UK: (Re)Insurance Weekly Update

Last Updated: 11 August 2011
Article by Nigel Brook

A summary of recent developments in insurance, reinsurance and litigation law

This Week's Caselaw

Thornhill & Ors v Nationwide Metal Recycling
Effect of failure to comply with the Practice Direction on Pre-Action Conduct

The claimants brought a nuisance action against the defendants over the level of noise emanating from the defendant's scrap metal yard. The judge at first instance found there had been an actionable nuisance (now ceased) and awarded damages to the claimants. He also awarded the claimants their costs of the action. The defendants have appealed against that ruling. They argued that because the claimants had expressly refused to engage with the Pre-Action Conduct Practice Direction (which came into force in April 2009), costs should have been awarded in their favour.

The Court of Appeal recognised that the Practice Direction applies to all parties to any prospective litigation and their solicitors and that the claimants had failed to comply with the Practice Direction in several ways, including a failure to engage in discussion and a failure to provide information about their expert's findings, when requested to do so. Furthermore, it was held that the fact that the claimants were seeking an injunction did not provide any excuse (para 4.3(3) of the PD deals with cases in which urgent relief is sought). By engaging at an earlier stage, each side would have had a clearer idea of the strength of each other's cases.

Nevertheless, the defendants were denied the relief which they sought. The claimants had been penalised in costs when they had been ordered to pay most of the defendant's costs of the application for the injunction. By that time, the shortcomings of the claimants' preaction conduct had been put right.

Here is a link to the PD on Pre-Action Conduct: tribunals/courts/procedure-rules/civil/contents/practice_directions/pd_preaction_ conduct.htm

Austin & Ors v Miller Argent
Group Litigation Orders and the need to demonstrate adequate funding

At first instance, the judge refused to make a Group Litigation Order ("GLO") in relation to a proposed group action. (A GLO is an order which permits a number of claims which give rise to common or related issues (of fact or law) to be managed collectively). The claimants appealed that decision. One of the reasons given by the judge was that it was not clear that the claimants had funding in place (either to cover their own costs or to meet any adverse costs order). It subsequently transpired that ATE insurance could not be obtained by the claimants. Nevertheless, they argued that the judge should not have been deflected from granting a GLO by funding considerations (and an alternative source of funding was suggested by the claimants).

That argument was rejected by the Court of Appeal. It was held that, at the date of the hearing, it was not clear that a sufficient number of claimants seriously intended to proceed with the action. Only two claimants had BTE insurance (with a limit of Ł50,000) and "far more than two claimants are necessary to constitute a viable group action".

COMMENT: PD 19B lists the information which must be provided in support of an application for a GLO. The provision of details relating to the funding of the claimants is not listed in the Practice Direction. However, it does require the provision of the "number of parties likely to be involved" and this Court of Appeal decision makes it clear that the question of funding will have a direct impact on that issue (and hence the likelihood of a GLO being made).

Microsoft v Datel Design & Ors:
Costs of abortive application for pre-action disclosure

The (subsequent) claimant in an action had applied for pre-action disclosure of certain documents. That application had become unnecessary following developments in proceedings overseas. The respondent/defendant therefore sought his costs of that application. CPR r48.1 provides that the general rule is that an applicant for pre-action disclosure will ordinarily be ordered to pay the costs of an application, even if the application is successful. However, the court can make a different order, having regard to all the circumstances. In this case, the defendant argued that the normal rule should apply because the claimant's own actions had rendered the application otiose. Arnold J accepted that the starting point was that the defendants should recover their costs. However, he declined to make such an order.

He held that the fairest order in this case would be to reserve costs to the conclusion of a trial. Most significantly, in this case proceedings had, in the event already been commenced. The judge observed that if he were to order the claimant to pay the defendant's costs now and the claimant were to later win at trial, those costs would have to be paid back to the claimant. An order for costs in the case would therefore achieve the same result. However, Arnold J did stress that he had not heard full argument on this point.

Grimes v Hawkins & Anor:
Whether private pool owner owed duty of care to visitor - of possible interest to liability insurers

The claimant was seriously injured after diving into a swimming pool at the home of the defendant (where she was an invited guest). She claimed that he was in breach of his duty to her under the Occupiers Liability Act 1957 to take reasonable steps to ensure that she was reasonably safe in using the premises for the purposes for which she was invited or permitted by the defendant to be there. Thirlwall J rejected an argument that, although the defendant was permitted to use the pool, she was not permitted to dive.

The defendant relied on the House of Lords decision in Tomlinson v Congleton BC [2003] which related to the 1984 Occupiers Liability Act. In that case, Lord Hoffmann had placed particular weight on the importance of the exercise of free will and held that it will be rare to impose a duty on an occupier of land to prevent people from taking risks which are inherent in the activities which they freely choose to undertake on the land. The judge rejected an argument that that case was only authority for trespassing situations. Here, the defendant was not required to adopt a "paternalistic" approach to his visitors, who were all adults exercising their free will: "I do not accept that it is incumbent on a householder with a private swimming pool to prohibit adults from diving into an ordinary pool whose dimensions and contours can clearly be seen. It may well be different where there is some hidden or unexpected hazard but there was none here".

Nor had there been a breach of the duty of care at common law: "it would not be fair just or reasonable to impose upon the defendant a duty of care to the claimant which required him to put his pool out of bounds at night, or to prohibit adults from diving into the pool".

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Nigel Brook
In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.