Ian Hall v Newall Heeting & AGF Insurance (Queens Bench Division)
Mr Hall, a mesothelioma sufferer, commenced an action against his former employer, Newall Heating, claiming damages for negligent exposure to asbestos during his employment between 1967 and 1974.
Mr Hall obtained a Default Judgement and, because Newall was insolvent, sought to enforce his claim against its employers liability insurer, AGF Insurance, using the provisions of the Third Parties (Rights Against Insurers) Act 1930. AGF successfully defended the claim for the following reasons:-
Although a former broker to Newall gave evidence in the Claimants favour to support the alleged insurers, he did not produce any direct documentary evidence to support it.
The available disclosed documents (while proving the existence of property and public liability policies for other group companies) did not allow the Court to infer the existence of relevant AGF EL cover.
AGF called a senior long-serving Claims Manager to give evidence about its computer database and card index systems. He gave evidence that the systems were comprehensive, reliable and robust, so that the absence of a company and their systems (computer or card index) would be persuasive that the company was not covered by the Insurer. What was entered in fact tended to disprove the existence of the relevant cover.
This was an interesting case in which the Claimant failed to prove that AGF insured Newall against EL risks at the relevant time.
These cases are fact specific; in other cases, persuasive oral testimony has allowed the Courts to fall in favour of Insurers cover even in the absence of documentation, particularly if archive systems did not allow insurers to prove a negative in particular cases (one illustrative example is Gavin Cart vs Zurich Insurance (2007).
The case demonstrates the need for Insurers to realistically appraise their archive systems and to proactively collate all the evidence necessary to support and, if necessary, defend against such claims on the basis of those systems. Witnesses should be formally proofed and Insurers should bear in mind that such evidence is effectively being collated for posterity. This process would be an investment in the future and would also enable Insurers to identify the current limits of their systems, improve them for future entries, and to ensure that the systems can be defended. The replacement for the 1930 Act is currently awaiting Royal Assent. It will streamline and simplify the processes to pursue such claims, but does not affect the need to employ and refine robust and defensible archive systems.