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AIDA 2014 ROME, October 2014 Personal damages and insurance in EU

AIDA 2014 ROME, October 2014 Personal damages and insurance in EU. Prof. Avv. Diana Cerini. Personal damages in EU :. Preliminary questions : Do we have a common law? Shall we harmonize ?

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AIDA 2014 ROME, October 2014 Personal damages and insurance in EU

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  1. AIDA 2014ROME, October 2014Personal damagesand insurance in EU Prof. Avv. Diana Cerini

  2. Personal damages in EU: Preliminary questions: • Do wehave a common law? • Shallweharmonize? • Whatis the impact on insurancecontract law and free circulation of insuranceservices ? Prof. Avv. Diana Cerini - AIDA 2014

  3. Personal damages in EU: «Inside» eachlegalsystem: let’sthinkabout some of the problems: 1) Terminology? Patchwork of names for personal damages: Es. Common law: general and special, nominal and substantial, contemptous and aggravated, and so on 2)Whoisentitled to recovery?Uncertainty on the number and categories of subjectsentitled to getrecovery (variability of damages «par ricochet») Prof. Avv. Diana Cerini - AIDA 2014

  4. 3) Amount of moneyinfluence of economicconditions of the country 4) When and where? Claimsolution and time for justiceproceeding/ ADR Prof. Avv. Diana Cerini - AIDA 2014

  5. In Italy • In Italianterminology: twomacrocategories: • Patrimonialdamages • Non patrimonial (non pecunary) damages: butthese are name of the courts and of the legaldoctrine, notneessarily of the legislator - only in Code of Private insurancewehave for the first time a clearreference to specificdamages BUT in anycases, non patrimonialdamageshave a synphony of names…. Prof. Avv. Diana Cerini - AIDA 2014

  6. So, in the EU contest: Differenttermonology BUT MOST OF ALL  (Very) Differentamount of moneyrecognized for a specificdamage: the sameperson can get a sum «x» in a country, and «x minus y» in another country. Prof. Avv. Diana Cerini - AIDA 2014

  7. Whatis the situation in EU MemberStates? In manystatesdifferentstrategiestu reduce uncertainty France: • «RapportDinthillac» trying to introduce omogeneousterminology • Uk: reports and analysis by the Law Commission… Prof. Avv. Diana Cerini - AIDA 2014

  8. Shallweharmonize? Beforeanswering: the realproblemisthatlegalsystems and law in action are often «obscure» Courtsnotalways call things with theirrealname: let’smake the example of punitive damages: in many of the EU legalsystemsp.d. are actuallyforbidden in tort law: the orthodoxic idea isthat the victim can obtainonlycompensatorydamages Butisthat «trulytrue»? ? Prof. Avv. Diana Cerini - AIDA 2014

  9. See the Italian Case…Ex. 1: Punitive/compensatorydamages • In principle: onlycompensatorydamage can be paid BUT…. Sometimes moral damages are so high thattheyprobably include something more…: Decision by the Milan Tribunal in a medmal case and liability of the hospital/insurers (seealso The «Lodo Mondadori» decision by the Court of Cassation…. (Cass., sez. III civ., 21255/2013 on appeal against Court of Appeal Of Milan) Prof. Avv. Diana Cerini - AIDA 2014

  10. Ex. 2: Patrimonialdamagesas a consequence of personal damage:TwoItaliandecisionsdated 2014 • Decision 1: Cass. 10 th March 2014 no.5504 • Decision 2: Cass. 24th June 2014 no. 13537. • What do theyhave in common ? • 27 years for the proceedings (from facts to decision)! • Twovictims, twocases of motorliabilities and insurance Prof. Avv. Diana Cerini - AIDA 2014

  11. But… • Decision I: with reference to patrimonialdamage of relatives of the victim: « thereis nocompensatio lucri cum damnobetween the sumspaid by the social insurers to the heirs for pensionallowance and the sum to be paid by the liable party (and itsinsurer)…. • Decision II: thereiscompensatio lucri cum damno Samechamber of the Court of Cassation !!! Prof. Avv. Diana Cerini - AIDA 2014

  12. Ex 3: Non patrimonialdamages: damage for death • Decision I: «San Martino Decisions» - 2008 • Decision II: “Sentenza Scarano” – 2014 So: • No certainty • No predictability Prof. Avv. Diana Cerini - AIDA 2014

  13. Butlet’sconsider…. Predictability – consistency  1)For victims: essentialtool of a legalsystem in order to realizeequality and non discrimination  2) For professionals: especiallyinsurance companies: essential in order: - to correctlymanage the risk • to set the right premium Prof. Avv. Diana Cerini - AIDA 2014

  14. Predictability and consistenty 3) In general: • Reduce transactionalcosts • Reduce litigation Prof. Avv. Diana Cerini - AIDA 2014

  15. Whatis EU doing? • Soft law proposals: EuropeanPrinciple on Tort law • Studies and other non bindingproposals: PEOPIL • European Court of Justice at the border…. • ECHR : fewdecisions and wuthreference to veryspecifictort situation, low impact for the moment Prof. Avv. Diana Cerini - AIDA 2014

  16. ECJ decisions • C-371/12, Petillo e Petillo/Unipol Assicurazioni S.p.A. • C-22/12, KatarínaHaasová / RastislavPetrík e BlankaHolingová • C-277/12 VitālijsDrozdovs / Baltikums AAS EU Law doesnotdirectlyinterfere with determination of personal damage Prof. Avv. Diana Cerini - AIDA 2014

  17. A common law for personal damages? • See some Opinions: PEOPIL reports: From one side: «Thisquestionmay look like a cleverone, butitisbecomingevidentthatitis no longer a matter of yes or no: harmonisationisalreadyat work atdifferentEuropeanlevels …» Prof. Avv. Diana Cerini - AIDA 2014

  18. Opinion of PEOPIL group B)From the other side: The differencesbetween the Europeansystems of personal injurycompensation are muchgreaterthan the points in common «Europeanlegalsystems are too far apart to contemplate unification or minimum harmonisationstraightaway. Moreover, from a comparative perspective, thereis no single nationalcompensationsystemwhichconstitutes a sufficientlyprestigious model throughout Europe to influence and direct the systems in force in the otherMemberStates» Prof. Avv. Diana Cerini - AIDA 2014

  19. So: • Too differentstartingpoints • Absence of a «model» to refereto Prof. Avv. Diana Cerini - AIDA 2014

  20. Butasweallknow:incredible impact on insurance • Tortcompensationisstrictlyconnected to insurance • In the majority of the legalsystems, a very high percentage of claims for liability (from 85-95%) are againstinsurers(no «sole» liable parties) thatmeansthatinsurance can havegreatinfluence on the level of compensationawarded Prof. Avv. Diana Cerini - AIDA 2014

  21. Influence of insurance on compensationlevels: 1) From one side, compensation awards rarelyoverpass maximum insurancesums the realdefendantisalways the insurance company (presence of insuranceas a cap to the compensationawarded) 2) Level of award ispushedat the insurancelimit (insuranceas a factorthatincrease in the amount for part of the cases)  lobby can the creation of a harmonizedinsurancecontract law help? Prof. Avv. Diana Cerini - AIDA 2014

  22. Actually in Europe -part of the insurancecontract law isdirectlyharmonizedi.e. directivesconcerninginsurancecontracts, especially on information duties, right of withdrawal, etc. Part of the insurancecontract law isindirectlyharmonized i.e. directivesconcerningunfaircontractterms - Part of the insurancecontract law isnotharmonized especially general rule on liabilityinsurance Prof. Avv. Diana Cerini - AIDA 2014

  23. Compensation and Single Market for Insurance • Problem for cross borderlitigation: legaluncertainty, scarceknowledge of the market • Problem for free movement of insurance companies and insuranceservices • Lesscompetition in insurance Prof. Avv. Diana Cerini - AIDA 2014

  24. Whatis EU doing for insurancecontract law? • Consultation with stakeholders • Creation of a Group of Expert (2013) • New calls for measureseffect of legaldifferences in EU country legisation Prof. Avv. Diana Cerini - AIDA 2014

  25. Group of Experts on InsuranceContract Law EU Commission – 2013/2014 • Commission Decision of 17 January 2013 an Expert Group on a European Insurance Contract Law, OJ 2013 C 16/6 (Commission Decision).  Identifyobstacles to free circulation of insuranceproducts and services • General report , passim and sectionfive in particular what are the obstacles to free circulation of liabilityinsurance (especially, butnotonly, in motorliabilityinsurance and medmalinsurance)? Prof. Avv. Diana Cerini - AIDA 2014

  26. Expert Group General Report: “7. The legal framework of liability insurance is particularly complex due to the involvement of third parties, the interrelation with liability law, and the variety of duties to insure imposed by national legislation or regulation. While it is not easy to isolate issues of pure insurance contract law, a number of legal divergences have been identified as causing costs and uncertainty. This notably applies to the various differences concerning compulsory insurances, to rules on the mitigation of loss, in particular on the cover of legal expenses incurred for the defence and on the time-span of the insurer’s liability. The applicable rules on insurance contract law are only one element in the decision to offer cross-border liability cover alongside others; they do not appear to be the main element”. Prof. Avv. Diana Cerini - AIDA 2014

  27. General report : • Rules on liabilityinsurance: • Direct action /absence of directaction • DifferentPrescriptionlimit • Existance of an automaticsubrogation/non automotic BUT aboveall • Differenttort law and amount of recovery • Impact on insurancecontract: ex. differences in setting minimum coverage: the amount of the minimum sum set by the law (if any) is strictly influenced by considerations relating to the awards made to victims in a specific country. • Differences in judicial certainty • Time • Predictability Prof. Avv. Diana Cerini - AIDA 2014

  28. Some Conclusions: • Circulation of insuranceproducts, especially in laibilityinsurance for motoraccidents and medmal, are deeplyconcerned • Free circulation of insuranceservicesfind a major obstacle in the existance of differentmodels and amount of compensation • Unpredictability and uncertainty are a major obstacle for localaswellas for foreigninsurerswilling to enter a member state market. Prof. Avv. Diana Cerini - AIDA 2014

  29. Thankyou Further notes in the full report! diana.cerini@unimib.it info@studiolegalecerini.it Prof. Avv. Diana Cerini - AIDA 2014

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