DOLMANS INSURANCE BULLETIN

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1 DOLMANS INSURANCE BULLETIN Welcome to the June 2018 edition of the Dolmans Insurance Bulletin In this issue we cover: REPORT ON Applying reasonable and safe systems to latent defects - Gareth Morgan v Rhondda Cynon Taf County Borough Council RECENT CASE UPDATE Causation - foreseeability - remoteness Credibility - dishonesty - fraudulent claims Discontinuance - fundamental dishonesty Road traffic accident - fatal accident claims - divorce Personal injury - fear Vicarious liability Capital Tower Cardiff If there are any items you would like us to examine, or if you would like to include a comment on these pages, please the editor, Justin Harris, Partner, at justinh@dolmans.co.uk 1

2 DOLMANS REPORT ON APPLYING REASONABLE AND SAFE SYSTEMS TO LATENT DEFECTS Gareth Morgan v Rhondda Cynon Taf County Borough Council The Claimant in the above matter alleged that, on 6 October 2014, he was attending a spinning class at Tonyrefail Leisure Centre when a bolt on the spinning bike that he was using snapped off, causing him to sustain personal injuries. It was alleged that the Defendant Authority was in breach of the Occupiers Liability Act 1957 and that it was negligent. It was clear that the Claimant was likely to prove that his accident occurred in the circumstances alleged and that he was a lawful visitor to the premises, in accordance with the terms of the Occupiers Liability Act Dolmans (representing the Defendant Authority) appreciated from the outset, therefore, that to avoid liability the Defendant needed to convince the Trial Judge that it had taken reasonable care in all the circumstances and that strong supportive witness evidence would be crucial to achieve this. The Defendant Authority argued that the cause of the Claimant s alleged accident was an unforeseen latent defect for which it was not liable. Witness Evidence No Underlying Issues Witness evidence on behalf of the Defendant Authority was obtained from the current manager and assistant manager of the centre. They both confirmed that, following the post-accident Inspection, the pedal itself was not damaged and that the locating bolt (as described by the Claimant) had snapped. Although the bikes were checked before classes, the Defendant Authority argued that this type of issue could not have been picked up during these checks. Appropriate risk assessments were undertaken by the manager prior to the date of the Claimant s alleged accident and these had not identified any underlying issues with the bikes and, particularly, the pedals and/or bolts. 2

3 DOLMANS REPORT ON Independent Evidence An Unforeseen Catastrophic Failure The bikes were used on a regular basis, with approximately 8 spinning classes being held every week. On average, approximately 14 people attended each class. In the 12 month period prior to the Claimant s alleged accident there would, therefore, have been over 1,000 people attending these classes. With no similar reported incidents having been reported during this period, the Defendant argued that it could not reasonably have been expected to foresee the alleged issue. The bikes underwent regular maintenance and were checked, cleaned and oiled on a weekly basis. The pedals and crank bolts were checked for tightness at the same time. In addition, the bikes were serviced annually by an independent reputable company and, indeed, had last undergone such servicing prior to the Claimant s alleged accident on 8 August At that time, it was recorded that all bikes (including that which was the subject of the Claimant s claim) were safe and in good working order. Dolmans (on behalf of the Defendant Authority) spoke with the independent company and, specifically, the director who had undertaken the servicing. He provided a Witness Statement and gave oral evidence at Trial to the effect that the locating bolt for the pedal had snapped off. Although this can happen with bikes used for spinning classes when particular force is applied to pedals, he stated that this was a highly unusual occurrence for the bike in question, which he described as a very arduous item. Indeed, he did not recall being called to a similar repair (for this particular bike) either before or after the Claimant s alleged accident. There was no issue with the pedal itself and, in any event, it was the locating bolt that broke for some reason. The Defendant Authority kept a stock of pedals as sometimes the bearings of the pedals could wear out or grips could wear away, etc. However, the pedals utilised by the Defendant were fit for their purpose and compliant with the bikes on site. The independent witness from the servicing company confirmed this and could only assume that there might have been some unforeseen weakness in the bolt itself, which he described as a catastrophic failure. He undertook an appropriate repair and the bike was thereafter ready for use again. The Claimant suggested that the bikes should have been serviced every six months, instead of annually. However, annual services were recommended and the last annual service prior to the date of the Claimant s alleged accident was undertaken well within six months of the date of the alleged accident (on 8 August 2014) in any event. The independent witness also gave evidence that as there was no way of foreseeing a problem, there was no way of preventing the same. Indeed, even if the bike had been serviced the day before, the locating bolt could have failed the next day according to the independent witness. 3

4 DOLMANS REPORT ON Claim Dismissed - A Reasonable and Safe System The District Judge accepted that the Claimant s accident had occurred in the circumstances alleged, but found that the accident had been caused by a latent defect that could not be discovered upon examination. The District Judge held that the Defendant Authority had a duty to keep the Claimant reasonably safe, but that this was not a strict liability issue. The burden was on the Defendant to show that it had acted reasonably and the District Judge was satisfied that the Defendant Authority had demonstrated a reasonable and safe system. As such, the District Judge dismissed the Claimant s claim and awarded the Defendant its costs, albeit not to be enforced without the Court s permission as QOCS applied. Conclusion This case demonstrates the importance of good supportive witness evidence, particularly when the burden is upon the Defendant to show that it had acted reasonably in all the circumstances. Clearly, the evidence adduced by the independent witness was crucial in persuading the Trial Judge that the Defendant Authority had overcome this burden. The accident had been caused by an unforeseen latent defect and the Defendant Authority was not held to be responsible for the same after taking account of all the evidence in this particular matter. supportive evidence Tom Danter Associate Dolmans Solicitors For further information regarding this article, please contact Tom Danter at tomd@dolmans.co.uk or visit our website at 4

5 DOLMANS RECENT CASE UPDATE Causation - Foreseeability - Remoteness Philip James Clay v TUI UK Ltd [2018] EWCA Civ 1177 The Claimant had been on a package holiday with his family to Tenerife with the Defendant tour operator. He and his wife were staying in one room and his parents were staying next door. Both rooms were two stories up and had balconies. One evening, the Claimant, his wife and his parents were having drinks on one of the balconies when they became trapped after the door to the balcony inadvertently locked. Having failed to attract attention from passers-by for 30 minutes, the Claimant decided to step across from the balcony to the other balcony outside his room. An ornamental ledge upon which the Claimant stood gave way and the Claimant fell to the terrace below. He sustained a fractured skull. The Claimant s case was that the hotel were negligent for which the Defendant was liable under the Package, Travel, Package Holidays and Package Tour Regulations At Trial, the locking mechanism on the door was found to be defective. However, the Claimant s claim failed on causation, with the Judge finding that the Claimant s actions were so unexpected and/or foolhardy as to be a novus actus interveniens. The Claimant appealed, but the Court of Appeal upheld the decision. In finding that there was a novus actus interveniens, the Judge had contrasted the fact that there was no danger, emergency or threat to the Claimant and his family from being trapped on the balcony, with the obvious risk of life threatening injury involved in standing on the ledge. That was the correct approach. The Judge had also correctly balanced the risk taken against the consequences of the breach of duty and had had appropriate regard to the degree of unreasonableness required for the Claimant s conduct to amount to a novus actus interveniens. The Judge plainly regarded the Claimant s strikingly new and independent act as being a highly unreasonable action. The Claimant s conduct was not reasonably foreseeable. It was unreasonable to a high degree. There was no necessity for the Claimant to take any risk. Therefore, a finding that there was a novus actus interveniens was clearly justified. 5

6 DOLMANS RECENT CASE UPDATE Credibility - Dishonesty - Fraudulent Claims Mirajuddin Molosi v (1) Cambridge Vibration Maintenance Service (2) Aviva Insurance Ltd [2018] EWHC 1288 The Claimant s claim arose out of a road traffic accident in February Liability was accepted by the Defendant, but causation was challenged on the basis that the collision was so minor that it could not have caused the Claimant any injury. Despite this (and the fact that a compliant Casey v Cartwright Statement had been served), the Court did not follow the special directions applicable to low velocity impact cases. Instead, the case was allocated to the Fast Track and the Defendant was not permitted to obtain their own medical evidence. At Trial, numerous inconsistencies and inaccuracies were drawn out by the Defendants. The Judge acknowledged the inconsistencies regarding the Claimant s recovery period, saying that they raised a question mark as to his reliability more generally. However, the Judge accepted that it was plausible that the Claimant had suffered a whiplash injury as a result of the accident and awarded him 2,750 in General Damages, making a finding that that the Claimant had exaggerated the seriousness of his injury to some degree. The Defendant appealed and argued that even though it had not pleaded dishonesty, the Judge should have found fundamental dishonesty on the part of the Claimant and should have dismissed the claim in its entirety pursuant to the Criminal Justice and Courts Act It was held that the Claimant s evidence was demonstrably inconsistent, unreliable and untruthful and he had lied about the number of accidents he had previously been involved in. Given his dishonesty about a fundamental matter, it was difficult to see how the Judge could have accepted the medical report, or any other part of his evidence, as to his injuries. There were fundamental inconsistencies between his evidence at Trial and what he had said in the CNF and there were inconsistencies in his evidence about his injury. The Defendant had proved that the Claimant had been fundamentally dishonest and the Judge should have dismissed the claim. Appeal allowed. Discontinuance - Fundamental Dishonesty Alpha Insurance A/S v Roche & Another [2018] EWHC 1342 (QB) The Claimants, C, the driver of a vehicle involved in a road traffic accident and her 13 year old son, brought an action for personal injury. The Defendant s Insurer, D, admitted its insured had been negligent, but alleged that the son had not been a passenger in the car. C discontinued their claim the day before Trial. The case was subject to QOCS. 6

7 DOLMANS RECENT CASE UPDATE D made an Application for the matter to stay in the Court list for an issue of fundamental dishonesty to be determined pursuant to CPR 44 PD 12.4(c) which provides that where a Claimant has served a Notice of Discontinuance, the Court may direct that issues arising out of an allegation that the claim was fundamentally dishonest be determined, notwithstanding that the notice has not been set aside pursuant to rule The Judge refused D s Application on the grounds that a further hearing would involve a disproportionate use of limited and precious Court resources and there was nothing of any particular exceptional quality about this case that should cause him to set aside further Court time to allow this isolated issue of dishonesty to be ventilated. D appealed. The Judge held that there had been an error of law at first instance as CPR 44 PD 12.4(c) does not require exceptionality. The correct approach is to regard the discretion under that sub -section as an unfettered one requiring the weighing up of all relevant considerations in accordance with the overriding objective. The Judge exercised the discretion afresh. D s case raised a serious allegation involving the suggestion that C had encouraged her young son to bring a false claim. Whilst the Judge did not consider D s case was particularly strong, it was based on evidence that was capable of being accepted. Two factors which weighed heavily in the balance were the very late stage at which the claim was discontinued and the complete absence of an explanation from C. The Judge allowed the appeal and directed that the issues relating to fundamental dishonesty be determined. Road Traffic Accident - Fatal Accident Claims - Divorce CC (Widow & Dependant of JC (Deceased) on behalf of herself and his Dependants v TD [2018] EWHC 1240 (QB) The Claimant and her husband were in the middle of divorce proceedings when he was killed in a road traffic accident. The Court was required to determine the level of damages to award the Claimant, with the Claimant claiming that notwithstanding their separation at the time of his death, she would have reconciled with her husband and terminated the divorce proceedings, particularly once she had fully considered the financial implications of divorce. The Claimant and her husband met in They married in The husband was the main breadwinner. They began marriage counselling in 2012, but in November 2013 the Claimant obtained divorce advice from a lawyer. The Claimant moved out in January 2014 with their two youngest children and then filed for divorce. In May 2014, it was agreed that the family home could be sold. 7

8 DOLMANS RECENT CASE UPDATE The Court held that the marriage counselling in 2012 showed that the marriage was in trouble for some considerable time before the separation in January The communications between the Claimant had her lawyer indicated that the Claimant was intent on divorce. There was nothing to suggest she had retreated from that position. The husband had begun an affair and did not contest the divorce proceedings. In all the circumstances, the Court did not believe that the Claimant would have changed her mind about the divorce. There was, therefore, no significant chance that, but for his death, they would have reconciled. The Claimant s claim for loss of financial dependency was, therefore, limited to what she would have received by way of maintenance payments until 2020 when the youngest child turned 18. Personal Injury - Fear Kimathi & Others v Foreign & Commonwealth Office [2018] EWHC 1305 (QB) The Claimants, K, were pursuing claims for damages in negligence and trespass to the person for alleged abuses arising during the course of the Kenyan Emergency during the 1950 s. K claimed that they were detained in villages or detention camps and that the threat of force compelled them to remain in the villages/detention camps and to carry out labour. K s claims were all statute barred unless the Court had the discretionary power under s.33 of the Limitation Act 1980 to exclude the time limit for actions in respect of personal injury. Some of the Claimants had previously applied to amend their Particulars of Injury to plead psychiatric injury, but the amendments had been refused. The Judge was required to rule, on a preliminary issue, of whether fear, caused either by the tort of negligence or trespass, amounts to personal injury so that the Court has the discretionary power to exclude the 3 year limitation period which arises under section 11 of the 1980 Act. K alleged that fear produced identifiable physiological effect: the release of adrenaline, an increase in blood pressure and an increase in heart rate. They further alleged that the threshold for actionable injury in physical personal injury cases is low. Awarding damages for fear is an extension of the existing law only if a distinction is drawn between physical and mental injuries. K submitted no such distinction was justifiable. K further submitted that as their treatment engaged their human rights this should tip the balance on this issue in their favour. The Judge rejected K s submissions. The position clearly founded in the authorities is that nothing short of a recognised psychiatric condition can amount to a personal injury. As regards the human rights submission, as fear was not a personal injury there was no balance to tip. 8

9 DOLMANS RECENT CASE UPDATE Vicarious Liability Kafagi v JBW Group Limited [2018] EWCA Civ 1157 The Claimant, K, brought a claim against the Defendant Company, JBW, alleging that JBW was vicariously liable for torts against him, including trespass to the person and fraudulent misrepresentation, committed by two bailiffs, B and F. JBW had sub-contracted the collection of council tax debts to B, but JBW denied vicarious liability on the grounds that B was a selfemployed bailiff and it had no record of engaging F at all. K was unsuccessful at first instance and on appeal. K appealed to the Court of Appeal submitting that there had been a failure to consider whether there had been a relationship akin to that of employment. The Court of Appeal dismissed the appeal. B ran his own business. He could turn down work offered by JBW. B worked for other clients and was more a potential competitor to JBW than someone integrated within its business. B was at liberty to conduct the collection of a debt in whatever legal manner he saw fit without control from JBW. He was at liberty to share the work with another, as B had done here with F. Like all certified bailiffs, B had had to provide a personal bond into Court to serve as security against which those who felt they had been wronged by B could recover. That was required by the regulatory framework and was nothing to do with JBW. B maintained his own indemnity insurance. There was no contractual relationship at all between F and JBW. Accordingly, the relationship between JBW and B and F could not be regarded as akin to a relationship of employment. For further information on any of the above cases, please contact: Amanda Evans at amandae@dolmans.co.uk or Judith Blades at judithb@dolmans.co.uk 9

10 DOLMANS TRAINING OPPORTUNITIES At Dolmans, we want to ensure that you are kept informed and up-to-date about any changes and developments in the law. To assist you in this, we can offer a whole range of training seminars which are aimed at Local Authorities, their Brokers, Claims Handlers and Insurers. All seminars will be tailored to make sure that they cover the points relevant to your needs. Seminars we can offer include: Apportionment in HAVS cases Bullying, harassment, intimidation and victimisation in the workplace personal injury claims Conditional Fee Agreements and costs issues Corporate manslaughter Data Protection Defending claims the approach to risk management Display Screen Regulations duties on employers Employers liability update Employers liability claims investigation for managers and supervisors Flooding and drainage duties and powers of landowners and Local Authorities for drainage under the Land Drainage Act Common law rights and duties of landowners in respect of drainage Flooding and drainage duties and powers of Highway Authorities for drainage and flooding under the Highways Act Consideration of case law relating to the civil liabilities of the Highway Authority in respect of highway waters Highways training Housing disrepair claims Industrial disease for Defendants The Jackson Reforms (to include : costs budgeting; disclosure of funding arrangements; disclosure of medical records; non party costs orders; part 36/Calderbank offers; qualified one way costs shifting (QWOCS); strikeout/fundamental dishonesty/fraud; 10% increase in General Damages) Liability of Local Education Authority for accidents involving children Ministry of Justice reforms Pre-action protocol in relation to occupational disease claims overview and tactics Public liability claims update If you would like any further information in relation to any of our training seminars, or wish to have an informal chat regarding any of the above, please contact our Training Partner, Melanie Standley at melanies@dolmans.co.uk 10