Clause must consider causation

Blackburn Rovers FC v Avon Insurance - (Court of Appeal - 11 April 2005)

The Court of Appeal found that the incorrect test had been applied in interpreting an exclusion clause in a policy of insurance.

Premiership football club Blackburn Rovers maintained personal accident cover in respect of its players with Avon Insurance. Martin Dahlin, a striker, sustained a back injury during a practice match. Shortly thereafter he began to suffer from back pain that ended his career. It was thought that the incident may have exacerbated pre-existing disc degeneration in his spine of a type common for a man of his age. The policy excluded disablement resulting from permanent total disablement attributable to arthritic or other degenerative conditions.

The trial judge held that the only sensible way to interpret this exclusion clause, to give it its ordinary meaning and to reflect the true intention of the parties, was to only include degenerative conditions that were sufficiently serious as to amount to an illness but not degenerative changes that amounted to no more than typical ageing for the male population.

It was held that to hold otherwise would cause an unexpected interpretation of the clause and undermine the essential purpose of the cover.

The Court of Appeal disagreed and held that the judge at first instance had erred in concluding that his interpretation of the clause was the only sensible way of construing it. He had failed to consider the crucial issue of causation.

There was a range of medical opinion on whether and to what extent the pre-existing degenerative changes contributed to the injury. On the medical evidence, it was arguable that the degree of disc degeneration experienced by Mr Dahlin may not fall within the phrase "arthritic or other degenerative conditions" as used in the exclusion, but may instead be described as "tissue ageing".

What the judge ought to have asked himself was: (1) has the player suffered a degenerative condition which falls within the definition in the exclusion clause (2) did the degeneration as suffered by Mr Dahlin lead to the injury that resulted in the disablement? If not, Mr Dahlin's disablement cannot be said to arise or be attributable either directly or indirectly to a degenerative condition. If so, there was nothing unreasonable in excluding such degeneration from the policy, normal or otherwise.

Comment: This case emphasises the importance of not overlooking the issue of causation when construing any policy clause where an insured's medical condition is relevant to its interpretation. It also stresses the importance of parties considering and drafting carefully the correct questions to put to their medical experts to assist in determining whether a policy ought to respond to a claim. Catherine Chalmers, BLM London.

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