Employers' Liability Insurance "Trigger" Litigation, Re [2010] EWCA Civ 1096 (08 October 2010)

Employers' Liability Insurance "Trigger" Litigation, Re [2010] EWCA Civ 1096 (08 October 2010)

The Court of Appeal held that, for employers' liability insurance policies, the event which triggers the insurer's liability is the exposure to asbestos during the policy period, not the onset of mesothelioma. The construction of 'sustain injury' or 'contract disease' in the context of these policies refers to the date of causation (exposure), aligning the sustained wording with causation wording. This interpretation ensures that insurance responds to liabilities arising from historic exposures, preventing a gap in cover for claimants affected by long-latency diseases like mesothelioma.

Citation
[2010] EWCA Civ 1096
Parties
Claimant (lead Case 1): Mrs Durham (formerly Fern); Defendant (lead Case 1): BAI (Run Off) Limited (In Scheme of Arrangement); Claimants (lead Case 2): Mrs Fleming & Mrs Eddleston; Defendant (lead Case 2): Independent Insurance Company Limited (In Provisional Liquidation); Claimant (lead Case 3): Mrs Edwards; Defendant (lead Case 3): Excess Insurance Company Limited; Claimant (lead Case 4): Thomas Bates and Son Limited; Defendant (lead Case 4): BAI (Run Off) Limited (In Scheme of Arrangement); Claimants (lead Case 5): Akzo Nobel UK Limited & Amec PLC; Defendant (lead Case 5): Excess Insurance Company Limited; Claimant (lead Case 6): Municipal Mutual Insurance Limited; Defendants (lead Case 6): Zurich Insurance Company and Others; Interested Party: Secretary of State for Work and Pensions
Jurisdiction
England and Wales
Judgment Date
08 October 2010
Procedural Posture
Civil Appeal (insurance Contract Interpretation) / Court of Appeal (civil Division) – Appeal From High Court Judgment
Outcome
Appeal dismissed; High Court judgment affirmed
Legal Topics
Employers' Liability Insurance, Policy Construction, Mesothelioma Claims, Asbestos Exposure, Indemnity, Trigger Litigation
Insurance Law Tort Law Employment Law Employers' Liability Insurance Policy Construction Mesothelioma Claims Asbestos Exposure Indemnity +1 more

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Parties

Mrs Durham (formerly Fern)

Claimant (lead Case 1)

BAI (Run Off) Limited (In Scheme of Arrangement)

Defendant (lead Case 1)

Mrs Fleming & Mrs Eddleston

Claimants (lead Case 2)

Independent Insurance Company Limited (In Provisional Liquidation)

Defendant (lead Case 2)

Mrs Edwards

Claimant (lead Case 3)

Excess Insurance Company Limited

Defendant (lead Case 3)

Thomas Bates and Son Limited

Claimant (lead Case 4)

BAI (Run Off) Limited (In Scheme of Arrangement)

Defendant (lead Case 4)

Akzo Nobel UK Limited & Amec PLC

Claimants (lead Case 5)

Excess Insurance Company Limited

Defendant (lead Case 5)

Municipal Mutual Insurance Limited

Claimant (lead Case 6)

Zurich Insurance Company and Others

Defendants (lead Case 6)

Secretary of State for Work and Pensions

Interested Party

Procedural Posture

Civil Appeal (insurance Contract Interpretation) / Court of Appeal (civil Division) – Appeal From High Court Judgment

Legal Issues

  1. 1 What event triggers liability under employers' liability insurance policies for mesothelioma: exposure to asbestos or onset of disease?
  2. 2 Does 'sustain injury' or 'contract disease' in policy wording refer to the date of exposure or the date of disease manifestation?
  3. 3 Is there actionable injury at the time of exposure or only upon onset of mesothelioma?

Ratio Decidendi

The Court of Appeal held that, for employers' liability insurance policies, the event which triggers the insurer's liability is the exposure to asbestos during the policy period, not the onset of mesothelioma. The construction of 'sustain injury' or 'contract disease' in the context of these policies refers to the date of causation (exposure), aligning the sustained wording with causation wording. This interpretation ensures that insurance responds to liabilities arising from historic exposures, preventing a gap in cover for claimants affected by long-latency diseases like mesothelioma.

Court Disposition

Appeal dismissed; High Court judgment affirmed

Orders

  • Insurers are liable to indemnify employers for mesothelioma claims where exposure occurred during the policy period, regardless of when the disease manifested.
  • Declaratory relief granted in favour of claimants and employers as to the construction of the relevant policy wordings.