Scottish Court of Session Decisions

[1] In this appeal from the decision of the Sheriff at Kilmarnock no less than four parties were represented and ready to advance arguments. In fact, however, we heard argument on behalf of only two of them, the second third party, the Co-operative Insurance Society Ltd. ("the insurers"), and the second defender and third party, Mr. Peter Anderson. Mr. Haddow, Q.C., who appeared for the insurers, submitted that the Sheriff had been wrong to pronounce a declarator that, in the circumstances, the insurers were liable to indemnify Mr. Anderson, and that we should recall that part of his interlocutor of 12 February 1999. For the reasons which we give in this opinion we refused the insurers' appeal and counsel for the pursuers then abandoned their appeal against the Sheriff's decree of absolvitor in respect of the first defender, Mr. Gordon Irving. We are therefore concerned only with the dispute between the insurers and Mr. Anderson. At the start of the hearing before us Mr. Haddow sought leave to amend his grounds of appeal and to ask the court to make certain additional findings in fact. We refused the motion since he was able to give no proper reason why, if it was to be made at all, the motion had not been made much earlier and, in any event, at the By Order hearing. It follows that the appeal falls to be decided on the basis of the Sheriff's findings in fact.

[2] It is a matter of agreement that at the relevant time, in October 1992, Mr. Anderson's wife, Mrs. Alexandra Anderson, was insured under a Contents Insurance Policy with the insurers. The policy is drafted in a form which is presumably intended to make it more easily understood by policy holders. Each page is divided into two columns, one headed "What IS insured" and the other "What is NOT insured". In the first column Section G, "Family and Occupier's Liability", contains inter alia the following:

The term "Family" is defined elsewhere as meaning "you or any member of your family permanently residing with you" and on the first page of the policy "you" is explained as "the Policyholder named in the Schedule".

[3] The effect of these provisions in the present case was that the insurers insured all sums which Mrs. Anderson, and any member of her family permanently residing with her, became legally liable to pay in respect of accidents resulting in damage to property. Since the Sheriff found Mr. Anderson liable to the pursuers for extensive damage to their house, the contention for Mr. Anderson was that, by the wording in Section G which we have quoted, the sum which Mr. Anderson was liable to pay was covered by Mrs. Anderson's policy with the insurers.

[4] In resisting this claim the insurers relied on words in the part of Section G which appears in the second column, describing what is not insured under the policy. The relevant words are:

Putting the matter briefly, the insurers contended that the damage to the pursuers' house was damage arising from Mr. Anderson's "trade" or "occupation" and was accordingly not insured under the policy. The Sheriff rejected the contention for the insurers on the basis that the damage to the pursuers' house did not arise out of Mr. Anderson's trade or occupation.

[5] The nature of the dispute between the parties becomes clear when we look at the facts.

[6] At the relevant time the pursuers lived at 11 Howard Park Drive in Kilmarnock and Mr. and Mrs. Irving lived next door at number 12. Mr. Anderson, who did not live in Kilmarnock, was employed as a "slater/roughcaster" by Kilmarnock and Loudon District Council. Mrs. Anderson worked in the same building as Mr. Irving. Through Mr. Irving's acquaintance with Mrs. Anderson, Mr. Irving had on occasions asked Mr. Anderson to do jobs on his roof and Mr. Anderson had done them as an obligement for which he did not expect to be paid, although he might receive some payment if a particular job took some hours.

[7] At some point, accordingly, Mr. Irving asked Mr. Anderson to investigate a leaking gutter which he himself had been unable to repair. Mr. Anderson came to the Irvings' house on 16 October, bringing his own ladder, tools and materials, and made his way on to the roof. There he discovered that the leak was coming from a joint in a cast-iron gutter above the doorway. His understanding was that he was to carry out an appropriate repair, making it as permanent as possible. Although he knew that the proper way to repair a leak of this kind was to rejoint it, he quite legitimately decided to leave the gutter in place and to do a cold repair with a sealant. He used a propane blow-torch to dry the area of the gutter near the joint and then repaired the joint with the sealant. While there is no finding on the point, it appears from the Sheriff's note that it was "a five to ten minute job". As he left, Mr. Anderson declined Mrs. Irving's tentative offer of payment. It is a matter of agreement, in terms of a Joint Minute, that the flames from the blow-torch set fire to the horsehair felt on the roof and that this led to a fire which badly damaged the pursuers' house next door.

[8] In considering the application of the policy in these circumstances, we begin by recording that Mr. Haddow did not suggest that it did not apply simply because the events in question had happened far from the Anderson family home. Indeed he was at some pains to stress that his argument would have applied even if Mr. Anderson had been working on the Andersons' own gutter and had caused damage to neighbouring property. Mr. Haddow's argument was simply that, when carrying out the repair on the Irvings' gutter, Mr. Anderson had been engaged in his "trade" or "occupation" as a slater/roughcaster and that the damage arising out of it was therefore not insured under the policy. It so happened that he had been repairing the Irvings' gutter but if his wife had asked him to repair their own gutter, he would also have been engaged in his trade or occupation and so would not have been insured under the policy. This was so, even though Mr. Anderson was actually employed as a slater/roughcaster by the District Council. For Mr. Haddow, it was sufficient that he was exercising the skills which he exercised in the course of that employment.

[9] We are unable to accept that argument, essentially for the reasons advanced on behalf of Mr. Anderson. The terms in section G (ii) of the policy are all examples of a single genus, which may perhaps be described as "the jobs by which the members of your family earn their livelihood" or "what they do to earn a living". In everyday life we use different terms, with - at times subtle - social, educational and other nuances, to refer to particular jobs. A doctor pursues a "profession", a plumber may be engaged in a "trade" and a hairdresser may run a "business". Obviously, there are no rigid lines of demarcation: some may think of hairdressers as being engaged in a "trade" while others may prefer to see it as a "profession". Many plumbers run a "business", while others are employed. Perhaps "occupation" is the most general term, which may explain why it is sometimes used in questionnaires designed to discover what someone does for a living. On this approach, the purpose of this provision in the policy is to indicate that the insurance does not cover damage arising from the acts of the members of the family when they are actually engaged in the job by which they earn their living. If they wish insurance for such damage, then presumably it is available under some other kind of public liability policy with a different premium, taken out by the individual or his employer.

[10] At the relevant time Mr. Anderson was not acting in the course of his employment with the District Council. Nor, on the Sheriff's findings, was he running a business on the side, using his skills as a "homer" to earn money. He was simply repairing the gutter as an obligement to Mr. Irving. He was, in other words, entirely off duty and using his skill to do a favour and help Mr. Irving. Happily, many people do in fact use their skills in just this way - whether it is a professional painter spending Saturday afternoon papering his elderly neighbour's sitting room or an accountant passing an evening in disentangling the accounts of her church social club. But this does not mean that on these occasions they are engaged in their occupation or profession, either according to the common understanding of the situation or in terms of this exception in the insurers' policy. Similarly, although Mr. Anderson may have been exercising some of his skills as a slater/roughcaster when he carried out the repair, on the facts as found by the Sheriff he was simply doing a favour for Mr. Irving and therefore the exception in the policy did not apply to the damage arising out of his actings.

[11] We should simply add that, as soon became apparent in the hearing before this court and from Mr. Mitchell Q.C.'s submissions for Mr. Anderson, Mr. Haddow's argument leads to curious results and fine distinctions which would be unlikely to occur to the ordinary policy holder studying the terms of this clause. We forbear to explore the more bizarre elaborations and mention only the most obvious implications. A professional pianist could not play Happy Birthday at his sister's party without being engaged in his occupation. A professional footballer playing football with his three-year-old son in his back garden would be engaged in his profession and so, if he happened to kick the ball over the hedge and break his neighbour's greenhouse, he would not be insured under the policy. Similarly, someone who loved gardening and liked to help his less enthusiastic neighbour would no longer be insured for damage arising if he decided to become a professional gardener but still did his neighbour's garden for pleasure. For any gardening he did would now be in the exercise of his profession or occupation. The insurers' is, truly, a bleak view of society in which the Good Samaritan finds no place and people never stop working to act out of love or friendship. What makes that vision all the stranger is that Mr. Haddow was quite unable to suggest any reason why the insurers should have wished to insert such an apparently capricious provision into their policy, especially since a person exercising a skill acquired or honed during his employment might well be more skilful, and hence less dangerous, than an enthusiastic amateur.

[12] For these reasons, which differ perhaps in emphasis from the Sheriff's, we refused the appeal.