IN THE HIGH COURT OF JUSTICE 1999 FOLIO No.343
QUEEN’S BENCH DIVISION
COMMERCIAL COURT
THE HONOURABLE MR. JUSTICE MOORE-BICK
BETWEEN
Claimants
Defendant
AND 2000 Folio No.481
BETWEEN
Claimant
Defendants
Lord Goldsmith Q.C. and Mr. Timothy Howe instructed by Simmons & Simmons appeared for the claimants in the Lloyd’s TSB action (1999 Folio No. 343).
Mr. Nicholas Strauss Q.C. and Mr. Laurence Rabinowitz instructed by Herbert Smith appeared for the claimants in the Abbey National action (2000 Folio No. 481).
Mr. Michael Brindle Q.C. and Mr. Guy Philipps instructed by Barlow Lyde & Gilbert appeared for the defendants in both actions.
Pursuant to the Practice Statement issued by the Master of the Rolls on 9th July 1990 I hereby certify that the attached text records my judgment in this matter and direct that no further record or transcript of the same need be made.
“Subject to the Limit of Indemnity, the Underwriters shall be liable only for that part of each and every third party claim during the Policy Period, . . . . . . . . which exceeds the Deductible stated in Item 7 of the Schedule.
The Deductible shall apply to each and every third party claim and shall be subject to no aggregate limitation.
If a series of third party claims shall result from any single act or omission (or a related series of acts or omissions) then, irrespective of the total number of claims, all such third party claims shall be considered to be a single third party claim for the purposes of the application of the Deductible.”
“If a series of third party claims shall result from any single negligent act, negligent error or negligent omission or breach of statutory provisions including breach of statutory duty, or compliance with a Restitutionary Order made under the provisions of the Financial Services Act 1986 (or a related series of negligent acts, negligent errors or negligent omissions or breaches of statutory provisions including breaches of statutory duties, or compliance with a Restitutionary Orders made under the provisions of the Financial Services Act 1986) then irrespective of the total number of claims, all such third party claims shall be considered to be a single third party claim for the purposes of the application of the Deductible.”
In the Lloyds TSB action:
“Whether, as is alleged in paragraph 14A of the Amended Particulars of Claim, the Mis-selling Claims constitute a series of third party claims which resulted from:
(1) A single act or omission by the TSB Companies their officers or employees, as pleaded in paragraph 15 of the Amended Particulars of Claim, or
(2) A related series of acts or omissions by the TSB Companies their officers or employees as pleaded in paragraph 16 of the Amended Particulars of Claim
and are therefore to be considered a single third party claim subject to a single Deductible for the purposes of Condition 2 of the PI Policy.”
and in the Abbey National action:
“Whether the third party claims for which the Claimant was liable were the result of
(a) a single negligent act, error or omission and/or breach of duty under the Financial Services Act 1986 and LAUTRO and SIB rules applicable to it between 1988 and 1994; alternatively
(b) a related series of such acts, errors, omissions and/or breaches of duty under the Financial Services Act 1986 and LAUTRO and SIB rules applicable to it between 1988 and 1994
and accordingly fall for the purposes of determining the Deductible under the insurance policy to be regarded as a single third party claim.”
For the purposes of the trial of these issues the court is required to assume that all the facts pleaded in the particulars of claim in each case are true, that the claims in question fall within the insuring clauses of the policies and that the acts and omissions on the part of the claimants are acts and omissions as defined in the policies.
“My Lords, we have had large citation of authority in this case, and much discussion on what is the true meaning of causa proxima. Yet I think the case turns on a pure question of fact to be determined by common-sense principles. What was the cause of the loss of the ship? I do not think the ordinary man would have any difficulty in answering she was lost because she was torpedoed.”
And at page 363, having referred to the fact that there may be two possible causes to consider, he said
“But the moment that the two clauses have to be construed together it becomes vital to determine under which expression it falls. The solution will always lie in settling as a question of fact which of the two causes was what I will venture to call (though I shrink from the multiplication of epithets) the dominant cause of the two. In other words, you seek for the causa proxima, if it is well understood that the question of which is proxima is not solved by the mere point of order in time.”
Similar expressions of opinion can be found in the other speeches.
“What is meant by "personal injury by accident"? Mr. Powell, in his very able argument, contended that there must be, first, a personal injury; second, that there must be an accident causing it; third, that such accident must be the proximate cause of the injury, and that nothing more remote than the proximate cause can be properly taken into account. My Lords, I cannot accede to this contention. Assuming that there must be something unintended and unexpected besides the personal injury sustained, or, in other words, assuming that there must be a personal injury and an accident causing it, I cannot agree with Mr. Powell that this statute ought to be construed as if it were a policy of insurance against accidents.
In an action on a policy the causa proxima is alone considered in ascertaining the cause of loss; but in cases of other contracts and in questions of tort the causa causans is by no means disregarded.”
“Next, the accident must be one "arising out of" the employment. There must be some relation of cause and effect between the employment and the accident, as well as between the accident and the injury.
My Lords, I think some of our difficulties in applying the Act are due to this. Courts of law have frequently been obliged to consider, especially in actions on policies of insurance, what is to be regarded as the cause of some particular event. In one sense every event is preceded by many causes. There is the "causa proxima," the "causa causans," the "causa sine qua non." I will not pursue scholastic theories of causation. The "causa proxima" is alone considered in actions on a policy, as a general rule. I do not think that is the proper rule for cases under the section now under discussion, for the reasons explained by Lord Lindley in Fenton v. Thorley.”
“The claims resulted from a single act or omission of one of the claimants’ officers or employees, or from a related series of acts or omissions of two or more of the claimants’ officers and/or employees, and are therefore to be considered a single third party claim subject to a single Deductible for the purposes of the policy.”