Biker may be forced to pay thousands after banned new owner has fatal crash

Loophole leaves previous owner liable

Posted: 2 September 2014
by Visordown News

A BIKER could be forced to pay tens of thousands of pounds after a man had a fatal crash on the motorcycle he had sold him just days before.

A loophole in insurance law could mean 48-year-old Paul Duffy is liable for all costs involved with the accident that killed banned driver James Bryson.

Bryson was riding uninsured when he crashed into a Toyota Yaris near Arbroath, Scotland, just seven days after buying the bike. But because Duffy forgot to cancel his insurance policy, MCE insurance brokers say they are liable for the accident and can claim the costs back from him in court.

Duffy, who is recovering from leukaemia and looks after his disabled wife, said: ‘Lawyers said that because Mr Bryson had died and had no insurance, they would be paying out on my policy.

'Because he chose to buy my motorcycle, I am, in the eyes of the law, giving him permission to ride the bike and I am in breach of my contract. So if I have any assets, MCE can take them from me to recover costs.

'I am effectively having to pay for an uninsured driver having a fatal accident.

'I have never broken the law. I don’t even have as much as a speeding ticket.

'But I have been told this is the law, and I have no protection or rights.

'I honestly thought that once the bike was sold, it was no longer my responsibility.

Bryson, 28, was serving a four-year driving ban and had only just been released from prison after attempting to evade three police vehicles in a friend’s car while nearly three times over the drink-drive limit.

The father-of-one was unable to be saved by paramedics after crashing the £3,500 Kawasaki ZX10R next to a stone wall on Seaton Road.

Paul, from Fife, is now warning all drivers to immediately cancel their insurance policies on any vehicles that they sell.

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Discuss this story

To be honest, every policy has a clearly worded section on this, and has been brought up many times before.

If you have insurance, and you no longer own the bike, then remove any trace of liability, cancel that policy, record when you sent the V5 off and really cover your own back.

If the insurance is still operating, because you don't want to pay to cancel, or your building up your no claims rather than cancel, then I'm afraid you run that risk, by insuring you still have an interest in that bike, as you are personally gaining by not cancelling.

Put the boot on the other foot, you've been hit by a disqualified rider, you don't care if that bike is insured by the rider, or just has a valid policy, you want to be up and running with a new bike ASAP, so claim on the active insurance policy to get your money back.

Although I am in agreement that as soon as a V5 registers a change of owner this should auto kick off an insurance cancellation for the owner, so we have accurate ANPR in-case the new owner doesn't insure it.

Posted: 02/09/2014 at 10:49

I have to agree here, it's not exactly a 'loophole' really as it's all there in black and white. I do feel sorry for Mr Duffy though.

Seems as if James Bryson wanted to go out in the same way he lived his life; causing as much hassle for everyone else as possible.

Still, at least the twat is dead. Every cloud, and all that...

Posted: 02/09/2014 at 11:17

There is no loophole here, it seems Mr Duffy has been incredibly badly advised.

This seems to be getting hyped up a little in a "Daily Mail" style. Whilst it is difficult to comment without having the full file of papers in front of me, if the original owner can clearly demonstrate he had sold the vehicle, even though he has been slow to notify his insurers, he has no "insurable interest" in the bike and his insurers no longer have RTA insurer status.

So this is a claim which should be presented to the Motor Insurers Bureau as an Uninsured Driver Claim by the Yaris driver.

It sounds to me like Mr Duffy has been badly advised and his insurers haven't bathed themselves in glory either.

Posted: 02/09/2014 at 11:42

MCE have to prove that the guy intentionally set out to deceive them by not notifying them of a change.

Posted: 02/09/2014 at 11:57

I'm glad you said that, Lee Jones2, because this made no sense to me.

The test under the statute that appears to deal contribution (s.151(8) RTA 1988) refers to "causing or permitting" the use of the vehicle that led to the liability. But does a seller really "cause or permit" his buyer to use the vehicle? Once they have sold, they no longer have any say over what the buyer does with the vehicle, do they? And I don't imagine that they would be held to have "caused or permitted" for the purposes of the arguably comparable offence of causing or permitting a vehicle to be used without insurance under section 143 RTA 1988 by the mere act of selling. Otherwise, every seller would potentially commit that offence.

And if the act really does cover this situation, I would definitely have thought that it is a "loophole". Presumably, the legislation was put in place to cover the situation where a vehicle is lent to somebody, or is stolen. In that situation, it would seem quite sensible as a matter of public policy that if the vehicle crashed, it ought to be possible for third parties to claim against the policy even though technically the borrower or thief was not strictly insured to be driving, rather than being left high-and-dry with no-one to claim against. But the possibility of continuing cover under the seller's policy in the situation where ownership of the vehicle actually changes hands but the buyer doesn't bother to insure looks to me much more like an unforeseen consequence, if indeed it arises at all.

Finally, why can't the insurance policy include a provision that cover terminates upon the policyholder ceasing to own the vehicle? Would that not make this problem go away? Or is that exactly what does happen, and as you say Mr Duffy's insurance company have got it wrong?

Posted: 02/09/2014 at 12:04

Sensationalised Reporting!
'Biker forced to pay thousands'...
'A biker could be forced to pay tens of thousands'

Cut and Paste from a Local Newspaper?

There should not be a cost to cancel an Insurance policy... bad enough Mid Term Adjustments to Change bikes etc...

Posted: 02/09/2014 at 12:22

This is a refreshingly well informed debate.

Yes, it's going to be a pisser for all involved, but "caused or permitted" does seem to offer a pretty strong defence. Under the circumstances, Mr Duffy has literally nothing to lose by saying "See you in court, chaps," and having a best-of-British go.

Note that if the policy had been cancelled then the victim could have claimed under the MIB uninsured driver scheme, and we'd all have ended up paying for it anyway.

The only culprit here is the dead one, and good riddance to him.

Well, that and insurers who charge us as thanks for limiting their liability.

Posted: 02/09/2014 at 13:22

Law is crazy. The responsible is the guy that died, he was not insured, his fault.

Posted: 02/09/2014 at 13:46

Is an insurance company really going to try to generate bad press by taking recovery action on a motorcyclist recovering from Leukemia and assisting his disabled wife. BAD PRESS = Loss of more customers.

Mr Duffy - tell them to see you in court

Posted: 02/09/2014 at 13:58

Slightly unsettling to read this 5 minutes after taking a policy out with MCE...

Posted: 02/09/2014 at 14:07

I feel dreadfully sorry for the poor chap who's been lumbered here. But why would you NOT cancel your insurance straight away?

That just makes no sense to me.

I would agree with our man in Bangkok, tell them you'll see them in court.

Posted: 02/09/2014 at 14:57

Surely he can bring up the fact that his insurance was no longer valid at the time due to change of ownership?
Insurers are constantly telling us that our policies are invalid if everything isn't as you said it was when you bought the cover. So if I changed my exhaust or mirrors or address etc without notifying them that'd void my insurance so surely not owning the bike would come under the same category and the insurance should be null and void??
And also what right have they got to claim back off this poor gentleman? If his insurance is still valid then he's paid for cover and this should just be a claim as if he were riding?
This is what does my head in about these scumbag corporate insurance companies.
They make up a figure that you have to pay to be covered, force you to pay it by law then sit back and get millions a year from people for doing nothing but as soon as it's they're turn to pay out they try and worm out of it and shift blame. Drives me nuts 😤

Posted: 02/09/2014 at 15:30

In my opinion, the insurers of Mr Duffy do not have any liability to settle the claim for the actions of the motorcyclist as their own policyholder Mr Duffy ceased to have any insurable interest in the bike when he sold it.

The requirements of the European Legislation that have been mentioned in the original article are not fully met, in my opinion.

I have spoken with the MIB this morning about the circumstances of this claim and they have agreed they would most likely deal if the claim was presented to them. it seems to me that Mr Duffy's insurers are rolling over too easily and then have ambitions of trying to recover their outlay from him.

I have also managed to make contact with Mr Duffy to put him in the picture and I hope things work out for him.

Posted: 02/09/2014 at 15:32

Nice work, Lee Jones2!

Good on you for getting in touch with Mr Duffy. I too hope things work out for him.

Posted: 02/09/2014 at 15:59

Very well done Lee Jones,gives me confidence in the human race to see comments such as this

Posted: 02/09/2014 at 17:02

Hi guys..Thanks to Lee Jones who has offered to help with advice.
people have had a lot of opinions on this..some asking how can I forget to cancel my insurance. .which is my biggest crime. Well..I work a physical job full time, I care for my disabled wife when finished working, I suffer from extreme fatigue due to being in remission from Leukaemia. So please believe me when I say I genuinely forgot.
Now to clarify..I did have insurance. .which i thought was for premium. .my policy my cover. The guy who bought my bike had none or any intention of getting any. I have never broken the law..not even a speeding ticket..this guy who I had never met previously. .just out the jail and was banned for 4 years..yet..I have to pay for something I had NOTHING to do with.
Why..because according to the law its all my fault cause I never phoned.
And yes according to the Citizens Advice Bureau and Legal advice I can be forced to pay because I broke my terms and conditions by allowing the guy to ride my bike. .even though it was not my bike? This would also have been the case, According to the Law, if he had stolen it?
I have been told by Lawyers acting on behalf of MCE that they can seize any and all assets to pay for the recovery of costs including House, Car, Bike..and they can also make me bankrupt.
To say I am sick with worry is an understatement...
please share this story because trust me..nobody wants to go through this.

Posted: 02/09/2014 at 20:44

I, too, feel for Mr Duffy. Why he failed to cancel the policy is none of my business (I know several people who've done it deliberately in order to get a full years NCB, but he says he didn't and I have no reason to not believe the man), and mostly irrelevant anyway.
Like has been said; insurers look for any reason to not pay out when you need them to, even if it's a simple - read negligible - modification that they deem "sufficient" to void a policy. It's whatever suits the weasels best. Crooked, but that's the world we live in.

Unfortunately, from what I've gathered, it looks like the law is siding with the insurers on this one. If you read this, Mr Duffy, get in touch with the geezer who has a column in RiDE, he seems to offer very good legal advice for just such situations. I'm fairly sure I've read one of his relating to something very similar not too long ago.

All the best, to those concerned. This is a bugger of a situation caused by someone who, frankly, got what was coming to him. Unfortunately that doesn't go some way to help with a solution.

Posted: 02/09/2014 at 23:10

Be interesting to see if any uninsured loss recovery/legal fees lawyers would be willing to take MCE on with this?
Quite often you buy it with the insurance policy, get it bundled as part of your breakdown cover (RAC do), have it as a fringe benefit of your bank account, professional memberships whatever! Pays for tens of thousands of legal fees that you'd never be able to afford yourself. Look at the terms & see if they'll pay for a lawyer you choose - you don't always have to take whatever their preferred firm happens to be and it would be a huge benefit to get a lawyer you has experience in this area of law. Best of luck to you sir.

Posted: 02/09/2014 at 23:24

Read the T&Cs on those *carefully*. "Legal fees cover" tend to only apply to cases which (in the sole opinion of the solicitors) you have a good chance of winning, i.e. those which would be taken on under a Conditional Fee Agreement anyway.

Mr Duffy, I genuinely feel for you, and I would urge you to seek advice from solicitors who do it for a living rather than ones who get paid a flat salary from the public purse whether they win or lose.

I wouldn't pay too much attention to MCE's attack dogs. At this stage, they're just trying to put the frighteners on you to avoid a day in court.

Remember, courts are there to arbitrate civil disputes, not to punish.

Posted: 02/09/2014 at 23:39

They're having a laugh. Yeah right, pull the other one.

Posted: 03/09/2014 at 02:12

The law needs changing... I sense an e-petition coming on.

Posted: 03/09/2014 at 07:02

The intention of S151 8(b) "caused or permitted" does need clarified. I hope it doesn't come down to Mr Duffy doing so in court.

Posted: 03/09/2014 at 08:08

One of my bikes is insured with MCE. We just had and MCE track day over here in Ireland last month for them promoting themselves here. I spoke to one of the head guys in MCE here about other matters, but I wish I had heard this beforehand. You can be guaranteed if this falls in any direction other than Mr. Duffy's, that will be the last time I get insurance with MCE.

One of the questions asked on any insurance cover is 'are you the registered keeper of the vehicle': if you cease to be the registered keeper, how can you continue to be insured?

The fact that he failed to cancel it should not be an issue: if there was only one month left on the policy to gain an extra years NCB, it would be a no brainer just to let it run out. I've been riding and driving for over 25 years now, and I NEVER knew I could be held responsible for the next owners actions, if I failed to cancel the insurance policy on a vehicle I disposed of!! (And I currently have 3 motorbikes, 2 cars and 1 van ALL insured on different policies!!)

MCE - the motorbiking world is watching and listening for your next move: be very careful what you do. }0/

Posted: 03/09/2014 at 10:34

I've been told by insurance companies that you can't insure a vehicle that you don't own on a permanent policy (as apposed to the those 3-day borrowing a car type ones). So presumably it goes the other way that is you sell a vehicle you can no longer hold a policy on it. If the insurance business didn't have extraordinary costs attached to everything (just switched a policy mid term to a different bike - £50 admin fee for a bloke to click a few things on a screen!!) then maybe we would be more willing to engage with them.

Also, somewhat ironically, if Mr Duffy had been banned or disqualified the insurance wouldn't have paid out even though he's the current owner and policy holder.

Posted: 03/09/2014 at 10:43

If you don't own the bike, it's not your bike, so you have no power to give or deny permission. So you didn't permit. I hope you understand this. And you sure as hell didn't cause him to ride the bike, because he chose to.

It's been said before - no insurable interest. MCE and the lawyers are trying to fuck you over. Don't listen to them. The law is on your side.

Personally, I'd report the motherfucker threatening lawyers to the Bar, and find out who the senior partners are in the firm and send them a recorded delivery letter reporting the threats and intimidation by whatever scumbag called you. Put the shit up their firm's senior partners about losing their licence.

I'd also write to the CEO of MCE warning him you plan to make a complaint to the insurance Ombudsman in 7 days if you don't receive a retraction of the threats, an apology, and compensation for distress and suffering. File the complaint with the Ombudsman dead on the 7 days if you don't get a reply from the CEO.

Be very polite and nice in all comms. You're the good guy - show it. Mark all letters to lawyers as "without prejudice save as to costs" so they don't get to twist them against you later.

Little wonder people hate lawyers eh ?

Posted: 03/09/2014 at 12:44

>I've been told by insurance companies that you can't insure a
>vehicle that you don't own on a permanent policy

They may choose not to do so, but there's nothing (in law) stopping them.

They will also tell straight lies, that it's "against the law" to have two policies running on the same vehicle at the same time. Since they clearly don't know the law, it's a bit rich expecting us to do their job for them.

Posted: 03/09/2014 at 12:52

One last thing - no need to cancel a policy if you sell the bike but you should return the certificate of insurance with a letter saying you sold the bike. It is up to the insurer if they decide to cancel the policy or let the policy run to its end with no potential liability.

Posted: 03/09/2014 at 14:04

I always think simply, if you have insurance on a vehicle you've sold, the reason why your not cancelling is because you either

Don't want to pay a cancellation charge
You want to accrue your no claims
Forgot (forgetting or ignorance is not a valid reason not to cancel though)

Either way I see it you still have an interest in the bike, whatever route you've chosen, as especially for the first two, you benefit from not cancelling.

Now that third party who bought the bike, doesn't give a monkies if you want to do that or not, but an injured party does, so irrespective of the terms and conditions set out, you haven't informed them, so the insurance company therefore keep the policy active, they may cancel your full comp insurance, but they can't revoke your third party entitlements, hence the policy will still be active, as your the insurer, your liable for that bike.

Also remember its not just MCE, all insurers have this clause, and all are fairly clear in the t&c's, also ask before you sign up how they work out cancellations, and associated charges, if you can see yourself selling before the years up, choose a company based on these charges as well.

Posted: 03/09/2014 at 15:06

I have a question. He only sold the bike 7 days before the accident correct? How can they hold him accountable when not even 7 business days pasted between the sell and the crash? Here in America you have to account for mail travel abs the like to notify legally by mail, and up to 30 days to cancel once you sell something privately or to a dealer. Hell it takes nearly a month for the DMV to notify you that they have the plates from the vehicle you sold unless you hand it directly in at the DMV to a clerk and they punch it in!
Do you mean to tell me that Mr. Duffy would have literally signed the Bill of sale, collected the money then immediately walked in to cancel his insurance to avoid liability? What if while he was racing for the phone this guy crashed and died?!
I cry BS see you in court. If this had been several months on then Ya you were trying to get over, but a week? Come on!

Posted: 03/09/2014 at 16:19

quite simple then all bikers, DONT USE MCE for insurance.......
let them lose our business and eventually close down with bankruptcy. serves em right..... Paul Duffy, we are all behind you and hope it all gets sorted out right... eh MCE. grow some balls and fight the law on this insane ruling instead of treating your 'Paying customers'like ass holes. this country stinks if you pay your way honestly... the morons rule in britain


Posted: 03/09/2014 at 17:10

Good old MCE AGAIN
You wouldn't believe that they sponsor BSB would you? Or have any connection with the biking world? You certainly wouldn't believe it the way they treat us.
I too once had a policy with them.
After moving house I contacted them to notify of change of address however, although I had two weeks to run on the policy they still demanded twenty odd pounds for change of address. I swiftly cancelled the policy and took my business else where.
Never mind Big Ed, more like Big Rip Off!

Best of luck Mr Duffy.

Posted: 03/09/2014 at 18:16

As I understand it, MCE are a broker, not an underwriter.

Why are they getting involved?

Posted: 03/09/2014 at 19:47

Once an insurance policy has been bought and a certificate issued, a 3rd party can claim on that policy for the duration that it runs. The guy who died was disqual, but that doesn't make any difference here. There's a couple of people moaning that insurers find any way of getting out of paying - well unfortunately that might be the case for the insured rider, but when it comes t 3rd parties claiming, the story is a different one altogether. And let's not forget, the 'tens of thousands' refers to the Yaris, Yaris driver and damage to street furniture - nowhere in this article does it make reference that the dead guys family will be compensated (as they cannot claim as a 3rd party) but the Yaris driver can claim as a third party and they are entitled to the payout. ALL insurance companies can do this. End of story. I feel sorry for Mr Duffy, but at the end of the day, he is the one who should have cancelled the policy. I whole heartedly respect the fact that he has an ill wife and a terrible medical condition, but what if the shoe was on the other foot? That Mr Duffy 'forgot' to insure his new vehicle as easily as he 'forgot' to cancel the policy once the bike was sold. How would you all react then?

Posted: 03/09/2014 at 20:55

I purchased a new bike the other day. Rang up my insurer told them to cancel at 11am etc. They said you don't need to do this, something may go wrong, just ring us once it had been sold. So I collect the bike, takes an hour to get home, someone else is lined up to test ride the bike - I'm liable?! No chance.

I gave them a -specific- time and they said its not required. At no point did they say I am liable after the bike has been sold. How can they advise in that manner if it is legally wrong?

Fight it mate. MCE have spammed/phoned me enough that I wont touch them with a barge pole anyway. This is just more evidence they are c***s.

Posted: 03/09/2014 at 23:45

Right or wrong... If MCE don't ensure Mr Duffy is unaffected (and possibly even compensated for this hassle) MCE will lose more in lost policies and bikers migrating to other companies.

MCE... if you are reading this thread, get smart and make this go away. Public opinion of those that matter (your customers) consider your actions wrong and indecent. Just make it go away, then clarify the situation to all your policy holders.

Legal or not... the 'right' thing to do is clear.

Posted: 04/09/2014 at 03:52

Chaps, if THIS is the incident that makes you swear off of MCE as a broker, you've not been paying attention.

I'm still wondering why a broker is getting involved in what looks like an issue between Mr Duffy and the underwriter.

Posted: 04/09/2014 at 06:53

I still struggling to understand how they can get money of Mr Duffy in any case? If I was out on my bike this afternoon and caused a horrific crash that involved thousands of pounds worth of damage, I still wouldn't have to pay anything as my insurance covers it. That why we're insured is it not?
Even if they've cancelled his policy down to third party only it is still there to pay the third party in the event of an accident? Surely?

Posted: 04/09/2014 at 08:04

Dudeofrude, I think MCE (or whoever) may be trying to say Mr Duffy consented to him riding the bike but was not allowed to under the policy so therefore Mr Duffy is at fault and he must pay.

However, if that's true and I'm understanding it correctly, it makes no sense. He sold the bike, so no consent, it was no longer his bike. My insurance is for me. My wife can't ride my bike under the policy. So how can they then transfer Mr Duffy's policy to this other rider? Surely the insurance is for Mr Duffy only.

I'm not sure of all the ins and outs, I struggle to understand stuff like this fully. All I know is I feel a great injustice has been done to Mr Duffy already, just through the shear stress caused. I'm not bothered if he forgot to cancel his policy, for me he lost all ties to that bike the moment the V5 was signed.

Posted: 04/09/2014 at 13:02


The insurance company can and will revoke the fully comp aspect etc etc etc, but by law they can't revoke the 3rd party element, this will always stay active irrespective of whether you have sold the bike or not.

In this case by keeping the policy open, the 3rd party element is running and liable for the damages, as Mr Duffy is the owner of said policy and now in breech of that contract the insurer is well within its rights to then recover costs off of Mr Duffy.

This is not what morally right or wrong, but what's set out in law.

in this case, Mr Duffy has a legally binding and currently active 3rd party insurance on this bike when it was crashed. Therefore he's liable.

Posted: 04/09/2014 at 15:50

If and only if he "caused or permitted" Crashy McBanned to ride the bike.

On a strict interpretation of that, if selling a bike is "permitting" use of it, then we must cancel insurance before selling any vehicle. Heck, before allowing any test ride. At which point, with the bike uninsured, we must immediately SORN it.

If a court interprets it that way, then the law is an ass, and needs sorting.

Posted: 04/09/2014 at 19:58

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