1. Solatium doloris in the practice dr. Szilvia Szabó XIII. AIDA Budapest 28 November 2014

2. 2 Agenda 1.Some introductory remarks 2.Solatium doloris in the liability insurances 3.Claims based on other insurances 4.Insurer’s liability under breach of contract and tort law 5.New challenges in the practice

3. Reasons why we have to talk about it already  The new Civil Code and its reasoning do not specify the category of “insignificant injury” – there is no legal “minimum limit” for behaviour resulting legal consequences  The category of “insignificant injury” has been defined by legal theory – it has to be accepted by court practice as well  Insurers handle a large number of cases of this type – the insurers’ role is significant in development of the legal practice  The establishment of practice starts with the handling of the first claims  Possible impact: - Every MTPL claim without personal injury involves paying solatium doloris - In the case of severe personal injury claims the sum of claim payment may increase

4. Initial experience: compulsory motor liability insurance Subject matter: The vehicle suffered damage in the course of the accident, but there was no personal injury Injured party’s reasoning: fright, fear of sitting in cars, the absence of the car caused physical difficulties, the children’s fright caused the parents emotional suffering Claims and the insurer’s position:  A reversing lorry crashed into a couple’s car: husband claimed HUF 100.000, wife claimed HUF 700.000 – rejection  The car crashed into a lorry. The couple were shocked and their family and social life suffered: HUF 100.000 – rejection  An overtaking bus passed the car to the central barrier of the motorway: Claimed sum not specified – rejection  A vehicle taking a turn crashed into the injured party’s car: HUF 200.000 – rejection  Two further cases: one of the injured parties claimed HUF 80.000, the other HUF 120.000 - rejection

5. Borderline cases of compulsory motor liability insurances I Subject matter: The accident caused insignificant injury (e.g. cuts and bruises, superficial wounds not requiring any medical treatment) Injured party’s reasoning: infringement of the right to safety and health, pain, being far away from children, fright, fear Claims and the insurer’s opinion:  4 members of a family suffered small injuries. One child was diagnosed with abdominal bruise in the hospital, than he was allowed to go home. Claimed sum not specified – HUF 35.000 claim payment under settlement  Abdominal bruise was diagnosed without any additional difference. Injured party was on sick leave for two weeks. Claimed sum not specified – HUF 50.000 claim payment under settlement  Bruise on the knee, had to be driven to work by partner for 3 weeks. Claimed sum of HUF 100.000 – HUF 100.000 payment

6. Borderline cases of compulsory motor liability insurances II  Bruises on the chest and the abdominal wall, injury on the back of the hand, strain of the neck. Claimed sum of HUF 1,2 million – rejection  Abrasions at the eyebrow and on the forearm, black eyes. Claimed sum of HUF 200.000 – rejection  A four-member family suffered an accident. The safety belt caused small injuries to the two children and because of the children’s injuries the parents suffered emotional pain. Claimed sum of HUF 1 million per child, HUF 500.000 – 500.000 for parents Other interesting cases:  A pedestrian’s bones were broken and he suffered bruises. He claimed solatium doloris of HUF 5 million. Under the rules of new Civil Code he claimed a significant sum in advance (HUF 3 million). – The sum of the solation doloris can be specified when the injured party’s health condition has become final.  The injured party suffered a fracture of ribs and bruises on the chest. The injured party requested payment of solatium doloris only supported by medical documents proving the fact of injury. - Sum of the solation doloris can be specified when the injured party’s health condition has become final.

7. Arguments we can use Opinion of the Civil Department of the Appellate Court of Budapest, No: 1/2013 (VI. 17.) Dr. Ambrus Molnar (Justice in Curia): Theoretical and practical issues of solatium doloris The injured party has to prove the infringement of personality rights (e.g. sleep deviation because of the accident). Injuries not reaching the level of infringement of personality rights cannot be considered as sufficient grounds for solitium doloris. External effects can be seen as violating the dignity of human beings only if they potentially cause disturbance in the injured party’s life and affect his/her future decisions, actions. Everyday activities – e.g. transport – involve risks. E.g. of suffering an accident. Application of the solation doloris requires a severe and serious illegal behaviour. If an accident is caused by the injurer’s insufficiency, then feelings of fright or/and inconveniency do not reach a level requiring the involvement of the legal system. The general financial situation of the society has to be considered.

8. Professional liability insurances I Subject matter: An injured party fell in a hotel, suffering head injury. Injured party’s reasoning: physical injury, relatives failed to enjoy their holidays Claimed sum and the insurer’s opinion: injured party’s claim HUF 500.000, sun and brother HUF 100.000 each – Rejection on the grounds that the hotel cannot be blamed. The relatives’ claim involves no payment even if the hotel can be blamed. Subject matter: Court ordered enforcement failed for several years Injured party’s reasoning: Infringement of the right to property and health Claimed sum and the insurer’s opinion: HUF 3 million - rejection

9. Professional liability insurances II Subject matter: Bailiff seized the company’s share (company is the injured party) Injured party’s reasoning: Damage to the company’s reputation Claimed sum and the insurer’s opinion: HUF 1 million – rejection (possible reasoning: BH2003. 108.) Subject matter: Injured party sat down on a piece of furniture in a department store which collapsed. The asthmatic injured party suffered an asthmatic attack. Injured party’s reasoning: Fright, infringement of the right to health Claimed sum and the insurer’s opinion: HUF 50.000 - rejection

10. Other insurances Subject matter: The client suffered a sky accident. The client alleged that the insurer had failed to organize hospital treatment in an appropriate way, so he and his wife were very annoyed. The ambulance driving him home was uncomfortable and went too fast. Injured party’s reasoning: Damage to health, severe pain, violation of the right to human dignity Claimed sum and the insurer’s opinion: HUF 1,8 million – rejection Reasoning: The injured party has to prove the infringement of personality rights. The injured party’s statement on its own is insufficient proof. Subjective feelings of inconvenience cannot be sufficient grounds for solatium doloris.

11. Insurer’s liability under breach of contract and tort law I Subject matter: The insured party did not have valid MTPL insurance - found out during a police roadside check. Fine: HUF 20.000. He appealed to the court. Injured party’s reasoning: The insurer failed to prove that they had posted a letter about the cancellation of his policy, and he had to go to court because his MTPL policy had been cancelled. Claimed sum and the insurer’s opinion: HUF 30 million – rejection. Reasoning: Failure to comply with a deadline or taking legal action on its own cannot be considered as infringement of personality rights. Infringement of the rights can be established only if the injury has been committed because of essential features of injured party’s personality. (case reference: EBH2007. 1598)

12. Insurer’s liability under breach of contract and tort law II Subject matter: The insured party reported that a window had been broken. The insurer requested further documents, but the letter came back undelivered with remark “addressee died”. The insurer sent another letter addressed to “Mrs XY’s Heirs”. Injured party’s reasoning: She is an old lady, and her dignity was violated because the insurer considered her dead. Claimed sum and the insurer’s opinion: Claimed sum not specified – rejection. Reasoning: Firstly: the insurer cannot be blamed in this case. Secondly: a mistake in the course of administration cannot be considered infringement of personality rights, subjective feelings of inconvenience caused by this type of behaviour cannot reach a level requiring legal protection (case reference: EBH2007. 1598. and Opinion of the Civil Department of Appellate Court of Budapest)

13. And things we can do Increasing awareness of insurers’ role in establishing legal practice Priority claim handling and monitoring Consistency in claim handling practice Choosing to get involved in litigation even if the claimed sum of solatium doloris is low Involvement of the best experts to create high-level legal arguments 13

14. Köszönöm a figyelmet! 14