For Social, Domestic And Pleasure Purposes When Trying To Run Down Pedestrians.

The facts

The Defendant Pashen was a minicab driver. He used his own car. He had been working for Sapphire Cars a Mini Cab Firm in Penge, for about three months. He had begun work on the day in question about 2.00 p.m. The last job of the night was to collect Mr Keeley and three others. They were drunk and messed around inside the car. Mr Pashen complained and said that he was attacked. He drove them to where one of them wanted to go. All four left the mini cab and Mr Pashen continued to the junction of Oakfield Road and Penge High Street. Mr Pashen said that the men ran towards the junction – in any event they continued on foot towards it. Mr Pashen decided to reverse and when he had passed the men stopped and drove his car at them. Mr Keeley sustained fatal injuries.

He was later convicted of manslaughter a plea which was accepted because the sentencing Judge accepts that he was driving in a state of panic and had merely intended to frighten the men and that he was going at less than 15 mph and did not really intend to cause serious harm. He had an insurance policy covering third party fire and theft and a certificate limited use for social, domestic and pleasure uses only including travel to and from permanent place of business. It excluded cover use for hire and reward.

The widow of Mr Keeley subsequently brought out an action against Mr Pashen which claim was settled for £235,000 in May 2003.

An issue arose as to cover. The MIB were not involved in proceedings since no notice of claim had been given to it in the seven days following the issue of the claim on 18th February 2002. The Judge found that Mr Pashen was not using the car for social, domestic and pleasure purposes when he drove it at the four men. The Claimant appealed. The Second Defendants cross appealed against the Judge’s further finding that Mr Pashen was not using the car for hire or reward because that use had stopped when the four men had got out of the car.

The decision

The Claimant brought a claim for amongst other things psychiatric illness. It had not been suggested that the phrase “bodily injury” in Section 145 of the 1988 Act did not include psychiatric injury. Therefore the Claimant having obtained Judgment against Mr Pashen should be able to enforce her Judgment against his Insurers unless they could show that the liability was not one covered by the terms of the policy.

In Seddon v Binions – Court of Appeal said there was no firm principle under which it could be predicted whether particular use should fall within social, domestic or pleasure purposes or not. A solution the Court of Appeal had said lay in asking the question “what was the essential character of the journey in the course which the particular accident occurred”.

By applying this test, the Judge was right to hold Mr Pashen has not driving his car for hire or reward at the critical time because his last fare paying passengers had left the car. There was no evidence to the effect that somehow or other the period during which he used his car for hire or reward began and ended at the minicab office.

The Judge was wrong however to find that Mr Pashen was not driving his car for social, domestic and pleasure purposes. After he dropped the four men the essential character of his journey was to drive his car home – a purpose covered by the policy. A deviation (reversing and driving towards the men in order to frighten them) from the journey did not qualify as a separate journey. Although Mr Pashen might be able to recover under his policy, this did not disqualify the Claimant from enforcing her statutory rights under Section 151 of the 1998 Act. Appeal allowed – cross appeal dismissed.

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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