{"id":5668,"date":"2020-06-11T14:57:35","date_gmt":"2020-06-11T11:57:35","guid":{"rendered":"https:\/\/www.spiliopouloslaw.com\/%cf%87%cf%89%cf%81%ce%af%cf%82-%ce%ba%ce%b1%cf%84%ce%b7%ce%b3%ce%bf%cf%81%ce%af%ce%b1\/car-accident-auxiliary-fund-unconstitutionality-of-the-e6000-limit-for-compensation-for-emotional-distress\/"},"modified":"2020-06-11T14:57:35","modified_gmt":"2020-06-11T11:57:35","slug":"car-accident-auxiliary-fund-unconstitutionality-of-the-e6000-limit-for-compensation-for-emotional-distress","status":"publish","type":"post","link":"https:\/\/www.spiliopouloslaw.com\/en\/legal-issues-for-individuals\/car-accident-auxiliary-fund-unconstitutionality-of-the-e6000-limit-for-compensation-for-emotional-distress\/","title":{"rendered":"CAR ACCIDENT \u2013 Auxiliary Fund \u2013 Unconstitutionality of the \u20ac6,000 Limit for Compensation for Emotional Distress"},"content":{"rendered":"

In<\/strong> According to Article 4 of Law 4092\/2012, the amount of \u20ac6,000 was established as the maximum limit for compensation for emotional distress of the victim\u2019s relatives, payable by the Auxiliary Fund<\/strong>, in the event of a fatal traffic accident.<\/p>\n

However, the Plenary Session of the Hellenic Supreme Court (Areios Pagos), in its Decision No. 4\/2017, ruled the above provision unconstitutional and, consequently, void, on the grounds that it:<\/p>\n

    \n
  1. a) violates Article 25(1) of the Constitution;
    \nb) conflicts with Article 1(4) of EC Directive 84\/5\/EEC; and
    \nc) contravenes Article 1 of the First Additional Protocol to the European Convention on Human Rights.<\/li>\n<\/ol>\n

    Accordingly, plaintiffs claiming compensation for emotional distress due to the death of a loved one and relative are not subject to quantitative limits<\/strong> in cases where the Auxiliary Fund is liable.<\/p>\n

    Within the framework of Greek law, this matter had already been addressed in Articles 16 et seq. of Law 489\/1976, codified by Presidential Decree 237\/1986, which established a private law legal entity named \u201cAuxiliary Fund for Motor Vehicle Accident Liability Insurance\u201d<\/strong>, abbreviated AUXILIARY FUND<\/strong>, governed by the provisions of the aforementioned law.<\/p>\n

    Membership in the Auxiliary Fund is mandatory for insurance companies providing liability insurance for motor vehicle accidents, as well as for public law entities or utility organizations whose vehicles are exempt from compulsory insurance (Article 18, Law 489\/1976). To fulfill its purpose, the Fund is statutorily required to levy contributions, the maximum of which is determined by the relevant decision of the Minister of Development, calculated as a percentage of net premiums (maximum 5%) from the motor vehicle liability insurance branch, borne 70% by insurers and 30% by insured parties (Article 20 \u00a71, Law 489\/1976).<\/p>\n

    From the legislation governing it, its method of operation, and the purposes it serves, it is evident that, despite its status as a private law entity, the Auxiliary Fund performs a social function<\/strong>.<\/p>\n

    Under Articles 5, 6 \u00a7\u00a7 1, 2, 5, 6, and 10 \u00a71 of Presidential Decree 237\/1986, compulsory motor vehicle liability insurance<\/strong> was established, which covers civil liability toward third parties arising from death, bodily injury, or property damage. This coverage explicitly includes claims for emotional distress or moral damage<\/strong>, and the insured amount must be at least equal to the minimum amounts determined at any given time by the competent authority for each type of risk subject to compulsory insurance.<\/p>\n

    Furthermore, pursuant to Article 19 \u00a71 of the same Presidential Decree, the Auxiliary Fund<\/strong> is obliged to pay compensation to persons harmed, as provided in paragraph 2 of that Article, for death, bodily injuries, or property damage resulting from motor vehicle accidents, in cases where the damage is caused by an uninsured vehicle<\/strong>, a vehicle of unknown identity<\/strong>, or a vehicle insured with a company that has gone bankrupt<\/strong> or whose operating license has been revoked<\/strong>. According to paragraph 2 of the same Article, as it stood before being amended by Law 4092\/2012, the compensation could not exceed the minimum insurance amounts<\/strong> in force at the time of the accident, as established under Article 6 \u00a75.<\/p>\n

    Moreover, with Article 4 of Law 4092\/2012, which according to its Article 7 has been in force since its publication in the Government Gazette (FEK 220\/A, 78.11.2012), restrictions were introduced on the compensation payable by the Auxiliary Fund<\/strong> in cases of insurer bankruptcy or revocation of its license, as well as restrictions on the amount of compensation for emotional distress<\/strong>.<\/p>\n

    Specifically, under subsection (c) of the above Article, paragraph 2 of Article 19 of Presidential Decree 237\/1986 was replaced, and it now provides, inter alia:<\/p>\n

      \n
    1. a) Compensation paid by the Auxiliary Fund for emotional distress cannot exceed six thousand (\u20ac6,000) euros per beneficiary<\/strong>; and<\/li>\n
    2. b) In cases of insurer bankruptcy, unsuccessful execution against the insurer, or revocation of the operating license of an insurance company, compensation is not paid in full<\/strong>, but according to the percentages detailed in the provision, ranging from 70% to 90%, and cannot exceed one hundred thousand (\u20ac100,000) euros in total<\/strong>.<\/li>\n<\/ol>\n

      The same provision further specifies that this regulation \u201capplies also to claims already accrued against the Auxiliary Fund, without affecting claims that have been awarded by a final judicial decision\u201d<\/strong>, and that \u201cinterest payable by the Auxiliary Fund in the cases of the preceding paragraph of this Article shall, in any event, be calculated at a rate of six percent (6%) per annum.\u201d<\/strong><\/p>\n

      It should be noted that, under the aforementioned provision of Article 1(4) of the Second Directive 84\/5\/EEC<\/strong>, according to which:<\/p>\n

      “Each Member State shall establish or approve a body whose mission is to compensate, at least within the limits of the insurance obligation, for material damage or bodily injury caused by vehicles of unknown identity or for which the insurance obligation provided in paragraph 1 has not been fulfilled,”<\/em><\/p>\n

      compensation for emotional distress is also covered<\/strong> (Supreme Court Plenary Session, Decision 9\/1993; CJEU, Case C-277\/12, 24-10-2013, \u2026 v \u2026).<\/p>\n

      Furthermore, Article 9(1) of the Codifying Directive 2009\/103\/EC<\/strong> precisely defines the minimum insurance coverage amounts<\/strong>, which must be observed in every case (CJEU, Case C-348\/98, 14-11-2000).<\/p>\n

      Subsequently, according to Article 25(1) of the Greek Constitution<\/strong>, human rights, both as an individual and as a member of the social community, are guaranteed by the State, and any restrictions on these rights imposed under the Constitution must be provided either directly by the Constitution or by law<\/strong>, where such law is authorized, and must respect the principle of proportionality<\/strong>.<\/p>\n

      Finally, under Article 1 of the First Protocol to the European Convention on Human Rights<\/strong>, ratified by Legislative Decree 53\/1974 and having higher formal authority than ordinary laws<\/strong>, it is stipulated that:<\/p>\n

      “Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his property except in the public interest and subject to the conditions provided for by law and by the general principles of international law.”<\/em><\/p>\n

      The above provisions do not affect the right of any State to enact laws it deems necessary to regulate the use of property in accordance with the public interest or to ensure the collection of taxes or other contributions or penalties.<\/strong><\/p>\n

      Under these circumstances, the aforementioned provisions of Law 4092\/2012<\/strong> are void<\/strong> for the following reasons:<\/p>\n

        \n
      1. The establishment of \u20ac6,000 as the maximum limit<\/strong> for compensation for emotional distress per beneficiary directly conflicts<\/strong> with Article 1(4) of the Second Directive 84\/5\/EEC, according to which:<\/li>\n<\/ol>\n

        “Each Member State shall establish or approve a body whose mission is to compensate, at least within the limits of the insurance obligation, for material damage or bodily injury caused by vehicles of unknown identity or for which the insurance obligation provided in paragraph 1 has not been fulfilled.”<\/em><\/p>\n

        As previously noted, this provision explicitly covers compensation for emotional distress<\/strong>.<\/p>\n

          \n
        1. Furthermore, the imposed maximum limit of \u20ac6,000 violates the principle of strict proportionality<\/strong> (Article 25 \u00a71, subparagraph d of the Constitution), because the legislator\u2019s intervention is neither suitable nor necessary<\/strong> to achieve the intended purpose, i.e., ensuring the financial viability of the Auxiliary Fund. This objective could have been achieved in a less restrictive manner<\/strong>, either by providing an extraordinary state subsidy<\/strong> or by requiring the Fund to stabilize its finances<\/strong> through increased revenues and reduced operating expenses.<\/li>\n
        2. On the other hand, the application of the above provision, which limits the liability of the Auxiliary Fund even for claims already accrued<\/strong>, is void<\/strong>, because it contravenes Article 1 of the First Protocol to the European Convention on Human Rights<\/strong>, ratified (together with the Convention) by Legislative Decree 53\/1974, and which, according to Article 28 \u00a71 of the Constitution, has superior authority over ordinary laws<\/strong>.<\/li>\n<\/ol>\n

          This provision guarantees respect for the property of individuals<\/strong>, which may only be deprived for reasons of public interest<\/strong>. The concept of property includes not only real rights, but also all \u201cproperty-type\u201d rights<\/strong> and acquired economic interests<\/strong>. This includes obligatory (contractual or pecuniary) rights<\/strong>, specifically claims either recognized by judicial or arbitration decisions, or already accrued under national law<\/strong>, provided there exists a legitimate expectation<\/strong>, under the law in force at the time of filing the claim, that they can be judicially enforced (Supreme Court Plenary Sessions 6\/2007, 40\/1998).<\/p>\n

          Thus, the above provision of Law 4092\/2012<\/strong>, by drastically limiting the amount of compensation for emotional distress, effectively abolishes this civil claim<\/strong> of the beneficiaries, which arises from the death of a relative in a traffic accident.<\/p>\n

          Consequently, it is incompatible with Article 1 of the First Protocol to the European Convention on Human Rights<\/strong>, <\/strong>as it tends to result in the unjustified deprivation of property<\/strong> of the aforementioned persons, without any justification in the public interest. Such justification cannot be satisfied merely by the financial interest of the Auxiliary Fund<\/strong>.<\/strong><\/p>\n

          Furthermore, under Article 4 \u00a7\u00a71 and 2 of the Greek Constitution<\/strong>, all Greeks are equal before the law. Greek men and women enjoy equal rights. This provision establishes not only the equality of citizens before the law<\/strong>, but also the equality of the law before them<\/strong>, <\/strong>in the sense that the legislator, when regulating essentially identical matters, relationships, situations, categories, or persons, cannot legislate differently by introducing exceptions or making distinctions<\/strong>, <\/strong>unless the different regulation is not arbitrary but imposed for reasons of general social or public interest<\/strong>, and the relevance of special circumstances or public interest is subject to judicial review<\/strong> (<\/strong>Supreme Court Plenary Sessions 3\/2006, 38\/2005, 30\/2005, 23\/2004, 11\/2008).<\/p>\n

          Finally, according to Article 14 of the International Covenant on Civil and Political Rights<\/strong>,<\/strong><\/p>\n

          “All persons shall be equal before the courts. Everyone shall be entitled to a fair and public hearing by a competent, independent, and impartial tribunal \u2026 in the determination of any civil rights and obligations.”<\/strong><\/em><\/p>\n

          The Covenant has been incorporated into Greek law by Law 2462\/1997<\/strong>. <\/strong>Under these provisions, the principle of equality of litigants<\/strong>, <\/strong>which constitutes a specific manifestation of the broader principle of equality, <\/strong>requires equal treatment of all parties by the laws governing judicial protection<\/strong>.<\/strong><\/p>\n

          Therefore, <\/strong>legal provisions that grant one party favorable treatment regarding this right, resulting in that party being placed in a more advantageous position than their opponent, are void<\/strong> (Supreme Court Plenary Sessions 12\/2013, 4\/2012).<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

          In According to Article 4 of Law 4092\/2012, the amount of \u20ac6,000 was established as the maximum limit for compensation for emotional distress of the victim\u2019s relatives, payable by the Auxiliary Fund, in the event of a fatal traffic accident.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"pgc_meta":"","footnotes":""},"categories":[526],"tags":[],"class_list":["post-5668","post","type-post","status-publish","format-standard","hentry","category-legal-issues-for-individuals"],"rttpg_featured_image_url":null,"rttpg_author":{"display_name":"spiliopouloslaw","author_link":"https:\/\/www.spiliopouloslaw.com\/en\/author\/root2christos\/"},"rttpg_comment":0,"rttpg_category":"Legal Issues for Individuals<\/a>","rttpg_excerpt":"In According to Article 4 of Law 4092\/2012, the amount of \u20ac6,000 was established as the maximum limit for compensation for emotional distress of the victim\u2019s relatives, payable by the Auxiliary Fund, in the event of a fatal traffic accident.","_links":{"self":[{"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/posts\/5668","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/comments?post=5668"}],"version-history":[{"count":0,"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/posts\/5668\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/media?parent=5668"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/categories?post=5668"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.spiliopouloslaw.com\/en\/wp-json\/wp\/v2\/tags?post=5668"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}