• In the case of Delaney v Pickett [2011] E.W.C.A. Civ 1532, it was held that a passenger could not claim under the Motor Insurers’ Bureau Agreement after injury while in possession of cannabis with intent to supply because the vehicle was being used in the course or furtherance of a crime. ‘Crime’ could not be read as being restricted to ‘serious crime’ as that would leave the clause with little practical purpose.

Facts of the Case

  • On 25th November 2006, D1 arrived unannounced and unexpectedly at C’s home in the evening. The two left to go ‘for a drive in his powerful sports car.’
  • D1 drove at high speed, overtook a vehicle near some bollards, passed them on the wrong side of the road and, despite trying to swerve back into his nearside, collided head-on with an oncoming people carrier.
  • An ambulance arrived within a minute of the accident. Two fire engines removed C and D1 from the car. Both were found to be carrying cannabis. The combined street value of both packages was found to be at least £674.
  • On 7th March 2007, D1 was interviewed by the police. D1 admitted to smoking cannabis every day. D1 stated C had not bought from the same supplier and he only intended to use it personally.
  • On 20th December 2007, D1 was sentenced to 10 months imprisonment. D1 pleaded to possession of both his own and C’s supply.
  • The judge at first instance held that D1 and C had intended to drive to meet a dealer and jointly bought the supply cannabis with intent to supply based on the cost and quantity of the purchase.
  • C brought a claim against D2, the insurer, for failing to pay out on the grounds that the vehicle was being used in furtherance of a crime, that being to sell cannabis.

Issues

  • Was the judge correct in finding that C and D1 had intention to supply?
  • If so, was the supplying of cannabis a serious crime to justify D2’s refusal to pay out on the grounds that the vehicle was used to further a serious crime?

Held by the Court of Appeal (Civil Division)

  • Finding for D2, that the judge had been correct to find on the balance of probabilities that C and D1 had intended to transport illegal drugs. As such, C could not claim from D2 as the vehicle was being used to further a crime.
  • Finding For C, that the damage suffered by C had not been caused by his or D1’s criminal activity. It had been caused by D1’s negligent driving. In those circumstances, the illegal acts were incidental, and C was entitled to recover his loss from D1.

Richards L.J.

  • I agree with the judge at first instance. No significance could be attached to D1 being charged with simple possession of the cannabis, not intent to supply, or C not being charged at all. A Crown’s prosecutor’s decisions on the criminal standard of proof have no bearing on a civil judge’s assessment on a different standard.
  • “Mr Featherby, for the insurers, did not contend that the exclusion applies to any crime, however minor, but submitted that it does apply where the conduct is so reprehensible that it deserves public condemnation…For my part, I would readily read the clause as being subject to an implicit de minimis exception, but I am not prepared to read into it a qualification as heavy as that favoured by Ward LJ, which would, as he recognises, leave the clause with little, if any, practical purpose. Even if one treats ‘crime’ as a reference to ‘serious crime,’ I take the view that the possession of a commercial quantity of cannabis with intent to supply is a serious crime to which the clause applies; and given the judge’s finding that the very purpose of the journey was the transportation of the illegal drugs, the situation seems to me to fall squarely within the wording of the clause and the policy that underlies it” [68].

Ward L.J. (Dissenting)

  • How C would intend to supply cannabis is unclear, given his only offence relating to cannabis occurred 15 years prior.
  • D1’s conduct towards D does not indicate a pre-mediated joint activity to obtain and resell cannabis. C knew D1 was a heavy user, so the conditions of the car and finding cannabis inside would not condemn C.
  • D2’s agreement cannot mean any crime at all justifies excluding C from compensation. Furthermore, there is not enough evidence that C knew about D1’s intent to purchase and resell cannabis; C should not suffer for D1’s crime.
  • “There is no need for an analysis of the pleadings to establish whether or not C is relying on his illegality to found his claim. It is not a question of C profiting from his own wrongdoing…Viewed as a matter of causation, the damage suffered by C was not caused by his or their criminal activity. It was caused by the tortious act of D1 in the negligent way in which he drove his car. In those circumstances the illegal acts are incidental, and C is entitled to recover his loss” [37].

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