Liability SIG Sessions
Loss adjusters who work in the liability arena need to ensure they maintain an up to date understanding of Case Law, attendees at the Liability SIG were told.
Simon Burley, of the CILA's Liability SIG Committee, and a director at Delta Claims Services, gave delegates a legal update during his early morning session, using recent cases as a guideline of how courts now view particular sets of circumstances.
In Palmer v Cornwall County Council, the claim concerned a 14-year-old boy who was hit in the eye by a rock thrown by another pupil in the play area. The injured party issued proceedings against the local authority.
Supervision at lunchtimes was provided by two dinner ladies, one was outside while the other was inside, meaning the play area was supervised by one person. Although there was some difficulty in understanding how many pupils were under her supervision it was accepted that it could have been in the region of 300. In her evidence the supervisor admitted that she spent more time overseeing the younger pupils, which did not include the claimant.
The Court of Appeal concluded that the level of supervision was clearly inadequate. In reaching this decision they also asked if the accident would have occurred even if the levels of supervision had been higher – they felt it would not have done.
“This case gives adjuster a guideline as to what supervision is not adequate but leaves it uncertain as to at what point supervision becomes adequate. One imagines that the ratio will depend upon the circumstances and the evidence of risk assessments,” Simon said.
The second case, Samuel David Harris v Perry & Harris, was another supervision case.
Mr & Mrs Perry hired a bouncy castle for a party. A 15 year old climbed on it, started to do somersaults and struck the claimant on the head, leaving him with a fractured scull.
The lower Court found for the claimant stating there was inadequate supervision by the Perrys.
The Court of Appeal however found it was not reasonably foreseeable that boisterous play on a bouncy castle would involve a significant risk of serious harm and, therefore, parents who hired a bouncy castle for a children’s party did not have a duty of care to keep the children playing on it under uninterrupted supervision.
The Court also expressed doubt that even if the supervision had been better it was unlikely to have prevented an accident of this type.
“The case is important because for adjusters as it appears to show that the Courts do not require constant supervision of children at play and it also demonstrates that the Courts will ask if an accident could have been prevented even with close supervision,” Simon said.
"Most liability loss adjusters are required by insurers to attend the scene of the loss, to obtain a good understanding of what has happened, the extent of damage and/or injury and the gather all the relevant evidence.
"Thereafter the adjuster is required to report to insurers setting out the circumstances and reaching a recommendation as to the insured’s potential liability," he added.
The other cases Simon explored were:
Cuthbert v Gair (2008)
This case has gained a lot of publicity in recent months and there is further information on it on the CILA website. The case considered when an insurer could recover the cost of adjusters’ fees when pursuing a recovery. The court held that the insurer could not recover the money they had spent on adjusters’ fees; however it is important to understand why.
Cuthbert was injured while at an equestrian event. She sued the Equestrian Centre who instructed adjusters to investigate, subsequently, when it litigated, the insurers instructed solicitors to defend the claim.
Cuthbert then discontinued her claim and the defendants requested a detailed assessment of its costs and sought to recover the cost of the work undertaken by the loss adjusters.
The court held that a person that acted without a solicitor could not recover any fees and expenses paid to another party for work of a kind which a solicitor could have done.
The court also looked at the work undertaken after the defendant had instructed solicitors and stated that if the solicitors had instructed the adjusters for assistance then they could have recovered those costs as a profit cost – not as a disbursement. In this case however there was no true agency agreement (no letter of instruction or terms of engagement) and therefore there could be no recovery.
It is a decision that probably confirms that adjusters’ fees should not form part of a recovery, the only exception being where they were instructed by solicitors.”
Alexis v London Borough of Newham (2009)
The claimant was a school teacher who was poisoned by a pupil. The pupil concerned had added cleaning fluid to a bottle of water. The cleaning fluid had been added when the pupil had been allowed unsupervised access to the claimant’s locked classroom.
The claimant recovered from the physical damage fairly quickly but strangely seems unable to face teaching again.
The judge stated that it was not reasonably foreseeable that a pupil, left unsupervised, would attempt to poison a teacher but it was foreseeable that he might indulge in a prank, the judge thought the case passed the test of forseeability.
It was also accepted that the defendant owed a duty to teachers to take all precautions as were reasonable to prevent or minimise the risk of injury.
However, the court heard how the school had a sensible policy of locking empty classrooms and not allowing pupils unsupervised access, it was accepted that this practice must allow exceptions (the judge said it would be absurd not to allow a situation where a teacher could not ask a pupil to pop along to an empty classroom to collect something). The discretion had not been negligently exercised as the teacher had no reason to believe that the pupil would seek to poison another teacher therefore there was no liability.
Simonds v Isle of Wight Council (2003)
Whilst not a recent case, this warrants a mention as it addressed the balance between ordinary play and dangerous play and is therefore relevant to the consideration of much of the current case law.
The claimant broke his arm after jumping from a swing during a school sports day. The court did not find the local authority liable as it would not have been reasonable to impose on the school any legal duty to immobilise the swings and that the accident that occurred was one of ordinary play.
Kearn Price v Kent County Council (2002)
This is another older case involving an injury whilst at play after a 14-year-old was struck in the face by a leather football. The evidence was that the school had considered the footballs to be dangerous and had banned their use within the school. However, they had not done enough to implement the ban and the evidence was that the ban was frequently ignored. The courts found for the defendant.
Charles Baldacchio v West Wittering Estate (2008)
This is an example of a recent case which confirms the courts’ intentions not to create too onerous responsibilities for occupants and to underline that individuals must take some responsibility for their own actions.
This follows a pattern from earlier cases including Tomlinson v Congleton (2003), Keown v Coventry Healthcare Trust (2006) and Evans v Kosmar (2007).
The claimant was a 14-year-old who made his way along a wooden breakwater on the defendant’s beach. He then climbed up a navigational beacon. The boy was one of a party of boys who had been spotted going out to the beacon and a local lifeguard was making his way on a jet ski to stopping their activity.
The claimant dived from the beacon and sustained injury to his neck rendering him tetraplegic. The accident occurred on a hot summer day when it was estimated there were up to 11,000 people on the beach.
The claim was pursued under the Occupiers Liability Act (1957), the claimant arguing that the beacon represented an allurement to the children and there should have been a warning sign.
The defence accepted the claimant was a lawful visitor to the beach but was a trespasser so far as the beacon was concerned. They also argued that even if there had been a warning – it would have been ignored by the claimant.
Also argued that they had a reasonable system of supervision and the beach was adequately manned by lifeguards/beach patrol staff.
The Judge found for the defendants stating:
- He accepted he was a trespasser and thus the 1957 Act did not apply
- Their was no duty to warn of dangers that are perfectly obvious
- At 14 the claimant was considered to be reasonably aware, he failed to judge the type of dive needed
- A notice would not have stopped him
- There was no undisclosed trap or hazard
- Supervision was adequate.
Anderson v Lyotier and Lyotier and Portejoie 2008
The claimant was badly injured whilst on a skiing holiday. His court action was taken against the company with whom he booked the holiday - they brought in the ski instructor as a co-defendant.
The accident happened when the claimant - a relative beginner - was allowed to ski on the off-piste area.
The claimant was part of a group of mixed ability and after two days of tuition they were allowed to ski off-piste on day three. During that session, and unseen by the instructor, the claimant struggled and at one stage hit a tree
On day four they were again off-piste and the claimant fell frequently. On day-six they skied on a steep off-piste slope and the claimant hit a tree once again. Injuries rendered him a tetraplegic.
The ski instructor was found to be negligent as the claimant did not have the skills to ski in that terrain with reasonable safety. The court agreed that it was reasonably foreseeable that on such terrain a fall was likely and the injuries sustained were possible.
The claimant was found 1/3 liable on the basis of contrib.
The judge did go out of his way to emphasise that this case did not open the door to anyone who sustains an injury under supervision to claim against the instructor.
Jennifer Hunt v Chapter of Ripon Cathedral 2008
This is an important case for the occupiers of historic buildings and their insurers. A visitor to Ripon Cathedral sustained an ankle injury after stepping into a depression on a step leading to the crypt.
The court ruled in favour of the defendant finding that the occupiers had taken reasonable care to protect visitors – they had undertaken a risk assessment, the area was well lit and there was a one- way system in place with good signage.
This was described by the claims manager as the court taking a ‘common sense approach’. This case appears to set a precedent that uneven surfaces are acceptable in historic buildings so long as the occupier can show that he has taken sufficient care.
Drake v Harbour 2008
Most of the cases we have looked at are supportive of the defendant so we had better end this slide as we started it - with a win for the claimant. This case concerned a fire in a house that was being worked upon by the defendant. The claimant had moved out.
It was found that the contractor had been negligent, but the claimant could not prove this negligence was the cause of the fire. The court found that where the loss ensued which was of a kind likely to have resulted from such negligence that would ordinarily be enough to enable a court to infer that it was probably so caused, even if the claimant was unable to prove positively the precise mechanism.
Lord Justice Toulson said that the extent to which positive or scientific proof of causation was required was a matter of judgment in each case and depended on the evidence as a whole.
The court had to consider any alternative theories of causation advanced by the defendant before reaching its conclusion about where the probability lay.
If it concluded that the only alternative suggestions put forward by the defendant were on balance improbable, which was likely to fortify its conclusion that it was legitimate to infer that the loss was caused by the proven negligence.
This is not good news for those of us who act for defendants in relation to subrogated actions for fire. It appears our standard response of prove it may not be quite so valid in future.
Corby Group Litigation 2009
Corby was a new town created in the 1950s and was dominated by a steel plant. Most of the working population were employed at the steel works.
In the 1970s the town declined dramatically - imported steel was far cheaper than Corby produced steel and the plant closed in 1980. Out of a working population of 16,000 there were 11,500 out of work.
The local council decided a programme of regeneration was essential and after successful applications for enterprise zone status and derelict land grants it started to buy the derelict land off British Steel. It purchased the land in parcels carrying out reclamation as it went.
This programme was considered a success and the area began to redevelop. However between 1985 and 1999 a group of children were born with limb reduction defects (mainly missing fingers and clubbed feet).
The child claimants were represented in a group action where it was argued that small particles of waste material had become airborne during the reclamation and were inhaled by the mothers early in their pregnancies.
It was claimed that during the waste removal the transportation of the waste was undertaken in ‘unsheeted lorries’ on public roads (It only became legally necessary to sheet all lorries in 1992).
It was also argued that dust from the reclamation sites could travel for up to 4kms.
A number of unhealthy substances were shown to be found within the waste. It was accepted that these substances were hazardous. However; in the 80s and 90s none of the substances listed were known to be hazardous to pregnant women.
The work was undertaken in liaison with all the relevant authorities and done in accordance with their instruction and guidance. However it was found that over a number of years the management of the process was at times very poor and the whole project appeared to be too big for those handling it. The judgement refers to years of neglect in the way the project was managed.
A number of experts and consultants had been appointed prior to the commencement of the reclamation and none of these had warned of the potential dangers to pregnant women. The Judge found for the group claimant subject to causation on individual cases.
In a damming conclusion to the judgement The Honourable Mr Justice Arkenhead stated he found CBC liable in public nuisance, negligence and in respect to their actions post 1992 they were also in breach of Statutory Duty (Environmental Protection Act 1990).
One is left asking the question, could these injuries be foreseen?
The Judgement runs to 288 pages, it is a thrilling read and is available on the Internet. The Judgement deals with the question of forseeability. It sets out:
Q: Whether any alleged loss arising out of such breach was foreseeable
A: Yes.
Nottinghamshire & Derbyshire deafness litigation 2009
In the Notts and Derby deafness litigation the Court of Appeal has just announced its decision. The Judges concluded that noise levels above 85 decibels have always been unsafe and that an Employers actual knowledge of this fact or not is irrelevant.
Effectively this is saying that the standard for ‘safe’ in the workplace is to be judged with the benefit of hindsight and appears to ignore what the HSE and other experts considered to be safe at the relevant time.
This decision identifies those workplaces that have noise levels of 85 Db + as being unsafe and therefore in breach of S29 of the Factories Act 1961.
Appeals on both cases are considered likely.
However there is a clear message here, the Courts don’t like the State of Knowledge defence and will seek ways around it – particularly when there are potentially a large number of effected people.
Carol Walton v Joanne Kirk 2009
In this case the Claimant made false statements during the proceedings for injury following an RTA. Her claim was for £750,000.
The defendant insurer believed the claim to be exaggerated and commissioned surveillance. The surveillance demonstrated a significant disparity between her claimed condition and the actual condition.
The claim was settled for £25,000 with the claimant paying the insurer’s costs of £21,000.
The insurers then sought to commit the claimant for contempt of court and the claimant was found guilty. It is hoped that this sends a strong message to future potential fraudsters.
Shah v Ul-Haq 2009
Mr UL-Haq was injured in an RTA, he and his wife suffered whiplash injuries and it was claimed his mother also had a whiplash injury.
Both Mr Ul-Haq and his wife gave evidence in court in support of his mother’s injury.
The defence successfully argued that the mother had not even been in the car and that Mr Ul-Haq and his wife had conspired to support her fraudulent claim.
The question for the courts was whether they had the power to strike out the claims for Mr Ul-Haq and his wife as the perpetrators of a fraud as they were seeking to benefit from an illegal activity.
The insurer’s representatives laboured the point that the courts had a duty to stamp out this sort of behaviour and demonstrated that they alone had challenged 157 “phantom passenger” claims in the last 12 months.
The court however saw it differently, whilst it did award costs against the claimant it would not allow the claims to be struck out.
The courts said it was clear that there is established case law which shows a claimant will not be deprived of damages because they have fraudulently attempted to gain more than their entitlement.
They suggest that if this change is needed it must come via an Act of Parliament.
Download 'State of the Nation' Presentation (Powerpoint format, 149Kb)
Download Lecture Notes (PDF format, 120Kb)
Legal Professional Privilege And Without Prejudice Communications: A Practical Overview For Loss Adjusters
This presentation, by Elspeth Owens of 4 Pump Court, sought to provide an overview of the rules governing disclosure and to examine the application of Legal Professional Privilege in the particular context of documents procured or produced by loss adjusters.
Download Lecture Notes (PDF format, 137Kb)
