The claimant, who sustained injury when the defendant’s vehicle skidded on black ice, appealed the decision to dismiss his claim.      

The Court of Appeal found that the trial judge was entitled to dismiss his claim without criticising the driver where the cause of the accident was judged to be unforeseen black ice, rather than driver error.  The Court of first instance found that the defendant was not driving too fast, he had no reason to think the road was dangerous and the danger was neither visible nor reasonably foreseeable.  They added that skidding was not, in itself, enough to establish negligence against the driver.   

Comment – Insurers can take comfort in knowing that they can successfully challenge the doctrine of Res Ipsa Loquitur and the presumption that a driver who loses control of their vehicle is negligent.  The Insurer must demonstrate that the driver had taken all reasonable care, notwithstanding the fact that the danger was not visible, and that there was good reason for the loss of control which was not attributable to the driver.  An unexplained loss of control would not rebut the presumption.  It will require a case-by-case analysis but if an Insurer can satisfy the test, then no liability will attach to the driver.  Lord Justice Toulson opined that to say a careful driver might be capable of driving on a dangerous road without incident is one thing; to say a person who suffered an accident because of dangerous road, and was, therefore, negligent, is quite another.  

End

The 16-year-old claimant attended the defendant’s daughter’s end-of-GCSEs party and suffered a spinal fracture and incomplete tetraplegia following an accident diving into a paddling pool.     

The Court found that the defendant had provided a modest amount of alcohol and the guests had brought their own.  Neither the claimant nor anyone else was visibly affected by alcohol.  No one had dived into the pool before the claimant.  When the guests’ behaviour had begun to get a bit boisterous, food was served.   

The claimant had intended to do a “belly flop” but misjudged the angle.  He did not slip on wet grass.   

The claimant argued that by not intervening earlier in the boisterous play, the defendant had created a situation with an obvious risk of serious injury.    

The judge held it was not reasonably foreseeable that someone would try to dive or belly flop into the pool.  The defendant did not have a duty to tell the guests not to run and jump into the pool – even if they would have obeyed the instruction.    

Allowing the use of the paddling pool of itself did not create a foreseeable risk of injury or justify a formal risk assessment.  The defendant was found not to be in breach of his duty of care and the claim was dismissed.   

Had the defendant been found liable, the claimant’s contributory negligence would have been assessed at two-thirds.   

Comment – The case provides guidance on the duty of care owed by the parents of teenage children hosting a party at home.  Leading counsel for both parties and the judge agreed it amounted to: “Reasonably… keep an eye on what was going on; to keep abreast of what people were doing: if matters were getting out of hand, to intervene in a reasonable manner, though not so as to spoil the party”.   

End

The first defendant and the second defendant appealed against decisions finding them 50% and 20% liable for a road traffic accident, respectively.    

The Court heard that the claimant was riding pillion on a motorcycle that was being driven by the first defendant.    

As the first defendant rounded a bend in the road at a speed of approximately 55mph to 60mph, he saw the third defendant’s vehicle parked on a bend on the opposite side of the carriageway, where overtaking was forbidden.    

The first defendant was also confronted with the second defendant who was overtaking the third defendant’s vehicle on the wrong side of the road at a speed of less than 10mph.    

The first defendant took action to avoid a collision and, in so doing, seriously injured the claimant.    

The trial judge found that the first defendant rode with excessive speed and that the second defendant had overtaken the third defendant in a too cautious manner.  The third defendant was found to be 30% liable for parking in a dangerous place.    

On appeal, the finding of negligence was upheld.  However, the appeal on apportionment was allowed on the basis that the second defendant was equally as culpable as the first defendant having not completed her manoeuvre quickly.  Instead, she unreasonably delayed in returning to her lane.    

Liability was re-apportioned between the first defendant and the second defendant at 35% each.    

Comment – This case is a reminder that to travel too slowly can be equally as dangerous as travelling too fast.  The road layout must always be taken into account when considering liability.  Insurers must therefore be mindful that cautious driving is not equal to safe driving.    

End

The claimant was the proprietor (sole director and shareholder) of Motornet, a small workshop dealing in vehicle servicing and MOT inspection.  He was injured whilst at work because of a faulty hydraulic ramp.   

The ramp was faulty because it had not been properly maintained, which meant Motornet was in breach of its absolute duty to provide safe equipment under the Provision of Use of Work Equipment Regulations 1998.    

The claimant (director) sued Motornet, seeking damages for breach of statutory duty, even though he was himself entirely responsible for that breach through having (as sole director) failed to ensure the ramp was safe.   

At first instance, the judge dismissed the claim, holding that the claimant had been 100% contributorily negligent.  The Court of Appeal also dismissed the claim but for different reasons, namely that the breach of statutory duty was brought about by the claimant’s own breach of his duty as director under the Companies Act 2006; and, accordingly the claim fell foul of the common law principle that a person cannot derive any advantage from his own wrongdoing.    

Comment  - Attempts by sole directors to claim from their company’s liability policy in this fashion are surprisingly common and hitherto there has been no conclusive authority with which to rebut them.  This decision, therefore, comes as a welcome application of common sense.  As the Court observed: “To say you are liable to me for my own wrongdoing is neither good morals nor good law”.    

End

The claimant had worked for the defendant as a scaffolder for many years and was working with his nephew who was a self-employed scaffolder’s labourer.  

A property at which they were erecting scaffolding had no rear access, so the scaffolding had to be taken through the house, although they could not do the same with the ladders.  The claimant was on top of the scaffold, but had no safe means of descending and asked his nephew to telephone the defendant for instructions.  The claimant fell, although there were no witnesses and the claimant was unable to give evidence at trial.  

The claimant alleged a failure to undertake a suitable and sufficient risk assessment under the Management of Health & Safety at Work Regulations 1999 and for failures under the Work at Height Regulations 2005, including planning and supervising the work.  

The claimant had received no formal training since the 1990s and argued the defendant had failed to ensure he remained competent to organise, plan and erect scaffolding.  The company argued that the claimant was an experienced scaffolder, had been appropriately trained and that there was a generic risk assessment for the work to be undertaken.  

The judge found that it was unacceptable to have relied on the claimant’s own ability to assess the job for himself without the need for a risk assessment or method statement.  If he had been properly trained and the task adequately assessed, the claimant would have incorporated the use of internal ladders available to him.   

Comment – This case reinforces the principle that a failure to demonstrate an up-to-date training record, risk assessment and safe system of working, dictated that the company was liable, in part, for the claimant’s own actions.  However, the judge found that the decision to climb down the outside of the scaffold had been taken deliberately by the claimant and he had erected a scaffold without any ready means of safe access.  The claimant subsequently bore the greater responsibility with his own contributory negligence assessed at 60%.   

End

In March 2003, during the course of treatment received by the claimant Richard Meiklejohn, a sample of the claimant’s blood was sent to Professor Dokal for research purposes.  It was not until November 2005 that the sample was analysed and it was found that there was a gene mutation that led to a diagnosis of Dyskeratosis Congenita, a very rare genetic disorder.

In May 2003, the claimant had been diagnosed with acquired aplastic anaemia by Professor Marsh.  The standard treatment the claimant received carried a risk of the rare side effect of avascular necrosis, but the claimant was not informed of this and went on to develop AVN in both hips.

The claimant alleged Marsh carried out an inadequate clinical examination and there were sufficient clinical features to raise strong suspicion the claimant had constitutional DC.  It was also argued that: Marsh was wrong to diagnose acquired AA and start therapy before excluding the possibility of DC; she should have warned of the risks of side effects and offered alternative treatment; and she unlawfully took a sample of the claimant’s blood without consent and, having done, should have obtained the results earlier when the likelihood was that it would have been treated appropriately and so the claimant would not have developed AVN.

However, the judge found that the clinical examination and diagnosis was sufficient.  There was no duty to warn the claimant about a risk which had never previously been known in the defendant’s clinical experience or that of their expert.  The alternative treatment carried its own risks.  The defendant contended that even if she had returned earlier results to the blood sample, she would have still have recommended the same treatment.

Comment – This case concerned the law applying the standard of care.  It is an important case for Insurers, as the Court found that although the chosen expert was involved in the treatment, and therefore there was a possible conflict of interest, he was deemed to be independent and appropriate.  There was a very limited pool of experts with appropriate knowledge of the illness and the expert in this case was obliged to fulfil his overriding duty to the Court.

End

[2012] EWCA Civ 1267

CA (Civ Div) (Ward LJ, McFarlane LJ, Dame Janet Smith) 11 October 2012

INSURANCE - ROAD TRAFFIC

DAMAGE TO PROPERTY : EXCLUSION OF LIABILITY : MOTOR INSURANCE : MOTOR INSURERS’ BUREAU : PROPERTY INSURANCE : ROAD TRAFFIC ACCIDENTS : SUBROGATION : PROPERTY DAMAGE CAUSED DELIBERATELY BY DRIVER : MOTOR INSURANCE POLICY EXCLUDING DAMAGE DELIBERATELY CAUSED : WHETHER MOTOR INSURER OBLIGED TO SATISFY JUDGMENT OBTAINED BY PROPERTY INSURER AGAINST DRIVER : ROAD TRAFFIC ACT 1988 s.145, s.151, s.151(2)(a), s.145(4)(b), s.145(4)(d)

A property Insurer was not entitled to recover from a motor Insurer in respect of property damage deliberately caused by a driver where the motor insurance expressly excluded damage caused by the driver’s deliberate act. The policy exclusion meant that the judgment obtained by the property Insurer against the driver did not relate to a “liability covered by the terms of the policy” within the Road Traffic Act 1988 s.151(2)(a).

The appellant Motor Insurer (E) appealed against a decision ([2011] EWHC 1657 (QB), [2011] 2 All E.R. (Comm) 1113) that the Insurer of the respondent property owner (B) was entitled to recover from E in respect of property damage deliberately caused by a driver (W).
W deliberately crashed his car into a shop owned by B causing substantial damage. B’s property Insurer brought a subrogated claim against W and obtained judgment against him. W had motor insurance but his policy issued by E excluded damage caused by his deliberate act. B’s Insurer contended that on the proper construction of the policy, the Road Traffic Act 1988 s.145 and s.151, and the European Directives on motor insurance, E had to cover damage to property whether deliberately caused or not. E contended that because the policy expressly excluded damage deliberately caused it was not obliged to indemnify the property owner on the correct interpretation of s.151. The judge decided as a preliminary issue that B’s Insurer was entitled to recover from E.
E submitted that because the policy excluded liability for deliberate acts, the judgment did not relate to a liability “covered by the terms of the policy” within s.151(2)(a) so as to impose a duty on it to satisfy the judgment.

HELD: Under the 1988 Act not all damage to property had to be covered. Under s.145(4)(b) the policy was not required to provide for insurance of more than 1 million in respect of damage to property arising out of any one accident, and under s.145(4)(d) it was not required to cover liability in respect of damage to goods carried for hire or reward in the vehicle. The list was not exclusive and other forms of liability could be excluded by agreement between Insurer and Insured. There were time-honoured limitations on use for social, domestic or pleasure purposes and the validity of such limitations had never been doubted. If there was such a limitation then use for hire or business would be uninsured.

Liability for the damage caused by W to the shop was not “covered by the terms of the policy” within s.151(2)(a) because the terms of the policy expressly excluded damage caused by the deliberate act of the driver. It could not be right that the only requirement of s.151 was that the liability was of the kind which ought to have been covered by a policy complying with s.145 even if the actual policy did not cover that particular liability. The scheme of the Act coupled with the Motor Insurers’ Bureau arrangements satisfied the aim and spirit of the European motor insurance directives to enable third party victims of accidents caused by vehicles to be compensated for all damage to property and personal injuries sustained by them, Criminal Proceedings against Bernaldez (C-129/94) [1996] All E.R. (EC) 741 considered. There was no justification for reading Bernaldez in such a way as to preclude E relying on the exclusion clause.

The exclusion of liability meant that W was uninsured, but the directives allowed for such uninsured losses to be paid under the Motor Insurers’ Bureau scheme even if that was a measure of last resort. Section 151 gave no right of recovery against E with the result that ordinarily a claim would be made against the Motor Insurers’ Bureau. However, the Motor Insurers’ Bureau scheme did not extended to compensating those who suffered property damage where such damage was insured by the victim’s own Insurer which brought a subrogated claim for recovery (see paras 34, 40, 42, 46-48, 63-64, 66 of judgment).
Appeal allowed

END

1) BRIT INNS LTD (In Liquidation) (2) VINCENT BARBER (3) LINDA LAWLESS (Claimants) v BDW TRADING LTD (Defendant) & J REDDINGTON LTD (Third Party/Part 20 Defendant) : (1) VINCENT BARBER (2) LINDA LAWLESS (3) STEPHEN KATZ (LIQUIDATOR OF BRIT INNS LTD) v (1) BDW TRADING LTD (2) J REDDINGTON LTD (2012)

[2012] EWHC 2143 (TCC)

QBD (TCC) (Coulson J) 31 JULY 2012

DAMAGES - INSURANCE

FLOODS : INSURANCE CLAIMS : LOSS ADJUSTMENT : LOSS OF PROFITS : MEASURE OF DAMAGES : REASONABLENESS : REINSTATEMENT : SUBROGATION : RESTAURANT BUSINESS MAKING INSURANCE CLAIM FOLLOWING DAMAGE CAUSED BY NEGLIGENCE OF THIRD PARTY : INSURER SEEKING TO RECOVER SUMS PAID ON CLAIM : REASONABLENESS OF SUMS CLAIMED

In a subrogated claim by which the Insurer of a restaurant business sought to recover monies paid out on a claim for the cost of remedial works necessitated by the negligence of a construction company, the court awarded damages in a sum significantly less than that claimed. The Insured’s claim had been grossly exaggerated and the Insurer had not properly investigated it.

The claimants (B, V and L) claimed damages for losses arising from flooding of their restaurant caused by the admitted negligence of the defendant construction company (X).
B was a company in liquidation; V and L were its directors. B had engaged X to demolish a public house that it had operated and to construct a new building in its place, comprising a ground-floor bar and a basement restaurant. When X completed the shell of the basement and ground floor, B took charge of the fitting-out works, which were largely completed by December 10, 2006. There was some dispute about the cost of those works, but the available and possibly incomplete documentation put it at around 279,229. On December 11, the basement was flooded as a result of the negligence of Thames Water, which paid B just over 255,000 in compensation. Some remedial work was carried out, but in January 2007 the basement flooded again. On that occasion, the flooding was the result of X’s negligence. X did not dispute liability. B re-fitted the basement and the restaurant opened for business in mid-October 2007. Until December the restaurant was quite successful, but in the first half of 2008 its takings began to decline. There were problems with foul smells which, in mid-2008, were traced to a soil vent pipe which one of X’s contractors had punctured. In June 2008, B closed the restaurant. It made an insuranceclaim of just under 400,000 for the material damage caused by the flood, and also claimed loss of profits. Its Insurers paid 355,070 for the material damage, plus 240,905 for loss of profits. The central claim before the court was a subrogated claim, by which B’s Insurers sought to recover from X the monies it had paid to B.

The issue was whether the sums claimed were reasonable.

HELD: (1) A claimant in B’s position was entitled to recover the reasonable costs of reinstatement. Where the reinstatement works were complete by the time of trial, the actual cost of the works would almost always be the starting point in assessing what was reasonable. If a sum had been assessed as reasonable by an experienced loss adjuster, it would ordinarily take good evidence to demonstrate that it was not in fact reasonable. However, everything turned on the facts of the case.

In respect of the second fit-out, B’s claim was grossly exaggerated and had not been properly investigated by the Insurer. There was no schedule of works and no record of the work carried out, and it was therefore impossible to say with certainty what had, and had not, been done. The invoices were inadequate, unreliable and impossible to analyse retrospectively: they failed to identify what work was the subject of the claim, did not identify the instructions pursuant to which the work had been carried out, and contained nothing to indicate to the way in which the sums claimed might be assessed. Moreover, the experts agreed that many of the invoices did not relate to remedial works properly undertaken. There was no evidence as to how payment for the work had been assessed, there had been no checks that work invoiced for had actually been done, and there was no proper record of invoices having been paid. The experts agreed that the 400,000 claimed by B was at least 100,000 too much, but alarm bells should have been ringing for the Insurer much sooner. The cost of the original fit-out works for two floors was, on the balance of probabilities, less than 300,000. On that basis alone, the 400,000 claimed for the basement should have looked much too high.

There was no evidence to justify the sizeable nature of the discrepancies, the loss adjuster had not consulted a quantity surveyor, and there had been no forensic investigation of the claim. Both the claim and its adjustment were fundamentally flawed. The proper quantum of the subrogated claims for material damage was 136,688.89 (see paras 13, 23, 29-32, 45, 48-56, 58, 61-62, 65, 71-72, 76-77, 92, 188-189, 296 of judgment). (2) B’s claim for 240,905 loss of profits assumed that the restaurant would have been profitable immediately. Since the restaurant was a new business, that assumption was inappropriate. The claim appeared to calculate a loss of profit caused by both the first and the second floods, with an arbitrary reduction for the first flood. That approach was not legitimate, giving rise to the risk that X was being made liable for matters that were not its responsibility. Finally, the figures underpinning the claim did not come from the restaurant’s own trading figures, but were instead extrapolated from those of a comparator. The actual figures were not even used for the purposes of comparison, which was surprising and erroneous.

The experts agreed that where actual profit and loss figures were available, they ought to form the starting point for any calculation for loss of profit, unless there were good reasons for disregarding them. None of the reasons given by B justified disregarding its actual profits. On B’s actual profit and loss figures, the appropriate quantum of the loss of profits claim was 20,779 (paras 190-191, 194-195, 200-203, 206, 229 297).

Damages assessed

END

QBD(John Leighton Williams QC) 27 JULY 2012

LANDLORD AND TENANT - TORTS - PERSONAL INJURY - REAL PROPERTY

BREACH OF COVENANT : BREACH OF DUTY OF CARE : DEFECTIVE PREMISES : DUTY OF CARE : LANDLORDS’ DUTIES : OCCUPIERS’ LIABILITY : REPAIR COVENANTS : STAIRS : TRIPPING AND SLIPPING : TENANT SLIPPING ON PAINTED OUTDOOR STEPS : WHETHER COMMON LAW DUTY OF CARE BREACHED : OCCUPIERS’ LIABILITY ACT 1957 s.2 : DEFECTIVE PREMISES ACT 1972 s.4

A landlord owed no duty of care under the Defective Premises Act 1972 s.4 or the Occupiers’ Liability Act 1957 s.2 to her tenant who had slipped on painted steps on her property and sustained injuries. The tenant was owed a common law duty of care, but that duty of care had not been breached as, although the presence of paint on the steps significantly increased their slipperiness, it had not been unreasonable for the landlord to paint them using outdoor paint.

The claimant tenant (D) claimed damages for personal injury arising from a fall she suffered when ascending the steps of the property she rented from the defendant landlord (H).
The front door to H’s property was accessed via a concrete path leading to three steps. H had the steps painted with paint suitable for outdoor use to improve their appearance. To the left of the path was an area that had steps down to basement level. That area was separated from the concrete path by a very low wall that continued alongside the three steps to the front of the house. The wall had been like that when H bought the property. It offered limited protection against a fall from the steps down to the basement. D and her fiance were carrying a box up the steps to the property in the rain when D slipped on the middle step and fell over the wall down to basement level. She sustained serious back injuries. D asserted that the steps were unduly slippery because they had been painted and because of the rain. Expert evidence confirmed that painting the steps increased the risk of slipping. The issues for consideration were whether H was liable for (1) breach of the Occupiers’ Liability Act 1957 s.2; (2) breach of covenant and/or breach of the Defective Premises Act 1972 s.4; (3) breach of duty at common law.

HELD: (1) Section 2 of the 1957 Act applied generally whereas s.4 defined a landlord’s duty. It cannot have been Parliament’s intention for both s.2 and s.4 to define a landlord’s duty. Section 4 of the 1957 Act was replaced by the 1972 Act and therefore s.4 of the 1972 Act defined the extent of a landlord’s duty,Murphy v Brentwood DC [1991] 1 A.C. 398applied (see paras 74-77 of judgment). (2) The paint was additional to the stone; it did not replace it. The stone did not require repair, neither did the paint: what was required was removal of the paint. On the facts, the presence of the paint on the steps did not cause the steps not to be in good repair. Therefore, the presence of the paint did not give rise to a breach of s.4 of the 1972 Act or the tenancy agreement requiring H to maintain the structure and exterior in good repair (paras 87-88). (3) H had no duty to guard against the unguarded drop to basement level, Cavalier v Pope [1906] AC 428 applied. In relation to the steps, there was no reason why H should not have a duty to take reasonable care to ensure that the application of paint did not create an unnecessary risk of injury. Where personal injuries resulted from a failure to repair then the duty of care arose under the 1972 Act, but where the Act did not apply, as in the instant case, a landlord owed a duty to take reasonable care not to create a risk of unnecessary injury. The presence of the rain increased the likelihood of slipping on the steps and the presence of paint on the steps significantly increased the risk of slipping, but that of itself did not establish liability. The paint was suitable for use outside and contained no warning against its use on steps or of it becoming slippery when wet. The references to “semi-gloss” and producing a sheen might have alerted the knowledgeable to the fact that the paint was not suitable for use on steps, but not the man on the street. It was not unreasonable to have applied the paint to the steps in light of the expert evidence, and there was no breach of duty (paras 101-105).
Claim dismissed

END

Queens Bench Division 6 July 2012

The claimant, a woman known as M, had made a complaint against the police service. She agreed to deal with her complaint by way of the Local Resolution Process, but was subsequently dissatisfied with the LRP and appealed to the Independent Police Complaints Commission. Her appeal was rejected.

Following litigation the matter arrived in the High Court. At issue was the rationale of paragraph 8(3) of Schedule 3 of the Police Reform Act 2002 (which concerned the admissibility, in subsequent litigation, of statements made by police under the LRP). The Judge offered an analogy between the LRP and mediation in civil proceedings. In proper police disciplinary investigations, officers being investigated are given a warning that they are not obliged to answer any questions (similar to the warning given to suspects in criminal proceedings). In the LRP, no such warning is given, as the LRP was not intended as a disciplinary process.

In the same way that frankness between parties is encouraged in mediation, the LRP encourages frankness in investigations. Paragraph 8(3) was a clear and absolute prohibition on the admission of statements made under the LRP. The Judge held that they would be inadmissible in any subsequent criminal, civil or disciplinary proceedings.

Comment

The decision confirms that the LRP is a pragmatic instrument for openness and co-operation between the police and public. The decision means that police forces will be better able to build and maintain positive relationships with the communities they serve.

END