The Auto Cycle Union has admitted liability over the TT incident that left red-flagged racer Steve Mercer with life-changing injuries.

But the scale of his personal injury compensation has still to be agreed - and the case could yet go to court.

Details emerged at a high court hearing in which a lawyer for the ACU sought an interim ’declaration of jurisdiction’ - in short, a ruling on whether the case should be heard here as the ACU wants or in England, as Mr Mercer believes it should.

The court heard that the TT rider has not issued any proceedings as yet.

But Vicki Unsworth, representing the ACU, said her client had sought the interim declaration as a ’pre-emptive application’ given the threat that Mr Mercer would issue proceedings in the high court of England and Wales.

Such a move, if granted, would be a first for the island.

Steve Mercer was critically injured during his 10th TT when he was among a group of red-flagged TT riders who were allowed to travel back to the Grandstand the ’wrong way’ round the course.

At Ballacrye, near Ballaugh, his machine collided head-on with a course car, which was travelling at high speed on its way to the accident which claimed the life of Manx TT star Dan Kneen.

Deemster Alan Gough asked if liability had been admitted, and suggested this would be difficult ’if you don’t know exactly what the claim is’.

Mrs Unsworth replied: ’In respect of this matter, liability has been admitted. It was admitted by the claims handler in the UK.

’However, causation and also quantum remain an issue.’

Mrs Unsworth said a pre-proceeding declaration could be granted where matters were urgent or otherwise in the interests of justice.

No claim form has been issued, she confirmed.

But she said the threat of proceedings being issued in an alternative jurisdiction had made the application necessary.

Mrs Unsworth said contact had been made with clerk of the TT course Gary Thompson by Mr Mercer’s lawyer, Mr Collins of Penningtons Manches, just 13 days after the May 30 incident last year.

There followed on August 1 a ’letter before action’ to the ACU’s claims handlers DWF detailing allegations of potential negligence.

An email from Mr Collins to DWF in October was clear from its content that Mr Mercer was ’seeking to have the matter issued with the English high court’, Mrs Unsworth said.

She said it was appropriate to seek the declaration given that the TT is ’uniquely Manx’ and the incident took place on Manx roads.

The ACU’s lawyer said that riders entering the TT sign up to a commercial contract with regulations stipulating that any legal proceedings arising will be dealt with under Manx law and in the Manx courts.

She said Mr Mercer would have been sent the regulations three times and this jurisdictional clause has never changed. Proceedings were ’beefed up’ this year, she said, as ’so many riders are not reading the regulations’.

’There’s no overwhelming reason put forward by Mr Mercer that would mitigate in favour of the court ignoring the exclusive jurisdiction in this contract,’ she said.

Mrs Unsworth said the riders knew the risks, given the three competitors died in 2017 and a total of 253 have lost their lives since 1911.

Mr Mercer, she said, had not been forced to enter into the contract.

She denied that any English solicitor had been instructed in this matter and DWF Claims and DWF Law are entirely separate entities, wih DWF being a claims handler operating under the DWF brand.

There would a greater exposure to cost risk if the case was heard in England where damages awarded could be substantially higher, the court was told.

’Justice can clearly be done in the English court but at a much greater cost and much greater risk to my client,’ Mrs Unsworth concluded.

Mr Mercer would not be eligible for legal aid if the case was heard here, it was confirmed.

His advocate Damian Molyneux said the application for the interim declaration had been made ’improperly’. There was nothing in the pre-action correspondence to suggest that proceedings would be issued imminently, he said.

The ACU was seeking an application, he said, before acknowledgement of service or a defence has been filed.

He said all riders are acutely aware of the risks of competing in the TT, including the possibility of death.

But he pointed out: ’He wasn’t even racing. He had been red-flagged.

’He was coming back with the instruction being given to him from marshals by race organisers.

’Being hit by a course car when the race was red-flagged is not something foreseeable.’

Mr Molyneux added: ’What this boils down to is a very tragic incident involving a TT competitor who was following instructions that came from race control.’

He said he didn’t believe the jurisdiction clause in the contract was valid.

He pointed out that while the incident happened on Manx roads, ACU Events was incorporated in England, Mr Mercer lives in England and is being treated in England.

Most witnesses would not be from the Isle of Man.

He said Mr Mercer has had an interim payment and his understanding was that those payments were coming from the English bank account of the ACU.

Mr Molyneux said medical reports showed his client had 14 different serious injuries, including to his larynx, pelvis, spine, ribs and also a collapsed lung.

He said his client would like to attend the proceedings but that unfortunately he can ’barely function on a daily basis, let alone travel’.

Mr Molyneux suggested that there would be no fewer than 10 experts giving evidence if the case went to court .

He said the ACU was concerned at how much the case was going to cost. ’If the case was heard in England it would cost the ACU more,’ he said.

Mr Molyneux suggested there should be some reporting restrictions given that the incident had regularly made headlines in the Manx press without the media ’knowing the full facts’ and Mr Mercer did not want his ’laundry aired in public’.

But the Deemster reminded the advocate about the principle of open justice.

Deemster Gough said he would be reserving judgment on the ACU’s application.