England and Wales High Court (Queen's Bench Division) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
LIVERPOOL DISTRICT REGISTRY

		Manchester Civil Justice Centre Crown Square, Manchester
		5th March 2009

The Honourable Mr Justice Coulson:

A. INTRODUCTION

1. By a policy of insurance effective for twelve months from 12 September 2000, the defendant ("the Zurich") agreed to indemnify the claimant ("Mr Porter") against loss of or damage to his property known as 'Claremond', Landican Lane, Bebington, Wirral, Merseyside L63 6HW ("the property") and the contents and personal possessions within.
2. General Exclusion Clause 1 of the policy excluded "any wilful or malicious act by a member of the family or by a person lawfully at or in the home". In addition, Condition 3 of the policy required Mr Porter to co-operate with the Zurich in various ways, and Condition 6 required him "and members of the family [to] take all reasonable steps to safeguard against loss, damage, accident or injury".
3. On the evening of 27 March 2001, following a series of disastrous events in his business and personal life, Mr Porter, who had been drinking heavily and was suffering from a persistent delusional disorder, decided to kill himself by setting fire to the property. He set a fire but, once a large part of the living area was ablaze, he changed his mind and escaped from the property. The property was severely damaged in the fire and was rendered uninhabitable. Fortunately, no-one was injured, although the family dog died a few days later due to the effects of smoke inhalation.
4. The principal claim in these proceedings comprises Mr Porter's claim against the Zurich, pursuant to the terms of the insurance policy, for the damage caused by the fire. The Zurich defend that claim on the grounds that, because Mr Porter started the fire intentionally, he cannot recover under the policy, because that would be contrary to public policy and/or the general law of insurance and/or because the fire arose from his wilful or malicious act, and was therefore excluded by General Exclusion Clause 1. In response, it is alleged that, so grave was Mr Porter's mental illness at the time of the fire, his "thoughts and judgement were grossly impaired and he was not acting as a free agent"^[1]. Accordingly, it is said that neither the public policy nor the contractual exclusion clause were triggered, because, although it is admitted that he set fire to the property, Mr Porter "did not do so deliberately, wilfully or maliciously"^[2].
5. After the fire, once the property had been boarded up, there were a succession of three thefts from the property. Although claims were made by or on behalf of Mr Porter to the Zurich in respect of these three thefts, the loss adjusters appointed, McLaren Toplis, were unable to make any progress at all in their investigations of the circumstances. Despite their efforts, no meetings took place with Mr and Mrs Porter, no inspections of the property could be arranged, and no statements were taken. Accordingly, the Zurich defend the theft claims on the grounds that Mr Porter (and/or those acting on his behalf) were in breach of Condition 3 of the policy (co-operation), and that the consequences of those breaches equate to or cancel out any claim under the policy that Mr Porter would otherwise have.
6. The trial on liability only took place on 24^th, 25^th and 26^th February 2009. At the conclusion of the hearing I told the parties that I would hand down a written judgment on Thursday, 5^th March. This is that Judgment and I should, at its outset, acknowledge the considerable assistance that I received from both counsel during this trial.
7. I propose to deal with the fire claim in this way. At Section B below, I deal with the principles of law, in particular insurance law, applicable to circumstances such as these. At Section C below I set out the background to the fire and, at Section D below, I deal in greater detail with the relevant events of the 26th and 27th March 2001. At Section E below, I summarise the medical evidence, including the contemporaneous medical records and the written and oral evidence of the two expert psychiatrists. At Section F below, I set out my analysis and conclusions in respect of the fire claim.
8. In respect of the theft claims, I deal in Section G below with the relevant facts surrounding the three theft claims. At Section H, I identify the issues arising out of the alleged breaches by Mr Porter of his duty to co-operate, pursuant to Condition 3 of the policy. Thereafter, at Section I, I set out my analysis and conclusions in respect of the allegations of breach and causation. There is a short summary of my conclusions at Section J below.

B. THE PRINCIPLES OF LAW APPLICABLE TO THE FIRE CLAIM

B1. Public Policy

9. It is trite law that the assured may not recover under a policy of insurance in respect of a loss intentionally caused by his own criminal act: see Beresford v Royal Insurance Co [1938] A.C.586, and Hardy v Motor Insurers' Bureau [1964] 2 QB 745. This rule is founded on the principle of public policy applicable to all contracts, that a court will not assist a criminal who seeks to recover any kind of benefit or indemnity for his crime, for to do so would remove a restraint upon the commission of crimes: see Gray v Barr [1971] 2 QB 554. In the present case, it is not disputed that, in setting fire to a property that was both mortgaged and the subject of two other charges in favour of third parties, Mr Porter's actions on the night of 27 March 2007 amounted to the crime of arson.
10. In Beresford, the claim made by the personal representative of a man who committed suicide, to recover under his life assurance policy succeeded at first instance, but was dismissed by the Court of Appeal and subsequently by the House of Lords. At the time, suicide was a crime. The jury had been asked, and answered in the negative, the question whether the deceased at the time of his death was "labouring under such a defective reason from disease of the mind as not to know the nature and quality of the act he was doing or, if he did know it, that he did not know that he was doing what was wrong?" That question, taken from Daniel M'Naghten's Case [1843] 10 Cl & Fin 200 is dealt with in greater detail in Section B4 below.
11. Having considered the facts of the case in Beresford, Lord Atkin said that there were two issues: the true construction of the contract of insurance and its enforceability. He concluded that, on the true construction of that contract of insurance, the insurers had indeed agreed with the assured to pay to his executors or assigns on his death the sum assured if he died by his own hand, whether sane or insane, after the expiration of one year from the commencement of the insurance. However, he went on to conclude that the contract was not enforceable in a court of law because, as a matter of public policy, courts will not assist anyone to profit from his own crime.

B2. Insurance Law Generally

12. It is a general rule of insurance law that an assured cannot normally recover the policy monies when he has intentionally brought about the event upon which the policy specifies the monies to be payable: see Britton v Royal Insurance Co (1866) 4 F & F 905 at 908. It has been said that this is a prima facie rule of construction of the contract of insurance, by which it is presumed that the insurers have not agreed to pay on that happening. Lord Atkin in Beresford summarised that general principle in this way;

"On ordinary principles of insurance law an assured cannot by his own deliberate act cause the event upon which the insurance money is payable. The insurers have not agreed to pay on that happening. The fire assured cannot recover if he intentionally burns down his house, nor the marine assured if he scuttles his ship, nor the life assured if he deliberately ends his own life. This is not the result of public policy, but of the correct construction of the contract."

Of course, a particular contract may be capable of being construed in a way that is not in accordance with this general rule of construction; indeed, Beresford is an example of such a contract.

B3. 'Wilful And Malicious'

13. In the present case, General Exclusion Clause 1 excluded claims arising out of 'any wilful or malicious act' by Mr Porter or a member of his family. Unsurprisingly, the Zurich seek to rely on that clause as an alternative defence to this claim.
14. In Re Young and Harston's Contract [1885] Ch Div Vol XXXI p168, the contract in question was a contract for the sale of land which provided for interest to be paid if there was a delay from any cause "other than wilful default on the part of the vendor". The Court of Appeal therefore had to consider what 'wilful' meant. Bowen LJ said that 'wilful':

"…is a word of familiar use in every branch of law, and although in some branches of the law it may have a special meaning, it generally, as used in courts of law, implies nothing blameable, but merely that the person of whose action or default the expression is used, is a free agent, and that what has been done arises from the spontaneous action of his will. It amounts to nothing more than this, that he knows what he is doing, and intends to do what he is doing, and is a free agent."

15. Of considerably greater relevance, in my judgement, is the decision of the Court of Appeal in Patrick v Royal London Mutual Insurance Society Ltd [2007] Lloyd's LR 85. In that case the fire in question was started by the assured's son, a boy of 11, and his friend. The insurance policy excluded "any wilful malicious or criminal act" carried out by the assured's immediate family, including children. The defendant insurers therefore maintained that, due to the wilful act of the son, they were not liable under the policy.
16. In his judgment, Tuckey LJ noted what Bowen LJ had said In Re Young and concluded that the passage referred to above "was not saying anything more than that wilful meant deliberate. It says that the actor must intend to do what he does but nothing about whether he should intend the consequences of his doing so". Of the exclusion clause itself he said this:

"15. It is tolerably clear what malicious or criminal acts are and I think that these words lend colour to what is meant by a wilful act. In this context it must be some act which is blameworthy. If so, something more than a deliberate or intentional act is contemplated. If that is all the word meant, the wide cover apparently provided by the extension would largely be taken away by the exclusion. Most acts, including negligent acts, are deliberate and intentional.

16. Obviously if the act is deliberate and intended to cause damage of the kind in question it would be within the exclusion. It will be wilful, as the judge held, and might also be malicious or criminal. But for an act to be wilful I do not think it necessary to go as far as this. It will be enough to show that the insured was reckless as to the consequence of his act… put more precisely for present purposes, if the insured is aware that what he is about to do risks damage of the kind which gives rise to the claim or does not care whether there is such a risk or not, he will act recklessly if he goes ahead and does it. I think such conduct was intended to be included in the exclusion and I would equate a reckless act with a wilful act for this purpose. This approach focuses on the state of the insured's mind when he does the act rather than its intended consequences. Defined in this way the exclusion does not require the insured to intend to cause damage of the kind in question"

B4. Insanity

17. Tuckey LJ's emphasis in Patrick on the assured's state of mind – either intending to cause damage of the kind in question, or being reckless as to whether such damage was caused or not - brings us to the single most important issue in the present case: Mr Porter's mental state when he set the fire. MacGillivray on Insurance Law, 11^th edition, states at paragraph 26-025 that:

"If the assured is so insane as not to be legally responsible for his actions, an act of incendiarism will not prevent him from recovering under the policy.

The question of the assured's insanity will probably have to be decided with reference to the M'Naghten rules."

I consider that, both as a matter of general principle, and by reference to the authorities noted below, this is a correct statement of the law. Where a claimant seeks to recover under a policy of insurance for the consequences of his own act in setting a fire, they will need to prove, on the balance of probabilities, that they were insane, within the meaning of the M'Naghten Rules, at the time of the fire. The nature and extent of this test should not be under-estimated.

18. In M'Naghten, Lord Chief Justice Tindal defined the test in these words:

"… the jurors ought to be told in all cases that every man is to be presumed to be sane, and to possess a sufficient degree of reason to be responsible for his crimes, until the contrary be proved to their satisfaction; and that to establish a defence on the ground of insanity, it must be clearly proved that, at the time of the committing of the act, the party accused was labouring under such a defect of reason, from disease of the mind, as not to know the nature and quality of the act he was doing; or, if he did know it, that he did not know he was doing what was wrong."

19. There have been two cases where this principle has arisen in the context of insurance law: one in the USA and one, more recently, in Scotland. In D'Autremont v Fire Association of Philadelphia 65 Hun 475 (1892) Macomber J said:

"In actions upon policies to cover damages occasioned by loss through fire, it is not a defence which the insurance company may avail itself of to show that the loss was caused by the carelessness, negligence, or want of care of the insured, or any of his agents or servants. The insurance company, in order to establish such a defence, must go further and show that the act was so grossly negligent as to indicate an intention to commit a fraud on the rights of the insurer… I am unable to see that an insane person can form a fraudulent or wrongful design in the destruction of his own property, so as to defeat a policy of insurance thereon, any more than I can see that he could form a criminal intent in the commission of crime"

In that case, the assured was insane at the time of the fire, which he had started, and his estate recovered from the company which had insured his property against the risk of fire.

20. In the case of Howie v CGU Insurance PLC [2005] Scot CS Csoh 110 (17 Aug 2005), a decision of the Outer House of the Court of Sessions, Lord Clarke cited with approval both the passage in MacGillivray referred to at paragraph 17 above, and the decision in D'Autremont. In Howie, the pursuer was claiming pursuant to an insurance policy in relation to damage caused by a fire which he had started. The fire had killed his mother. He was charged with murder and, at his criminal trial, the jury had returned a unanimous verdict of not guilty on the basis of his insanity at the material time. He was made subject to an order for his compulsory detention at a secure hospital.
21. In the insurance claim, the court concluded that the defendant insurers could not plead a defence based on an alleged breach of the condition to take all reasonable steps to prevent injury, loss or damage. The court also concluded that the insurers could not defeat the claim on the ground of public policy because the authorities made plain that, depending on the pursuer's state of mind, he was not necessarily debarred from recovering under the policy. Howie was not, however, a decision on the merits of the underlying claims.

B5. Summary

22. A claimant who seeks to recover pursuant to a policy of insurance in respect of a fire which he himself started is faced with the difficulty that his claim is contrary to public policy (Section B1 above) and/or contrary to general principles of insurance laws (Section B2 above). In this case, Mr Porter has the additional difficulty that the Zurich expressly excluded all claims based on his wilful and malicious acts (see Section B3 above).
23. Mr Porter is only able to circumvent all of those difficulties, and to recover in respect of the fire claim, if he is able to demonstrate that, on 27 March 2001, he did not know "the nature and quality of the act he was doing; or if he did know it, that he did not know that he was doing what was wrong." If Mr Porter is able to establish that, in accordance with this test, he was insane according to law, then he can recover; if he is able to show mental illness which falls short of this test, then the claim in respect of the fire damage must fail.
24. I note that, ultimately, there was no dispute between the parties as to these principles of law.

C. THE BACKGROUND TO THE FIRE

C1. 1996-1998

25. Mr Porter started work as a bricklayer and, during the 1980's, built up a successful company, called Porter Builders, which specialised in construction and property development. By the early 1990's the company employed 130 people with a further 200 indirectly engaged as sub-contractors. As Mr Porter rightly said to me in evidence, it was a very successful business and he was very proud of it.
26. Unfortunately, success brought with it its own pressures and, in 1995/1996, Mr Porter handed over control to a managing director, Mr Peter O'Brian. Other directors were also brought in. At the same time, Mr Porter found that his use of alcohol was becoming more and more a part of his life. He told me that he tried to contain it but it got the better of him. He also told me that, by this time, he believed that there was something wrong with him.
27. Mr Porter's drinking grew worse: he agreed that it was binge-drinking, which regularly involved 2 or 3 bottles of wine a day. His drinking led to violence. Mr Davis a friend for over forty years who gave evidence on his behalf at the trial, referred to drunken physical assaults by Mr Porter on both himself and Mrs Davis at around Christmas 1997. The assault was so serious that Mr Davis required hospital treatment.
28. In 1998, Mr Porter was invited to become involved in 'the New Deal' project, a scheme created by the new Labour Government, aimed at the young unemployed. During 1998, Mr Porter became increasingly involved with the project, appearing on television and going around the country giving speeches and describing how he had built up his business from scratch. There appears little doubt that the pressure of this work also began to take its toll on Mr Porter.
29. Things came to a head at Christmas 1998. Mr Porter was feeling increasingly depressed and he was prescribed anti-depressants. He stayed in bed for 3 or 4 months and drank heavily. He ceased working for Porter Builders altogether. I am in no doubt that, whilst from a medical point of view it was necessary for Mr Porter to relinquish his involvement with Porter Builders, his understandable pride in the company that bore his name meant that he found it difficult, if not impossible, to accept that other people were now running the business.

1999-2000

30. In February 1999, there was apparently a violent incident involving Mrs Porter in which she feared for her life. The incident is referred to in some of the contemporaneous medical notes. Again, the notes indicate that the violence or threatened violence was linked to Mr Porter's drinking. I also note that, sometime in the first half of 1999, Mr Porter was arrested for possession of an offensive weapon. There is a note from his doctor, Dr Neil, to a consultant psychiatrist, Dr Mahmood, dated 16 April 1999, which indicated that Mr Porter was "quite keen" on obtaining a psychiatric opinion, "as he feels [in the] impending court case [it] would help his cause, if a psychiatrist could confirm that he is of sound mind." Dr Mahmood became Mr Porter's psychiatrist.
31. By the middle of 1999, Porter Builders were suffering from acute cash flow problems. The auditors subsequently discovered a loss of around £500,000 in the accounts. As Mr Porter put it in his oral evidence, "the company died because of cash flow problems". Mr Porter remains convinced that the money was taken by the three directors/staff in particular who, he felt, had taken the company from him and stolen its money.
32. By September 1999, by his own admission, Mr Porter was drinking heavily. During that period, he said that he would kill one or more of the directors. He also assaulted his friend Mr Davis again.
33. In October 1999, Mr Porter endeavoured to commit suicide by hanging himself using a TV cable. He survived because the TV cable snapped. It appears from the medical notes that, on the same day, he threatened violence to his wife. Those same medical records noted that he was drunk at the time of these episodes.
34. Porter Builders never recovered from their financial difficulties in the middle of the year and, by December 1999, their bank, Allied Irish, had called in the receivers. The company ceased trading. I have no doubt that this was, entirely understandably, a bitter blow for Mr Porter. But worse was to follow. In January 2000, he made various threats of violence to the previous directors of Porter Builders, although they subsequently withdrew their allegations against him. Then, on 12 March 2000, ITV broadcast an episode of 'Tonight with Trevor McDonald' which investigated the demise of Porter Builders and was extremely critical of Mr Porter personally. Mr Porter did not take part in the programme. He had been sent a list of sample questions which suggested that the programme was unlikely to be balanced or fair^[3].
35. In March 2000, Mr Porter realised that he was going to have to sell the property in order to pay off the mortgage and to meet two personal guarantees, which were secured by way of a charge on the property. He was continuing to drink heavily. It appears that, almost immediately after he had realised his worsening financial situation, Mr Porter again made threats to the previous directors of Porter Builders. This time Mr Porter was arrested and held in police cells. He accepted in cross-examination that, because he was using drink as a prop, he became violent when he drank, and that both his suicide attempts and his threats to harm others had been made after heavy drinking sessions.
36. Mr Porter was released on bail, having been charged with threatening to kill, a serious criminal offence. In August 20000 he and his wife put the property on the market. Although the asking price was £450,000, they eventually accepted an offer of £260,000. On the figures, it appears that, once this sum had been received, and the mortgage and the guarantees had been paid off, Mr and Mrs Porter would have been left with nothing from the sale of their home.
37. It was at this point that Mr Porter decided to stop drinking. It appears that he took this decision at the end of September 2000. On 2 November 2000 he wrote to Dr Mahmood to inform him that he had finally taken his advice to stop drinking because "it was a negative force in my life". The letter went on to acknowledge that he was having to take anti-depressants again and was finding it difficult to come to terms "with the situation my family find itself in."

C2. January- March 2001

38. In the first few weeks of 2001, the arrangements were being put in hand for the sale of the property. The most pressing matter for Mr Porter was his forthcoming criminal trial, in March 2001, in relation to the charges rising out of his threats against the former directors of Porter Builders. It is beyond doubt that, at this point, Mr Porter was at a very low ebb. He had lost his business, and he was just about to lose his home. He had had his reputation attacked on national television and he was facing serious criminal charges.
39. I have read carefully through Mr Porter's diary for the first weeks of 2001. The entries demonstrate, in eloquent terms, the worsening depression and his view that Dr Mahmood could do no more for him. He began to contemplate suicide. The entry for 5 March is perhaps typical:

"The feeling of failure is overwhelming. It has come to the point [that] the house, the finances, the possible bankruptcy, is no longer of importance. I'm slowly but surely being stripped of my dignity and honour and my name. The humiliation is soul-destroying. I'm on the verge of finality, self-destruction, suicide. I've tried to cope. The support from my family has been unbelievable. It is personal and it is my problem. Whether I can survive will be on a daily basis. I need something to slow me up."

I should here repeat a point that I made during the closing submissions, when this passage was read out. In my view, Mr Porter was right to describe the support of his family as 'unbelievable'; his wife, in particular, has been a quite remarkable source of strength and support for her husband, and I cannot let her role in getting him through his worst moments, and in his subsequent rehabilitation, go unremarked.

40. On 21 March 2001, Mr Porter attended Liverpool Crown Court where he pleaded guilty to (lesser) harassment charges. The charges in respect of the threats to kill were dropped. The judge told him that "all options were open" when he adjourned the case for reports prior to sentencing; Mr Porter confirmed to me that he was well aware that this meant that he could be sent to prison. The sentencing hearing was fixed for 6 April. That is the background to the events of the 26/27 March 2001.

D. THE EVENTS OF 26/27 March 2001

D1. The Evidence Of What Happened

41. The only evidence of what happened immediately prior to and during the early stages of the fire comes from Mr Porter himself. He was alone in the property at the time. Although Mrs Porter, Mr Povey and Mr Davis were all able to corroborate events at the beginning and end of the relevant sequence, the critical matters could only be spoken to by Mr Porter himself.
42. In those circumstances, it is important to identify, where there are discrepancies or potential contradictions, the most reliable accounts of these events. Mr Porter has told this story on a number of occasions. What should be regarded as the most reliable account?
43. I consider that, in general terms, the more contemporaneous the account, the more reliable it is. Thus, the best evidence of what happened can be gleaned from the accounts which Mr Porter gave in the days and weeks after the fire. The significant accounts were:

a) The account that he gave to Dr Palmer when he was in Clatterbridge Hospital on 10 April 2001, which Dr Palmer then put into a report dated 19 April. This report was relied on by the Crown Court judge when sentencing Mr Porter on the harassment charges.

b) The detailed account that he gave, on 3 May 2001, to Mr Wylie from McLarens Toplis, the Zurich's appointed loss adjuster, and Mr Jones, the forensic scientist also appointed by the Zurich. Their notes were subsequently typed up into a draft statement which, following a number of revisions, were sent out to Mr Porter and which, subject to a further revision, he signed on 30 May 2001.

44. There were a series of statements produced for the trial from Mr and Mrs Porter, Mr Davis and Mr Povey. I consider that they are broadly consistent with the contemporaneous material that I have identified in paragraph 43 above. As I have indicated, to the extent that there are any inconsistencies, I prefer the contemporaneous records. I set out in Section D2 below a narrative of the relevant events, based on those contemporaneous records and, where appropriate, the subsequent witness statements and oral evidence in cross-examination.

D2. The Relevant Events

45. On Monday 26 March, a few days after his court appearance, and with the sentencing hearing fixed for 6 April, Mr Porter went for a long walk to West Kirby "feeling very low". In cross-examination he said: "I was lost in my own problems". He telephoned his wife and asked her to come and collect him in the car, which she did. As she drove back to the property, on two separate occasions, Mr Porter grabbed the steering wheel and tried to steer the car over to the other side of the road. At paragraph 23 of his witness statement he said:" I think I did that because I wanted to die."
46. It appears that, when he got home, Mr Porter asked his wife to go and get him some vodka. She refused because he had not been drinking for a while. He became aggressive and, according to Mrs Porter, "he had his hands around my throat and asked me if I wanted to die. I was frightened and said I could not put up with his behaviour. I then ran out of the house." It is clear that this happened before Mr Porter started drinking.
47. It appears that Mr Porter then brought himself some vodka from an off-licence and started drinking heavily, for the first time in several months. It is not clear what time, if at all, that he went to sleep. The following day, Tuesday 27 March 2001, Mr Porter stayed in bed all day and drank another ¾'s of a bottle of vodka. By the time he got up, it was dark and it appears to have been early evening.
48. During this 28 hour period, it seems that Mr Porter had consumed two bottles of vodka. That is the amount referred to in the medical notes. It does not appear that he ate anything. I also find, on the balance of probability that he had stopped taking the medication prescribed for him by Dr Mahmood. The evidence for that is paragraph 25 of Mr Porter's witness statement; he also admitted it in cross-examination. In addition, the fact that he had stopped taking his medication was referred to in the admission notes of 28 March when, after the fire, Mr Porter voluntarily admitted himself into Clatterbridge Hospital.
49. In the evening Mr Porter got up. Mrs Porter recalls a telephone call in which her husband "accused me of ruining the company and said some terrible things to me". This was not something that Mr Porter remembered, but I find that, on the balance of probabilities, Mrs Porter's recollection is to be believed.
50. Mr Porter's first act was to let the dog out. It appears that he told Dr Palmer that, by this time, he had decided to commit suicide by setting his house alight and that he fed his dog outside of the house "so that she would not be harmed by the fire". She records this in her report of 19 April (paragraph 43a) above). In oral evidence Mr Porter vehemently denied saying that to Dr Palmer, and said that he had simply let the dog out because she had not been out all day.
51. I find that, because it was included in her report, Mr Porter must have told Dr Palmer that he had let the dog out so that she would not be caught in the fire. She would not have invented this part of the story. Furthermore, as I noted during the cross-examination, the inclusion of this part of the story in Dr Palmer's report was not insignificant, given that this report was relied on by the judge at the sentencing hearing.
52. Mr Porter was then in the lounge. Mr Jones's notes, taken at the interview on 3 May 2001, explain what happened next:

"Newspaper - not a daily - picked out 2 or 3 pages and put in middle section of settee by piano. I decided I'd end my life. I snapped. Tried to kill myself before. But hadn't intended to that day.

Put paper on middle section. Took other part of newspaper and put under second curtain in dining area. Took another piece and put under another curtain. Might have set a third or might have moved paper under another curtain.

Certainly set fire to two curtains.

Then I went and sat in my chair – a chair that I hadn't sat in for a long time. That was the boss's chair where I would do business on the phone. Didn't feel that I could sit there but decided to on that day.

I was sitting looking at the fire creeping slowly (to me) up the curtains. Not sure if I blacked out of if I fell asleep. I came round – or woke up. Not a noise but something woke me. As I looked – the couch "exploded". From a fire of approximately 2 foot – like a bonfire – suddenly involved the whole couch – couldn't see piano behind. At same time curtains just caught - like fames travelling across ceiling. By then smoke – acrid – split in levels – higher thicker – a mist at chest level. Still sat down – not aware of heat."

53. In cross-examination, Mr Porter confirmed the accuracy of this account in all its important particulars. He said:

"I intended to die that day. I decided to die that day…I waited there [in the boss's chair] just to be consumed by fire. I intended to kill myself."

In cross-examination, Mr Porter accepted that it was obvious to him that the settee and the curtains were going to be damaged by the fire and that this was how he intended to kill himself: by burning the house down.

54. Mr Jones's notes continued:

"Something said to me: 'you don't need this – walk away'. I looked at it with contempt. Smoke thick. Was calm – no panic. Knew that door was on left hand side but couldn't see it. Reached for where I thought handle was – wasn't there. Didn't panic, moved hand down door and came upon handle. Pressed it down, opened door – closed it behind me. Calm – no panic."

Mr Porter was asked about his comment to Mr Jones in May 2001 that he had looked at the fire "with contempt". It was put to him on a number of occasions that, in using this word, he was attempting to convey that he was ashamed at what he had done. Eventually, Mr Porter accepted this. The relevant exchange was as follows:

"Q: You looked at it 'with contempt' because you were ashamed of what you had just done?

A: Yes, it could be construed that way.

Q: You were ashamed of what you done?

A: I wanted to die.

Q: You were ashamed?

A: Wouldn't anybody?

Q: You were ashamed of what you had just done?

A: Yes."

55. It appears that Mr Davis was alerted and drove over to the property. He found Mr Porter "walking aimlessly" and, at one point, being prevented from going back into the property. He said: "Ray did not say anything to me at this time, he was completely blank and seemed to be out of it. I am not sure he even recognised me."
56. At some point, Mr Porter left his own home and went to that of his neighbours, Mr Povey and Mrs Baker, where his wife and daughter were staying. It appears that either Mrs Porter or Mrs Baker (it does not matter which) said to Mr Porter: 'what a stupid thing to do'. Mr Porter's daughter Claire was understandably upset that the family home was on fire. In a reference to the former use of the property, and his lingering feelings towards Mr O'Brian, who was involved in a church, Mr Porter shouted 'Tell O'Brian the church is burning'.
57. On 28 March 2008, Mr Porter voluntarily admitted himself to Clatterbridge Hospital. He was seen there by a variety of medical staff including Dr Mukherjee, a locum psychiatrist. Dr Mukherjee became, and remains, Mr Porter's psychiatrist. Mr Porter remained at Clatterbridge until 10 April, when, as noted above, he was seen by Dr Palmer. He and his wife stayed briefly with their son until, in early May 2001, they found a house to rent.
58. It appears that the property was not habitable following the fire. A professional firm was engaged to board up the property and Mrs Porter told me that her son returned to the property to make sure that the boards were properly nailed over the rear doors.

E. THE MEDICAL EVIDENCE

E1 The Contemporaneous Records And Reports

59. Just as the contemporaneous records of Mr Porter's account of the fire are inherently more reliable than subsequent accounts, I consider that, in order to come to a conclusion about Mr Porter's state of mind at the time of the fire, the contemporaneous records and reports as to his mental state are more useful than subsequent records and reports. Of particular significance, so it seems to me, are the documents generated by Mr Porter's stay at Clatterbridge Hospital.
60. When Mr Porter was admitted on 28 March 2001 he was the subject of no less than three sets of clinical notes prepared on his admission. One set was produced by Dr Mukherjee. The second set was produced by another doctor, and the third set was produced by the relevant nurse and was called the "Initial Core Assessment".
61. Dr Mukherjee's notes recorded, amongst other things, some of Mr Porter's delusional beliefs about the former directors of Porter Builders. They do not contain any attempt at a diagnosis. The other set of admission notes are largely repetitive of the matters noted by Dr Mukherjee.
62. The Initial Core Assessment is the only one of the documents of 28 March 2001 that purports to include any sort of express psychological assessment. The assessment recorded that delusions, hallucinations and a depressed mood were not present, and that communication was not impaired due to a psychological state. The problems that were present were noted as 'other mood disturbance' and 'anxiety'. The notes expressly recorded Mr Porter's anxiety in relation to his impending court hearing.
63. During his first 72 hours at Clatterbridge, Mr Porter was the subject of constant monitoring. The monitoring records contain an ongoing 'behavioural and cognitive assessment'. The entries over this period include: "no obvious outward symtoms of depression"; "very friendly and cooperative. No overt symptoms of depression. He stated that he is feeling much more positive and optimistic since his arrival in hospital. No expression of delusion/bizarre thought"; "appears pleasant and polite, good eye contact and relaxed. No obvious signs of depression and has not mentioned or expressed self-harm"; "friendly and cooperative with staff".
64. On 3 April 2001, Dr Mukherjee wrote to Bell Lamb and Joynson ("BLJ") Mr Porter's solicitors acting for him in connection with his criminal case. Dr Mukherjee wrote:

"Thank you for your enquiry regarding the above named. Mr Porter was admitted under my care on an informal basis on 28 March 2001 for psychiatric assessment. I also understand that he entered a 'guilty' plea to an offence and the court hearing is on 6 April 2001. I fell that he will be fit to attend court and would understand the court proceedings and will be able to take advice from his solicitor."

In fact, for reasons which are unclear, the hearing was adjourned until 27 April 2001.

65. Mr Porter left Clatterbridge on 10 April, the day he saw Dr Palmer. Dr Mukherjee completed his 'Patient Discharge Summary' which recorded the reasons for Mr Porter's stay in hospital and noted: "No evidence of psychosis on the ward. No longer suicidal".
66. On 19 April 2001, Dr Palmer produced the report to which I have already referred in paragraph 43a) above. This was the detailed report produced for the purposes of the adjourned sentencing hearing. Her concluding opinion is important and should be set out in full:

"(1) Raymond Porter is not under 'disability in relation to his trial' (Criminal Procedure [Insanity and Unfitness to Plead] Act 1999)

(2) Despite Raymond Porter's delusional disorder, I do not believe that he is suffering from any mental disorder within the meaning of the Mental Health Act 1983 that would make compulsory admission to hospital appropriate at this stage.

(3) As far as I can ascertain, Raymond Porter had a traumatic childhood on account of his mother's desertion. He was also sexually assaulted at the age of 12 years. Both these incidents effectively predispose him to develop mental health problems in later life. I believe that Raymond Porter has suffered very genuine mental health problems since December 1998 causing him to behave irrationally and irresponsibly at time.

(4) I am of the opinion that the harassment charge and also the suicide bid both occurred as a consequence of his mental illness which directly influenced his behaviour, although he knew his actions were wrong. The defendant bitterly regrets behaving as he did, particularly the fact that others may have suffered as a consequence of his behaviour.

(5) Raymond Porter continues to have significant mental health problems. Doctor Mukherjee is in the process of formulating a comprehensive package of care and shares my view that Raymond Porter suffers from depression and a delusional disorder. We both are extremely concerned that the defendant presents a very genuine suicide risk. I would therefore respectfully suggest that the court take a more lenient view in relation to his offending. I would also suggest that the Insurance Company take a less than punitive stance in relation to his claim for damages to his property. I have no other medical recommendations to make as to disposal."

67. The other contemporaneous medical record to which reference was made during the trial followed Mr Porter's release form Clatterbridge. He was the subject of visits from the Community Mental Health Team in the West Wirral. He was visited by JC Francis-Ellis, a community psychiatric nurse. On 8 May 2001, she wrote:

"During my assessment Mr Porter did not display any symptoms of mental illness. He says that his sleep, appetite and concentration have returned and he is once again enjoying life. He no longer experiences any suicidal thoughts and is hopeful for his future. However, Mr Porter continues to be concerned with sorting out matters in relation to his collapsed business and this appears to cause his mood to dip at times."

E2. Professor Wilkinson' First Report

68. It appears that, although these proceeding were not commenced until 2007, Mr Porter had been to see his present solicitors by some time in 2004. They rightly realised that, for the claim to succeed, they needed assistance from an expert psychiatrist. They instructed Professor Wilkinson, who examined Mr Porter on 8 September 2004. Subsequently, it appears that Mr Porter's solicitors chose not to instruct Professor Wilkinson and he is now the expert psychiatrist giving evidence on behalf of the Zurich.
69. Professor Wilkinson's first report was dated 27 September 2004. Professor Wilkinson concluded that Mr Porter's psychiatric complaints were 'consistent with psychiatric disorder in the form of persistent delusional in partial remission, and a moderate depressive episode'. He identified the matters as noted in paragraphs 38-40 above as having "exacerbated Mr Porter's pre-existing psychiatric disorder and pattern of vulnerability to self-harm in the period immediately before the fire". He said at paragraph 17.18 that, "on the balance of probability in setting fire to his house Mr Porter would have acted in response to his psychiatric disorder".
70. Professor Wilkinson went on in the same paragraph to refer to Mr Porter's account to him that "he set fire to his house because he wanted to end his life and in response to God's command". Professor Wilkinson noted that this latter claim was not fully supported by the other documents and said that he had been unable to find support in the supplied materials for this belief. At paragraph 17.20 of his report he said:

"I recognise that although Mr Porter has pre-existing psychiatric disorder, he might possibly be malingering with financial motivation and that he acted wilfully or maliciously. On one hand, Mr Porter's current disclosure that God had told him to light the fire, if correct, in my view would strongly support the contention that he did not act wilfully or maliciously in setting fire to his house; on the other hand, making that disclosure at this stage inevitably provokes my suspicion that his disclosure is made for reasons of expediency."

E3 Dr Mukherjee's Reports

71. As noted above, Mr Porter's solicitors decided not to instruct Professor Wilkinson as their expert and reverted to Dr Mukherjee, Mr Porter's existing psychiatrist. Doctor Mukherjee's first report was dated 23 October 2006. This short report concluded:

"Considering the events leading up to the fire, including his state of mind, delusional beliefs, suicidal ideation and the effects of alcohol, I sincerely believe Mr Porter's thoughts and judgement were grossly impaired and he was not acting as a free agent. I also believe his action was directly related to his mental illness and a consequence of the other factors mentioned above."

72. On 2 April 2007, Dr Mukherjee produced what was referred to as a 'psychiatric report made to the court' in conjunction with Dr Palmer, who had subsequently married and was now Dr Proctor. The precise purpose of the report is unclear and Dr Proctor has not given evidence at the trial. The report repeats the paragraph from Dr Mukherjee's report referred to above. It also expresses the view that "we believe wholeheartedly this is a genuine claim against the home insurance policy". Contrary to Mr Sterling's submission, I do not read this joint report as setting out a 'completely different opinion' to that set out in the report of 19 April; indeed, as Dr Mukherjee confirmed in cross-examination, there was nothing to indicate that Dr Proctor ever altered the important opinions set out in the earlier report.
73. Dr Mukherjee's second report for the purposes of these proceedings was dated 20 March 2008. This report (again very short) referred to Dr Mukherjee's view, shared with Dr Proctor, that Mr Porter suffered from 'persistent delusional disorder along with co-morbid moderate depressive episode'. The views identified in paragraph 71 above are repeated.

E4. Professor Wilkinson's Second Report

74. Professor Wilkinson's second report is dated 22 January 2009. This is a long report which, although it repeats much of the first report, also contains a number of elements which are entirely new. It was based on a further examination of Mr Porter on 15 October 2008, which examination included a number of important exchanges, as recorded by Professor Wilkinson. First, it appears that, even though he had made no mention of it to Dr Mukherjee, or indeed to anybody else, Mr Porter again said to Professor Wilkinson that he had heard God's command during the fire. Furthermore, Mr Porter agreed with Professor Wilkinson that he knew what he was doing when lighting the paper and that he was trying to kill himself. When Professor Wilkinson asked what Mr Porter was doing was right, he replied 'at the time yes, it was right for me'. Mr Porter apparently went on to say that it was not wrong because he wanted to commit suicide but that 'if it ever happens again, in front of a train, clear-cut, nobody gets hurt'.
75. Based on these exchanges, Professor Wilkinson said, at paragraph 15.67 of his second report:

"Mr Porter, on the balance of probability, from a psychiatric point of view, would have known that his action was 'wrong' when he set fire to his own property. I would point out that Dr Palmer reported in April 2001, in relation to the harassment charge and also the suicide bid- 'he knew his actions were wrong'".

E5. The First Joint Statement

76. The first joint statement signed by Dr Mukherjee and Professor Wilkinson was less than helpful, since it consisted of less than half a page. Other than their respective reports, the only thing that the two men agreed was that "it would be very difficult to explain on a psychiatric basis why Mr Porter reported hearing a command from God solely to Professor Wilkinson". As to the matters on which they disagreed those were recorded in terse terms:

"Doctor Mukherjee believes that due to the whole of Mr Porter's state of mind eg delusional beliefs, alcohol and thoughts; he was not responsible for what he was doing.

Professor Wilkinson believes that Mr Porter would have been responsible for his actions and would have had the mental capacity at the time of the incident on 27 March 2001 to know what he was doing and/or to know what he was doing was wrong in setting a fire, whether or not to kill himself".

E6. The Second Joint Statement

77. The second joint statement produced during the trial was much more helpful. That noted that Dr Mukherjee and Professor Wilkinson agreed "that Mr Porter had pre-existing persisting delusional disorder is association with a depressive episode." They also broadly agreed as to the cause, course, outcome and treatment of persistent delusional disorder and/or depressive episode. In addition, they agreed that Mr Porter would have been in a disturbed state of mind leading up to the fire. Finally, by reference to Doctor Mukherjee's report, they agreed that "free agent" was not a medical term. It was recorded that Dr Mukherjee meant that term to mean that Mr Porter was not in control of his actions, whilst Professor Wilkins believes that the term has no medical meaning.
78. Dr Mukherjee and Professor Wilkinson disagreed as to whether Mr Porter had pre-existing vulnerability to alcohol-related psychiatric disorder. In addition the experts disagreed that Mr Porter's actions showed that he knew what he was doing in lighting the fire and disagreed that he would have known that his actions in lighting the fire were wrong.

F. ANALYSIS AND CONCLUSIONS IN RESPECT OF THE FIRE CLAIM

F1. Overview

79. As noted in paragraph 23 above, Mr Porter has to demonstrate, on the balance of probabilities that, when he set fire to the property on the evening of 27 March 2001, his mental state was so impaired that he did not know the nature and quality of the act he was doing or, if he did know it, he did not know that what he was doing was wrong. That is the test for insanity used in the criminal law, in order to see whether somebody is not guilty of the crime with which they are charged by reason of insanity.
80. This is, as I have said, a difficult test to satisfy; it is much more onerous than simply demonstrating that Mr Porter had a mental disorder at the time of the fire. I am not persuaded that the nature and extent of the relevant test – the test of insanity in law – has been fully appreciated by those advising Mr Porter. This has had the consequence that, as explained below, only Professor Wilkinson has asked himself the right questions in order to form a view on this critical issue.
81. I am confident that, on any fair view of the material set out in Sections C, D and E above, Mr Porter has not satisfied the necessary test of insanity identified at paragraph 23 above. It is impossible to say that Mr Porter's state of mind was such that he did not know what he was doing when he set the fire and/or that he did not know that, in setting the fire, what he was doing was wrong. On the contrary, I consider that the evidence makes plain beyond any doubt that Mr Porter knew precisely what he was doing and that he knew that what he was doing was wrong.
82. I set out in the remaining part of this Section F the particular matters within the evidence which have led me to this conclusion. However, I should stress that this view is based on the entirety of the evidence contained in those documents which I have been shown, and the oral evidence which I heard at the trial. The matters noted below are simply those which I regard to be of particular significance.

F2. The Factual Matters

83. First, I consider that on the evening of 27 March 2001, Mr Porter intended to kill himself. That was his clear intention as he expressed it to me orally during cross-examination, and as he has expressed it to a number of psychiatrists and others over the years since the fire. He was capable of forming that intention and he was capable of carrying it out.
84. Secondly, it is clear that he was in control of himself and his actions. This manifested itself in a number of different ways. I have already dealt, at paragraph 50, with my reason for concluding that he let his dog out so as to ensure that she was not caught in the fire. That is what he told Dr Palmer. That was a rational and sane action.
85. More importantly, Mr Porter set the fire in a clear and deliberate way, using the newspaper to set fire to the settee and placing it under the curtains in order that, once the paper was alight, the fabric of the settee and the curtains would immediately catch fire too. Dr Mukherjee accepted in cross examination that these were very specific actions over which Mr Porter had control. Whilst Dr Mukherjee did say that it was very difficult to know what was in Mr Porter's mind, he did accept that the physical actions (in particular the placing of the paper in the relevant places and the setting fire to that paper) were deliberate acts. That again, is only consistent with somebody who knows what they are doing.
86. Thirdly, there is the question of whether Mr Porter knew whether what he was doing was wrong. The factual evidence is plain: he did. I have set out at paragraph 54 above the exchanges on that topic. Mr Porter admitted that he was ashamed at what he had done and why he left the burning house. Somebody is ashamed of something that they have said and done because they know that it was wrong. When that proposition was put to Dr Mukherjee, he could not gainsay it: 'perhaps' was the word that he used to indicate that he could not disagree with it.
87. Accordingly, the evidence on the two limbs of the M'Naghten test was overwhelming: Mr Porter knew what he was doing when he started this fire because he intended to kill himself. He took clear and deliberate action in order to bring that result about. Part way through the process, as the fire took hold, he changed his mind. He was ashamed of what he had done. That is because he knew that it was wrong. For those reasons therefore, upon the factual evidence, the necessary test of insanity has manifestly not been made out.
88. Mr Sterling, on behalf of Mr Porter, did not seriously challenge this analysis. Instead, he endeavoured to circumvent the effect of this evidence by arguing that the only thing that mattered at the time of the fire was Mr Porter's delusional state of mind. In support of this case, and despite the fact that these points had not been advanced by Dr Mukherjee and were not all put to Professor Wilkinson, he relied on: i) the evidence of Mrs Porter as to the call on 26 March (paragraph 49 above); ii) Mr Porter's use of the word 'snapped' as indicating an impulsive act (paragraph 52 above); iii) the evidence of Mr Davis as to Mr Porter's numbed state after the fire (paragraph 55 above); and iv) Mr Porter's comment about the burning church (paragraph 56 above).
89. I accept that i) and iv) are proof that his delusions were an element of Mr Porter's state of mind at the time of the fire, but nobody is suggesting to the contrary. The use of the word 'snapped' is common in descriptions of this sort of extraordinary event, and is not, of itself, indicative of insanity: after all, as Professor Wilkinson explained, 100,000 people a year in the UK attempt suicide in one way or another, and for almost all of them it is an impulsive decision. Furthermore, I do not doubt that iii) is largely explicable as shock; Mr Porter had, after all, just burned down his own house. None of this evidence should or can alter my conclusion at paragraph 87 above.

F3. Reasons For The Fire

90. The suggestion that Mr Porter's mental illness was the only cause of the fire was part of a wider debate about the reasons for Mr Porter's actions on the evening of 27 March. I am bound to say that, in the main, I found this debate unhelpful, both because it seemed to me fairly obvious what the factors were that had given rise to the events of 27 March, and because both experts were generally agreed about those factors.
91. There were essentially three ingredients that led Mr Porter to do what he did. The first was his delusional disorder. He was suffering from a persistent delusional disorder which had thus far had not been effectively treated. In short, Mr Porter was mentally ill, and some signs of his disorder were apparent on 26 and 27 March. But that, on its own, does not explain this chain of events, nor was the contrary suggested by Dr Mukherjee. In particular, there was no evidence to demonstrate that, in actually setting the fire, Mr Porter was acting in response to his delusions.
92. In my judgment, there were two other factors that were in play on 26/27 March. First, there were the series of shattering life events which I have endeavoured to summarise in paragraphs 38-40 above. Even the strongest person would have been brought low by the sequence of events which shattered Mr Porter's life between 1996 and 2001. Not only had he lost everything but, by the time of the fire, he faced the distinct possibility of imprisonment.
93. And there was a third factor: alcohol (and the related decision to stop taking his prescribed medication). Whilst I consider that the Zurich's case in relation to alcohol has perhaps been over-stated, I also consider that Dr Mukherjee was wrong repeatedly to deny in cross-examination that alcohol abuse was not a factor in the starting of the fire, not least because his own reports had expressly identified Mr Porter's drinking as one of the factors in the relevant chain of events. It seems to me that, on the evidence that I heard, Mr Porter had a serious alcohol problem by September 2000 and that on all the evidence, but particularly that of Mr Davis, his drinking was, over the lengthy period in question, giving rise to verbal threats, physical assaults, and one attempted suicide. As Dr Mukherjee properly accepted, in the end, the evidence showed a clear pattern in which Mr Porter's drinking was linked to violence and self-harm, and that alcohol was "a factor" in the events of 26/27 March 2001.
94. It cannot be a coincidence that, despite the disastrous life events that had occurred to Mr Porter by the autumn of 2000, and despite the worry and anxiety caused by his impending court case, his decision to give up alcohol in late September 2000 had resulted in a period of relative calm. As the depressive episode took hold in March, the strains on Mr Porter grew worse and, on 26 March, he went back to drinking. I accept that he had attempted to grab the wheel of the car, and put his hands around his wife's throat, earlier on 26 March when he had not started drinking, but that does not mean that the loss of inhibition caused by the two bottles of vodka was not a significant factor in the setting of the fire. Dr Mukherjee agreed that it was. I consider that alcohol was therefore the third ingredient which gave rise to the fire.
95. Accordingly, I conclude that the fire arose as a result of three separate factors (the delusional disorder, the life events, and the alcohol), all of which were required in order to give rise to the fire-setting. Mr Porter's mental state was only one part of that causative thread. Again, in my judgement, Mr Porter's delusional disorder was not, on its own, sufficiently causative to meet the test of insanity set out in paragraph 23 above.

F4. The Contemporary Medical Evidence.

96. I consider that the contemporaneous medical evidence is important for the reasons outlined in paragraph 59 above. In my judgement, any fair consideration of the contemporaneous medical evidence demonstrates that Mr Porter was not suffering from such an abnormality of mind that the test of insanity could be satisfied. I recognise of course, that a record of his mental state even a few days later is not necessarily an accurate guide to his state of mind on 27 March. On the other hand, I consider that it is, other than the factual evidence of what happened on 26/27 March 2001, the best evidence available.
97. I have set out, in paragraphs 60-67 above, the relevant extracts from the contemporaneous medical reports and records which I consider to be of significance. It is unnecessary to repeat them all here. In short, I consider that those reports and records are entirely inconsistent with Mr Porter's case now that he was so mentally ill that he did not know what he was doing and/or that what he was doing was wrong.
98. Of particular significance, so it seems to me, are i) the letter from Dr Mukherjee of 3 April 2001 (paragraph 64 above); ii) his discharge summary of 10 April (paragraph 65 above); and iii) the report from Dr Palmer of 19 April 2001 (paragraph 66 above). The first and last of these documents were produced for the ongoing criminal proceedings: they were intended to be read and relied on by the Crown Court judge who was to sentence Mr Porter. Those documents make plain that, within a few days of the fire, it was not thought that Mr Porter was under a "disability in relation to his trial"; that he was fit to attend court, instruct his barrister and so on. The documents also say that, despite Mr Porter's delusional disorder, it was not thought that this was sufficient to require compulsory admission to hospital under the Mental Health Act 1983.
99. In short, the reports from Dr Mukherjee and Dr Palmer were saying that, although Mr Porter was mentally ill, the illness was not so grave that he was unfit to be sentenced, nor did he require compulsory detention in hospital. That is another contemporaneous indication – a strong one – that at the time of the fire, Mr Porter's mental state was not sufficiently grave to justify the conclusion that he did not know what he was doing. And that conclusion is confirmed by the discharge summary which is, I think, quite contrary to any suggestion that Mr Porter was insane at the time of the fire; indeed, it says the very opposite.
100. It is also extremely important to note that Dr Palmer expressly recorded in her report that, although Mr Porter's actions were the consequence of his mental illness, "he knew is actions were wrong". Despite Mr Sterling's valiant submissions to the contrary, I am in no doubt that she was talking about both the threatening calls and the fire: the report cannot sensibly be read in any other way. That is an important contemporaneous judgement. It is the only occasion in March/April 2001 when a doctor indicated his or her view on that vital question. As Dr Mukherjee confirmed in cross examination, no subsequent report from Dr Palmer sought to modify or alter that conclusion. Of course, Dr Palmer's view is quite contrary to the case which Mr Porter now seeks to advance.
101. Although perhaps of less significance, I do also consider that the monitoring and other records produced as a consequence of Mr Porter's stay at Clatterbridge Hospital are also inconsistent with him suffering from a grave mental illness of the kind which could lead me to conclude that he was insane when he set the fire. As I have already indicated, I understand that these records need to be treated with some caution because, as Dr Mukherjee said, it is not always easy to diagnose, from the outward appearance of a patient with a delusional disorder, the state of his or her mind. But the records, summarised at paragraph 63 above, do demonstrate a relatively upbeat picture which, in my judgement, is more consistent with the passing of a particular depressive episode (26-27 March 2001) than with someone who was insane just a few days earlier.
102. I therefore accept Professor Wilkinson's evidence that these records are inconsistent with somebody who was so mentally ill just a few days before that they met the legal test of insanity set out above. Specifically, Professor Wilkinson said, at paragraph 15.75 of his second report, that "I would not have expected a typical uncontrolled acute depressive and/or delusional illness to settle as quickly as did Mr Porter." And in cross-examination he put it in this way: "I would not have expected it to settle so quickly [if his disorder had been active]. I would have expected a very different Mr Porter on the ward: hostile, suspicious." For the reasons noted above, I accept that evidence.

F5. The Differences Between Professor Wilkinson And Dr Mukherjee

103. There were clear differences of approach between Professor Wilkinson and Doctor Mukherjee. Where their views diverged, I am bound to say that I generally preferred the evidence of Professor Wilkinson. There were a variety of reasons for that:

a) Professor Wilkinson was the independent expert that Mr Porter saw first. Originally it was thought that Professor Wilkinson would be his expert. That gives Professor Wilkinson's views a particular significance.

b) I consider that Dr Mukherjee has been inhibited by the fact that he was and is Mr Porter's treating psychiatrist. I say at once that I am in no doubt that Dr Mukherjee gave his evidence clearly and truthfully, and the relationship of trust between him and Mr Porter was plain for all to see^[4]. But I consider that, particularly given the importance of trust in the relationship between psychiatrist and patient (as explained in the textbooks that were referred to during the hearing), I consider that Dr Mukherjee will not have been able to approach a consideration of Mr Porter's mental condition at the time of the fire in an entirely uninhibited or independent way.

c) In addition, as previously noted, I consider that Professor Wilkinson's reports contain a more detailed analysis of the relevant issues. Professor Wilkinson has asked himself the right questions, in particular whether or not Mr Porter knew what he was doing on the night of the fire and, if so, whether he knew what he was doing was wrong. Those questions are not addressed at all in Dr Mukherjee's reports, so that the first time he addressed them was in cross-examination. Moreover, his use of the expression "free agent", which the experts agree is not a medical term, was not very helpful.

104. All that said, I consider that there was, in truth, little between the two experts. That is because on the two key issues - whether or not Mr Porter knew what he was doing when he set the fire and whether or not he knew that it was wrong – Dr Mukherjee accepted the Zurich's case during his cross-examination. He accepted that, in relation to the physical actions of setting the fire, Mr Porter knew what he was doing. And not only did Mr Porter agree that he was ashamed of what he had done but, when that point was put to Dr Mukherjee, he saw the force of it (see paragraph 86 above).
105. For those reasons, therefore, although I prefer the evidence of Professor Wilkinson, it is my view that, ultimately, both consultant psychiatrists were saying the same thing and that, notwithstanding Mr Porter's delusional disorder, it could not be said that he did not know what he was doing and it could not be said that he did not know what he was doing was wrong. On the basis of that evidence, the relevant test has not been satisfied.

F6. God's Command

106. Much was made by the Zurich of Mr Porter's statement to Professor Wilkinson that, during the incident, he heard God's command in his head. They pointed out that this alleged event was not something which Mr Porter had ever mentioned to anyone else, and had certainly never suggested it to Dr Mukherjee. The experts are agreed that it would be very difficult to explain on a psychiatric basis why Mr Porter had only told Professor Wilkinson of this. The inference, said the Zurich, was clear: Mr Porter had made this up and passed it on to Professor Wilkinson when he thought Professor Wilkinson was going to be his expert in order to bolster his case.
107. It is I think too simplistic to say that Mr Porter simply invented this part of the story to bolster his case and I am anxious to ensure that this aspect of the evidence is not exaggerated. On the other hand, I accept the proposition that Mr Porter was aware of the potential importance of psychiatric evidence in court cases generally (see paragraph 30 above) and that, if Mr Porter had heard this voice, he would have told Dr Mukherjee or Dr Palmer either during his stay at the Clatterbridge or shortly thereafter.
108. Accordingly, I conclude that this aspect of Mr Porter's account must be regarded as a generally unsatisfactory feature of his evidence, and lessens still further the credibility of the case which he now wishes to pursue.

F7. Summary

109. For the reasons set out above, I have concluded that, notwithstanding his delusional disorder, Mr Porter knew what he was doing when he set the fire at his property on 27 March 2001, and that, what is more, he knew that what he was doing was wrong. In those circumstances, the test of insanity by reference to the M'Naghton rules has not been made out. Public policy and the general law of insurance must mean that, in such circumstances, Mr Porter is unable is to recover under his policy of insurance. More specifically, the evidence demonstrates beyond any doubt that Mr Porter acted wilfully and maliciously when setting the fire and that, in such circumstances, General Exclusion Clause 1 must also apply so as to exclude his claim. For all those reasons, the fire claim must fail.

G. THE THEFT CLAIMS

G1. Theft 1

110. As noted above, McLaren Toplis were appointed by the Zurich as the loss adjusters in respect of the fire. The Porters made their formal fire claim on 9 April 2001. The claim form enclosed a full inventory of the contents which, it was said, had either been completely destroyed by the fire or severely damaged by smoke. It was in the context of this claim, of course, that Mr Porter met Mr Wylie and Mr Jones on 3 May 2001 and which led ultimately to the production of Mr Porter's first signed statement on 30 May 2001 (paragraph 43b) above). It was also clear that at this time BLJ were acting on behalf of Mr and Mrs Porter, in connection with the ongoing criminal proceedings, the fire claim, and the proposed sale of the property.
111. On 24/25 May 2001, when the Porters were living in temporary accommodation, the front entrance wrought-iron gates of the property were stolen (Theft 1). Mrs Porter explained to me that those gates had been padlocked together but had been taken off their hinges. She reported the theft to Mr Giles of McLaren Toplis and also to the police. A formal claim was made to the Zurich in a claim document dated 19 June 2001.

G2. Theft 2

112. Although the Porters were not living at the property, and it had been boarded up, it still contained numerous items of furniture, and household goods like computers and so on. Mrs Porter had indicated to Mr Giles that she intended to put in a portable trap system with sensors to deter burglars but, she told me, such a system was not in fact installed. She had also indicated in the same letter that, although they intended to remove their possessions, Mr Porter was "in no fit state" to remove them. It is important to note that the Zurich do not now allege that there was any failure by the Porters to take proper steps in relation to safeguarding these items, in breach of Condition 6 of the policy.
113. Sadly, the uninhabited property was burgled again on about 4 June 2001 (Theft 2). A formal claim was made to the Zurich on 21 June 2001. Again, the claim contained an inventory of items allegedly stolen.
114. The list of items in respect of Theft 2 included a number of items which had been included in the fire damage claim. This of itself is understandable: Mr and Mrs Porter were making these claims themselves and, by this stage, the fire claim had been refused (although they were seeking to have that decision reviewed). Out of an abundance of caution, if nothing else, it was appropriate for them to make this claim which included items that had already been claimed in the fire claim. As we shall see, the difficulties were to arise later because, at some stage, the question of duplication had to be sorted out, and that has still not happened.
115. On 6 July 2001, Mr Giles wrote to BLJ in relation to the claims for Thefts 1 and 2 and asked them whether BLJ had any objection to McLarens Toplis, now called Capita, from contacting the Porters direct or whether they would prefer all approaches to come through BLJ. Mr Giles noted that a site visit would be necessary as well as further enquiries regarding the stolen items, and an additional statement would be required by Mr Porter. Mr Giles explained that, where solicitors were acting, it was his usual practice to ask them whether they would prefer the contact to be through them or whether he could deal direct with the clients. That seems to me to be entirely reasonable and appropriate. Unhappily, there was no answer to this letter.

G4. Theft 3

116. On 17 July 2001, there was a third burglary on the property (Theft 3). Again, various items were stolen. This included the whole of the fitted kitchen said to be worth £14,000. A third claim was made to Zurich on 24 July 2001.
117. On 25 July 2001, Capita wrote again to BLJ noting that Mr Porter had spoken to the Zurich directly, asking for a note of the present position with his claims. Mr Giles again said that he was reluctant to contact Mr Porter "unless you can confirm that you have no objections to us doing so". Again there was no reply to this letter.
118. On 6 August 2001, Mr Porter wrote to Zurich complaining that there appeared to be no progress on the theft claims. On 10 August Capita wrote again to BLJ, again seeking their instructions and saying that "we can only assume that if we do not receive your advices within the next 7 days then you have no objections to us contacting your client directly". Again there was no reply to that letter.
119. On 29 August 2001, Capita wrote to Mr and Mrs Porter and said:

"As advised, you are represented by solicitors and I should normally carry out all communications with you via them. However, I have written to them on four separate occasions regarding the theft claims you are making and have also telephoned them asking them to respond but I have had no reply whatsoever. Enclosed are copies of the letters.

Please consider the position and let me know how you wish to proceed."

G4. Events Thereafter

120. Mr and Mrs Porter did not respond to this letter although it is not suggested that it had not been sent or that they did not see it. As a consequence, there was no investigation into any of the theft claims; there was no meeting with the loss adjusters; no statements were taken; and no collation of any of the documents that might assist with either the thefts or the value of the items stolen.
121. In September 2001, Mr and Mrs Porter surrendered the property to the mortgagees and the property was sold onto a third party.
122. On 12 November 2001 Mr Giles of Capita wrote again to BLJ pointing out that he had had no response from either BLJ or from Mr Porter regarding the arrangements necessary to enable enquiries to be made into the three theft claims. He went on :

"As advised in our earlier correspondence, we do need facilities to visit the scene and make appropriate enquiries with your clients and obtain statements from them and any witnesses.

Insurers are concerned at the delay and have indicated that unless a substantive response is received within the next 14 days, they will file their papers."

On 19 December 2001, a similar letter was written by Mr Giles to Mr Sale at BLJ pointing out that:

"…it is a concern that any delay may have prejudiced Insurer's position in relation to making such enquiries. We still need to visit the premises to determine how access was gained to the property and to see where the stolen items were removed from. We also need to discuss the incidents with your Client. Perhaps you could let us have your proposals for such a meeting".

In fact, by this time, Mr and Mrs Porter were no longer the owners of the property.

123. No further action occurred in relation to the theft claims. It appears that, sometime in 2002, the Zurich closed their file. The next thing that happened was in March 2007, when these proceedings were commenced. They had not been preceded by the pre-action protocol process, or even a letter before action, so there had been no warning that this claim was being revived after so long. The claim form was issued a few days before the expiry of the limitation period.

H. ISSUES IN RESPECT OF THE THEFT CLAIMS.

124. General Condition 3 provided as follows:

"On the happening of any event giving rise to a claim under the Policy, you must

a) advise us in writing as soon as reasonably possible

b) advise the police as soon as possible if the loss or damage appears to have been caused by theft, malicious acts, or civil commotion

c) not admit liability

d) forward to us unanswered and without delay all correspondence and legal documents (for example solicitor's letter, writ or summons) you receive

e) co-operate with us and not abandon any property to us

f) provide us, at your expense, with all information and evidence as may be reasonably required."

125. It is the Zurich's case that Mr and Mrs Porter did not comply with this contractual condition. In particular, it is said that they failed to cooperate because, despite repeated requests, they did not arrange for or attend a meeting with the Zurich's representative and they did not allow an inspection of the property. In addition, they did not provide statements or any other documents in relation to the thefts.
126. Accordingly, I have to decide whether, on the facts set out above, Mr and Mrs Porter were in breach of the terms of the insurance policy. If they were, it is the Zurich's case that they are entitled to damages in consequence of that breach, and they maintain that the measure of their loss would be any sums that would otherwise be payable to Mr and Mrs Porter. In other words, they rely on the breach as giving rise to a set-off or counterclaim for the sums otherwise due, so that the breach effectively becomes a complete defence to Mr Porter's claims.
127. It is important to note that Mr Crowley does not contend that Condition 3 was some sort of condition precedent to the right to make a claim. I consider that, as a matter of construction of the policy, this concession is rightly made. Thus the Zurich's only remedy is that afforded by the general law, namely, in this instance, damages for breach of contract: see MacGillivray, paragraph 10-013.

I. BREACH AND CAUSATION

I1. Was Mr Porter In Breach?

128. I consider that, on the facts noted above, Mr Porter was in breach of Condition 3 of the policy. Mr Giles, the loss adjuster, made repeated efforts to put in hand the sorts of investigations which are normal in these cases. He wrote repeatedly trying to set up meetings and the like. His letters were never answered. In my judgment, there was an obvious failure to provide even the most basic co-operation.
129. I accept, of course, that this lack of co-operation was unintentional. In addition, many of the letters and requests from Mr Giles were made to BLJ, who apparently ignored them completely. But as a matter of law, BLJ were Mr Porter's agents, and he was therefore legally responsible for their failures. Moreover, as the letter of 29 August (paragraph 119 above) made plain, Mr Giles did make an effort to deal directly with Mr Porter himself. That letter went unanswered and there was no explanation for that failure to respond.
130. It is very difficult for insurers and loss adjusters to consider claims promptly, unless they can meet the claimant to inspect the property, carry out the necessary investigations and consider all the paperwork. None of that happened here. It has meant that an insurance claim that has never been considered by the Zurich on its merits, because of these defaults, has now been pleaded in a High Court action. I consider that this unsatisfactory state of affairs has arisen because of the failures of Mr Porter and BLJ. The next question is: what was the consequence of that breach?

I2. Causation

131. The Zurich accept that the three thefts took place. Their concern is the absence of investigations at the time of those thefts. Mr Kershaw, the claims manager at the Zurich, sets out the Zurich's case as to causation in these terms:

"5. Had Zurich been able to investigate the theft claims at the time, we would have wanted to consider a number of issues but principally:

5.1 Whether the property had been adequately secured following the fire

5.2 The apparent duplication between the items claimed as part of the fire claim and the items claimed again as part of the second and third theft claims. It is apparent if you cross reference the schedule of items stolen in the second and third theft claims that with the inventory of destroyed/damaged items claimed in the fire claim most items appear to be duplicated. If the items had been so damaged in the fire claim that they were worthless then Mr Porter would not have suffered any loss if they were subsequently stolen.

5.3 To establish whether any items were not duplicated in the fire claim were in fact damaged by the fire.

5.4 To establish whether the items stolen did in fact have any value. We would have wanted to establish the location of the stolen items in the property to see what fire damage they were likely to have suffered,

5.5 We would have requested any evidence of the value of the items which would have included receipts but also evidence from Mr and Mrs Porter."

132. Save for the point about adequately securing the property (which, as noted above, is not pursued) this passage represents the Zurich's case on causation as a result of the breach of Condition 3. I accept this element of Mr Kershaw's evidence, although, as will become apparent below, I consider it to be so generalised as to be of little real assistance on the issue of liability before me.
133. The three theft claims gave rise to an unusual situation, because the inclusion of a large number of items in the claim inventory in respect of smoke and fire-damaged contents meant that, if items were subsequently stolen from the property, questions of duplication would become critical. If an item had been seriously damaged by the fire then, if it was subsequently stolen, there could be no claim, unless it could be shown that the item in question had been damaged but still had some kind of residual value after the fire, and at the time that it was stolen. The absence of any investigation into this aspect of the claims at the time may have hampered the Zurich's case.
134. I should also say that, although it is apparent that there is major duplication between the fire claim and the claim in respect of Theft 2, that duplication is nowhere expressly acknowledged in any of the pleadings produced by their current solicitors on behalf of Mr and Mrs Porter. I find that omission surprising. It appears that some duplication is tacitly accepted, because some items claimed as a result of Theft 2 have been reduced to a zero value in the schedules attached to the Answers to the Request for Information, but considerably greater clarity and effort on this part of the case was obviously required, particularly as there are numerous items in the Theft 2 claim list, and possibly some in the Theft 3 claim list as well, which are included in the fire claim, but which have not been indicated, even tacitly, as duplications. This is precisely the sort of overlap which the loss adjusters in the Zurich are entitled to explore and in respect of which the Porters' existing solicitors should have been much more helpful.
135. However, on causation, the real question is this: on the assumption that paragraph 5 of Mr Porter's second statement is correct, does it follow that, as a result of the breaches referred to above, Zurich's claim for damages in relation to the breach must be the equivalent of the sums they would otherwise have had to pay out in respect of the thefts? Put another way, do Mr Porter's breaches prevent him, as a matter of principle, from recovering anything at all in relation to the three thefts? In my judgment, the answer to these questions is No. It is at this final stage that I part company from the Zurich's stated position. My reasons are as follows.
136. In order to demonstrate that the breach gives rise to an equivalent claim for damages, the Zurich would have to show that, on the balance of probabilities, the investigations that they would – but for the breaches – have carried out in 2001 would have demonstrated that the theft claims should be rejected, and that any claims which might otherwise be sustainable now, 8 years later, only get off the ground because of the absence of proper investigations at the time: in other words, that the breach is causative of that loss. Alternatively, the Zurich would have to show that the claims are, now, impossible to investigate at all. Each of these alternative defences may be sustainable, either in whole or in part, but they require specific evidence: a key witness who has subsequently died; the existence of documents which could determine the validity or otherwise of the claims which have been destroyed because of the passage of time. There is currently no such specific evidence.
137. In my judgment, the mere absence of contemporaneous investigations – which is the highest that Mr Kershaw can put it - does not automatically give rise to a loss on the part of the Zurich, let alone a loss which is the equivalent of any sum otherwise due to Mr Porter. What matters is what those investigations would have revealed, and how and why any investigations now may not lead to the same result, or may simply prove impossible to make in any meaningful way. That will depend on specific, not general, evidence.
138. Mr Kershaw expressly refers to the possible duplication between the fire claim and the claim, say, for Theft 2. But that duplication is apparent from the documents available to everyone, as he acknowledges. In my view, that issue was, and remains, something which can be investigated. The passage of time, very regrettable as it is, does not act as an automatic bar to recovery, and the Zurich have not satisfied me on the general evidence that their position is now radically worse than it was in 2001.
139. Theft 1 is perhaps a good example of the causation issue. Although there was a breach of contract, I do not see, on the evidence before me, why or how the consequences of that breach mean that there can be no claim now. There was never any suggestion that the gates had been damaged in the fire. That was a straightforward theft and, during any subsequent investigation, Mr and Mrs Porter would have been able to add very little to the information in the claim form, because they were not living at the property at the time. Mrs Porter had already informed the Zurich that the gates had been lifted off their hinges. The case had been reported to the police and given a police number so, had they wished to, Capita could have made any further investigations themselves.
140. So, in relation to Theft 1, I do not consider that the breach of Condition 3 can have the draconian consequences alleged by the Zurich. In fact, on the evidence before me, I do not believe that the breach has made any difference to the situation at all. There has been a breach of contract, but as things presently stand, it would only warrant nominal damages. It would not deprive Mr Porter of his substantive claim in respect of Theft 1.
141. I acknowledge that the position is more complex in relation to Thefts 2 and 3. Much may turn on the real difficulties caused by the absence of investigation in 2001, particularly in respect of the duplication. If the claims have to be considered on an item-by-item basis, then I would be inclined to sympathise with the Zurich in respect of any specific difficulties that they may have in making a proper assessment. As an example, I would have thought that a claim for an item in the Theft 2 claim list, which was also claimed in the fire claim, and which Mr Porter attempted to justify in these proceedings on the ground that, although the item was damaged in the fire, it still had a residual value when it was stolen, would be very difficult to sustain without far better paperwork or other independent evidence, which has been neither pleaded nor provided. But as a matter of principle, which is all that I am presently concerned with, I cannot say on the evidence that Mr Porter's claims in respect of Thefts 2 and 3 must automatically fail as a result of his breaches of Condition 3.
142. For these reasons, I do not dismiss the claims in respect of Thefts 1, 2 and 3. I acknowledge that, for the reasons noted above, the individual claims may be very difficult to pursue, but the breaches are not, without more, a reason in principle why Mr Porter should be prevented from maintaining the theft claims. The precise consequences of Mr Porter's breaches for the individual claims will have to be addressed at the quantum hearing, as Mr Sterling suggested, if the claims themselves cannot be agreed.
143. Mr Crowley also complains that, because of the absence of investigations, the Zurich have incurred costs in these proceedings which they would not otherwise have had to incur. That may be right, but it seems to me that the potential effect of this on costs would be a matter for the judge at the end of the case, not a matter to be decided now. I consider that the same applies to the complaint that the absence of any pre-action process, or even a letter before action, amounts to an abuse of the court proceedings.

J. CONCLUSIONS

144. Accordingly, following the trial on liability, I dismiss the fire claim, for the reasons set out in Section F above. I do not dismiss the theft claims, for the reasons set out in Section I above, although they will need to be radically repleaded, and proper information given by those acting for Mr Porter as to the nature of the claims, the issues of duplication, and all the relevant supporting material.
145. I will deal separately with all questions of costs arising out of the liability trial.

Note 1   This quotation comes from the first report of Dr Mukerjee, dated 23.10.06 and referred to in greater detail in paragraph 71 below.    [Back]

Note 2   Paragraph 3 of the Reply.    [Back]

Note 3   The questions were, in my judgment, risibly one-sided. Television companies making programmes of this sort have a responsibility to be even-handed; if they are not, they simply get the story that they want, rather than the truth.    [Back]

Note 4   In my judgment, Dr Mukherjee has been, together with Mrs Porter, a clear and obvious support for Mr Porter during his years of rehabilitation since the fire.    [Back]