British Waterways v Royal & Sun Alliance Insurance Plc

On 1 December 2004, Mark Wells and his son Luke died, when the Ford New Holland 2120 tractor (with attached Bomford Turner B315 hedge-cutter) (“the Tractor”), in which they were reversing along part of the towpath of the Kennet and Avon Canal between Bridge 111 and Bridge 110 (“the Towpath”), toppled into the river. No one saw this happen, but it was at about 2:30pm when a canoeist saw part of the tractor and hedge cutter protruding above the water line of the canal, and the last people to see them were, respectively, on a run along the canal at about 12:45 and looking down from Bridge 111 at about 1pm. It was, upon examination, clear that the two men had been inside the Tractor, reversing away from Bridge 111 (there being no continued access for the Tractor on the Towpath past that bridge) and that the bank had collapsed under the Tractor as it travelled too near to the edge.

The two men, father and son, were independent contractors, in business as Mark Wells Fencing, supplying their services to the Claimant, a public corporation established under the Transport Act 1962, amongst whose responsibilities was the routine maintenance of the hedgerows, plants and shrubberies along the towpaths of the canal, and in doing so using the Claimant’s tractor and hedge cutter. As will appear, they were substantially to blame for the accident themselves at least because (i) they should not have driven the Tractor (which was 1695 mm wide plus 250 mm for the hedge cutter) along that part of the towpath, which did not allow for a sufficient clearance (the Claimant’s Safety Bulletin 6 provided that the minimum distance between any vehicle or heavy plant and the canal edge should be 1.3m) and (ii) they should not have been in the Tractor together: the cab was designed for a single person only and there was a sign in the cab stating that one person only should ride in the cab. However the Health and Safety Executive (“HSE”) took the view that the Claimant had committed an offence contrary to s33(1)(a) of the Health and Safety at Work Act 1974 (“the 1974 Act”), in that they failed to discharge the duty imposed upon them by s3 of the Act to “conduct [their] undertaking in such a way as to ensure, so far as is reasonably practicable, that persons not in [their] employment who may be affected thereby are not thereby exposed to risks to their health or safety”, and the Claimant was so charged, the particulars being “in that the practices adopted for the use of tractors on the said towpath for construction, maintenance and cutting undertaken by contractors, including Mark Wells and Luke Wells, had not been suitably assessed and were unsafe”.

The Claimant was committed from the Swindon Magistrates Court to the Swindon Crown Court. A “Friskies Schedule” (so called because its regular preparation in such cases has resulted from the recommendations of the Court of Appeal in the case of R v Friskies Pet Care UK Ltd [2002] CAR(S) 401) was agreed between the parties. The nub of the Schedule was as follows:-

“6.

… British Waterways … issued a document entitled “Safety Bulletin 6” which deals with general considerations for site access, requirements of vehicles and ride-on equipment used on towpaths and the consideration of towpath/canal walls in terms of supporting any load from equipment, plant and vehicles.

7.

Safety Bulletin 6 requires

•

Risk assessments to be carried out prior to the use of ride-on equipment, and

•

in relation to the use of vehicles on the towpath, it requires that “the minimum distance should be 1.3 metres from the canal edge for any vehicle or heavy plant/equipment”, and where this requirement cannot be met, a specific strength/stability assessment by a waterway engineer must be undertaken.

8.

Safety Bulletin 6 is regarded by British Waterways as the benchmark guidance for the operation of cutting on the towpath.

9.

Safety Bulletin 6 was distributed in hard copy format by post to over 200 people, including the Waterway Supervisor for the Kennet and Avon Canal. The requirements of Safety Bulletin 6 had been implemented in relation to the Gloucester and Sharpness Canal but, despite being distributed to individuals at the Kennet and Avon, the requirements were not met in this instance and some employees were unfamiliar with its content.

…

14.

At the time of the incident, the primary control on the use of equipment on the towpath was left to the discretion of the contractors. British Waterways had undertaken no surveys to determine the width of the towpaths on the Kennet and Avon Canal and was therefore not in a position to adequately control the equipment. It was reasonably practicable for British Waterways to undertake such surveys as these had been undertaken by those in control of the Gloucester and Sharpness canals, which had adopted a procedure in line with Safety Bulletin 6.

15.

It was known to British Waterways that unsupported canal banks erode leading to weakening and/or collapses. British Waterways therefore carried out monthly length inspections from the towpath in addition to principle and intermediate inspections. However, British Waterways failed to reassess the risks associated with working with equipment on the towpath, despite knowledge of previous incidents.

16.

Evidence suggests that on the day of the accident the tractor and Mark and Luke Wells accessed the towpath via the gate at Bridge 110 and then travelled along the towpath towards Bridge 111.

17.

There is no suitable exit from the canal towpath at Bridge 111, so to exit the towpath they would have had to reverse back along the towpath all the way to Bridge 110 or turn around at some point on the towpath.

…

2.

Foreseeability

2.1

It was known to British Waterways that unsupported canal banks erode leading to weakening and/or collapses, hence British Waterways annual surveys from the canal.

2.2

British Waterways had knowledge of previous collapses leading to equipment entering the canal.

2.3

The creation of Safety Bulletin 6 recognised the dangers associated with using equipment on the towpath.

2.4

British Waterways failed to take full account of risks in its control that were clearly foreseeable.

3.

Falling short of safety standards required

3.1

Despite knowledge of previous incidents, British Waterways failed to assess the risks associated with working with equipment on the towpath.

3.2

British Waterways had undertaken no surveys to determine the widths of the towpaths under its control on the Kennet and Avon canal and was therefore not in a position to control the use of equipment.

3.3

It was reasonably practicable for British Waterways to undertake such surveys as these had been undertaken by those in control of the Gloucester and Sharpness canals which had adopted a procedure in accordance with Safety Bulletin 6.

3.4

At the time of the incident, the primary control on the use of equipment on the towpath was left to the discretion of the contractors. Many of the contractors had not been provided with a copy of Safety Bulletin 6.

3.5

The risk assessments were not suitable and sufficient.

3.6

British Waterway employees were not aware of Safety Bulletin 6.

Craig Hunter (Supervisor)

Michael Hawkins (Operative)

3.7

British Waterways failed to ensure the hedge cutting process was operated, supervised and controlled in accordance with its own requirements specified in Safety Bulletin 6.”

The Claimant pleaded guilty at the Swindon Crown Court and was fined £100,000, after a fully argued sentencing hearing in which the Prosecution and Defence Counsel both addressed the Judge at length.

Mark Wells’ partner and Luke Wells’ infant son and their estates (“the Trowbridge Claimants”) sued the Defendant in the Trowbridge County Court. Their claims were not very sensibly pursued, as the pleadings alleged that the deceased were employees of the Claimant, which they plainly were not, but while those representing the Claimant as defendant in that case made such use of that error as they could, it was apparent that, at some stage prior to the trial, such pleadings would be bound to be amended. The Claimant, with the benefit of advice from leading Counsel and robust negotiation by its Solicitors, achieved a negotiated settlement with the Trowbridge Claimants, taking into account suitable discount for contributory negligence: the settlement figures, with which no issue is now taken, were £76,250 for Luke’s son, £105,000 for Mark’s partner and £3,954 for the estates, making a total of £185,204. In addition there were costs, to which I shall refer later.

The claim before me has been brought by the Claimant against the Defendant Insurers, Royal & Sun Alliance Insurance Plc, who were put on notice but did not and do not accept that the Claimant’s claims are covered by the policy in question, being the Defendant’s Fleetshield Policy.

The relevant clauses fall within Section 2 of the Policy “Liability to Third Parties”. They are as follows:

“A.

Cover

Sub-Section 1 – Indemnity to Policyholder

The Insurers will indemnify the Policyholder in respect of legal liability incurred for damages and claimant’s costs and expenses in respect of accidental

(a)

death of or bodily injury to any person

…

in connection with the use of the Insured Vehicle including loading or unloading.

The Insurers will in addition pay in respect of any event which may be the subject of indemnity under this Sub-Section

(i)

solicitors’ fees for representation at any coroner’s inquest or fatal inquiry or court of summary jurisdiction

(ii)

costs and expenses incurred with their written consent

(iii)

…

B Exceptions.

Exceptions to Section 2

The Insurers shall not be liable

(i)

for liability arising out of

…

(i)

the operation as a tool of the Insured Vehicle or attached plant.

…

except as required by any road traffic legislation.”

There have been four issues as to liability ably argued before me by Mr Daniel Shapiro of Counsel for the Claimant and Mr Jeffrey Terry of Counsel for the Defendant:

These were, save for questions as to quantum, the only issues which survived the cut and thrust of pleadings, and amendments of both sets of pleadings were presented in the days leading up to the trial to reflect both clarifications, and in some cases abandonment, of a number of other issues. I shall only deal with those matters when it comes to my consideration of the question of costs. As to quantum, if the Claimant otherwise succeeds, then:

The basis upon which Mr Shapiro submits that the Claimant was liable to the Trowbridge Claimants, reliance upon the Occupiers Liability Act having being abandoned, is by reference to the Provision and Use of Work Equipment Regulations 1998 (“PUWER”), and to common law. That case is concisely set out in, and draws from the contents of, the Friskies Schedule, extracts from which have been set out in paragraph 3 above, but is expanded by the Claimant in the recently amended pleadings and in submissions. By way of what Mr Terry categorised as, and clearly is, a ‘jury point’, Mr Shapiro points to the detailed schedule pleaded by the Defendant, annexed to its unamended Defence, in which, at a time when it was running a case, now abandoned, that the Claimant was effectively reckless in failing to take all reasonable precautions to prevent injury loss or damage, so that it was said that the Defendant’s liability under the Policy was thus excluded, the Defendant’s own pleading set out a catechism of defaults by the Claimant (without prejudice to its denial of liability).

The starting point is that the Claimant has been convicted (on its plea) as set out in paragraph 4 above. Although by s47 (1) of the 1974 Act “nothing in this Part shall be construed ... as conferring a right of action in any civil proceedings in respect of any failure to comply with any duty imposed by section (3)”, the Claimant relies upon the terms of s11 of the Civil Evidence Act 1968, whereby:

“(1)

in any civil proceedings the fact that a person has been convicted of an offence by or before any court in the United Kingdom … shall ... be admissible in evidence for the purpose of proving, where to do so is relevant to any issue in those proceedings, that he committed that offence, whether he was so convicted upon a plea of guilty or otherwise ”

In Hunter v Chief Constable of the West Midlands Police [1982] AC 529 Lord Diplock (with whom the rest of the House agreed) said at 544D:

“Section 11 makes the conviction prima facie evidence that the person convicted did commit the offence of which he was found guilty; but does not make it conclusive evidence; the defendant is permitted by the statue to prove the contrary if he can. ”

Mr Terry accepts that he thus bears the onus of proof in dislodging the presumption that the Claimant breached its duty under s3 in the respect set out in paragraph 2 above, so as to have been liable to the Trowbridge Claimants.

The relevant paragraphs of PUWER are as follows:

“3(3) The requirements imposed by these Regulations on an employer shall also apply-

(a)

to a self-employed person, in respect of work equipment he uses at work;

(b)

subject to paragraph (5), to a person who has control to any extent of-

(i)

work equipment;

(ii)

a person at work who uses or supervises or manages the use of work equipment; or

(iii)

the way in which work equipment is used at work,

and to the extent of his control.

…

4.

…

(2)

In selecting work equipment, every employer shall have regard to the working conditions and to the risks to the health and safety of persons which exist in the premises or undertaking in which that work equipment is to be used and any additional risk posed by the use of that work equipment.

(3)

Every employer shall ensure that work equipment is used only for operations for which, and under conditions for which, it is suitable.

…

8(1) Every employer shall ensure that all persons who use work equipment have available to them adequate health and safety information and, where appropriate, written instructions pertaining to the use of the work equipment.

…

9(1) Every employer shall ensure that all persons who use work equipment have received adequate training for purposes of health and safety, including training in the methods which may be adopted when using the work equipment, any risks which such use may entail and precautions to be taken.”

The following was, before me, common ground:

There was no oral evidence called before me. The evidence consisted of 45 Agreed Facts, and of witness statements, primarily those provided for the purposes of the HSE prosecution, in some cases slightly expanded, from 26 witnesses; none of these were called to be cross-examined, but all were treated as in evidence before me, including the evidence of two HSE Inspectors, Ronald Jervis, who inspected the scene at 21.00 on the same day as the accident, 1 December 2004, and again on 2, 9 and 10 December, and Andrew Kingscott, who inspected the scene on 9 and 10 December, both of whom provided evidence in the HSE prosecution. No order was sought or granted for the admission of expert evidence in these proceedings. There was some discussion about this between the solicitors, culminating, after objection taken by the Defendant’s solicitors, in a statement by the Claimant’s solicitors in their letter of 28 January 2011 that they did not seek to rely upon Messrs Kingscott or Jervis as an expert witness and that: “any expression of opinion within [their] statement[s] is made as a way of conveying relevant facts personally perceived by [them in their] capacity as HSE Inspector.”

In the event, the statements were before me, and Mr Terry accepted that I should make of them what I could, without specific objection by him, always subject to his case that they had not been cross-examined (though recognising that, more than seven years on, they would be unlikely to change their views). Of the Agreed Facts, perhaps the most significant are No 15, namely that “The Tractor was unsuitable for use on [at least parts of] the Towpath because it was too big to be used safely on narrow stretches of the Towpath” and in Agreed Fact 33 the passage, drawn from paragraph 17 of the Friskies Schedule, that “there is no suitable exit for the Tractor at Bridge 111 or between Bridges 110 and 111. It would be necessary for the Tractor to return to exit via the gate at Bridge 110 either by turning round or reversing”. It is also plain, though not specifically admitted, that the Defendant was fully familiar with the risks of banks collapsing such as occurred in this case (as per paragraph 2.1 of the Friskies Schedule set out in paragraph 3 above).

I turn to consider a number of central documents in the case. Pursuant to a request from Mr George Meer, the then Waterway Supervisor for the Kennet & Avon Canal, dated 19 April 2004, Mark Wells sent in a quotation dated 5 May 2004 “Re: Hedge cutting contract … to carry out hedge cutting on Kennet & Avon Canal to [the Claimant’s] specification: cost £4.50 per chain based on approximately 4000 chains”. There is a purchase order, stating “Contact Person G Meer” dated 10 September 2004, which it is to be noted does not relate to the Towpath where the deceased were hedge-cutting on the day they died: it reads (inter alia) “This is a calloff order to complete the hedge cutting from bath to devives [sic] top lock as per your quotation recieved [sic] May 2004 … Where towpah [sic] is to [sic] narrow for tractor, hand cutting will be required … This is a call off order and does not guarantee any work as a result of the order. Each individual item of work arising as a result of this order shall be instructed separately but shall be governed by the terms and conditions of this order”. It is to be noted:

Four other Agreed Facts are of relevance. The first is No 40, in which it is recited that before the deceased began hedge-cutting work in 2004 Mr Meer discussed with the deceased the areas (not at that stage including the material Towpath), as to which were suitable for cutting with the Tractor, which with the smaller Kubota tractor and which by hand. “During these discussions Mr Meer told Mark Wells of the need to leave at least 1 metre clearance between the tractor wheels and the edge of the Canal bank. Mr Meer had discussed the need to maintain at least 1 metre clearance from the Canal bank with Mark Wells on previous occasions as well.”

The Agreed Facts continue as follows:

“41.

During the same discussions prior to the commencement of hedge cutting in 2004, Mr Meer advised Mark Wells that, if he was unsure about any particular area, he should not use a tractor but cut by hand.

42.

Mr Meers also advised Mark Wells at about the same time that Mr Hunter, the Waterways Supervisor for the area of the Canal which included the Towpath, wanted to speak to Mark Wells before Mark Wells carried out any hedge cutting on his section of the Canal.

43.

Neither of Mark or Luke Wells in fact discussed matters with Mr Hunter before beginning hedge cutting work on the area of the towpath for which Mr Hunter had responsibility, including the Towpath.”

As to these facts:

There had been previous incidents involving Mark Wells. On 26 November 2003 (Agreed Fact 39) he had been driving a tractor when the front right-hand wheel had slipped off the edge of the towpath, and there was a similar event in February 2004, of which two lock-keepers, Mr Stephens and Mr Adlem speak in their statements. Agreed Fact 44 records that Mr Meer was aware of these incidents, and “made it clear to Mark Wells after these incidents that only the appropriate size tractor should be used, depending on the width of the towpath, and that hand cutting should be used where the towpath was too narrow for the safe use of either tractor”. However:

Agreed Fact 45 records that another contractor, Mr Onslow, was advised, by Mr Hunter, of areas of the towpath which were considered too narrow for safe tractor use. But such instruction was not given to the deceased in relation to this towpath; and such advice given to Mr Onslow, and the simultaneous discussion between Mr Meer and another contractor Mr Cleve, in which Mr Cleve told Mr Meer, as recently as April 2004, that, in his opinion, the Claimant’s equipment was too big, and that safety was compromised as a result, only emphasise the absence of any supervision of the selection of the equipment by the deceased on 1 December 2004.

Finally, there is the fact, recorded in paragraphs 3.2 and 3.3 of the Friskies Schedule set out in paragraph 3 above, that no survey had been carried out of the widths of the towpaths under its control on the Kennet & Avon Canal, whereas such surveys had been undertaken in respect of other canals. Had this been done, and/or if, in accordance with Safety Bulletin 6, an appropriate risk assessment had been carried out in respect of the Towpath prior to use of “ride-on equipment” on the Towpath (or proper consideration been given to the risk assessment which Mark Wells himself had prepared), then there might have been no need for specific instruction prior to a particular job, because there could have been confidence that sufficient information had been given to the contractors to enable them to carry out work on any part of the canal.

I turn then to a consideration of the relevant case law. With regard to PUWER, the parties agree that the relevant authority is Jennings v Forestry Commission [2008] ICR 988 CA. The central issue in that case was, by reference to Regulation 3(3), by which the Regulations applied to a person who has control to any extent of work equipment and the way in which it is used, as Richards LJ put it at 997G, that “the nature of the claimant’s case … that the Forestry Commission was in a position to prevent his using the landrover at all or to restrict its use to parts of the fence line where it was safe to use it.” The claimant, an independent contractor, discussed the job with the defendant’s contract manager and decided to use his own vehicle, and the defendant had no contractual right to direct him not to transport fencing materials by means other than helicopter or all-terrain vehicle. The Court of Appeal concluded that, as a matter of fact, the defendant did not have control over the use of equipment, and that both parties acted on the understanding that it was for the claimant to decide how to do the work, including what use was to be made of his own vehicle.

It seems to me clear that if the ‘employer’ has control in respect of the vehicle to any extent, then it is to that extent liable if it negligently exercises that control. In Mason v Satelcom Ltd [2008] ICR 971 CA Longmore LJ recorded, in paragraph 12 at 977, that the Regulations only apply to the extent of the employer’s control, and in that case also the Court of Appeal concluded that the claimant used a ladder, which he had found available and had not been provided to him by the defendant, in his own way for his own purpose: and the defendant had no control over the claimant’s decision whether the ladder was to be used or not. In this case, unlike in Jennings, the equipment provided, the Tractor with attached hedge-cutter, was the Defendant’s equipment, not the Claimant’s, and, unlike in Mason, it was specifically provided to the deceased, in the sense that they collected it from the Claimant, as they had on many previous occasions, for the purposes of carrying out the work. The Claimant could have imposed, but did not, limitations upon the use of a tractor by reference to the work intended, but, in the circumstances set out above, their inadequate system did not enable them to do so.

As for common law negligence, there is ordinarily only liability in respect of provision or selection of safe equipment where the claimant is an employee (Jones v Minton Construction Ltd 15 KIR 309). Even then, the employer may not be liable if it is clear that no instruction as to the use of the equipment was necessary (see Richardson v Stephenson Clarke Ltd [1969] 1 WLR 1695 but cf Ross v Associated Portland Cement ManufacturersLtd [1964] 1WLR 768 HL). However the Claimant relies upon Wheeler v Copas [1981] 3 AER 405, in which a labour-only subcontractor was provided with an inadequate ladder by the defendant, and the defendant was found liable. This is still good law, according to the most recent text books including Munkman on Employers Liability (15^th Ed), which refers to Makepeace v Evans Brothers (Reading) [2001] ICR 241 CA, in which the Court of Appeal concluded that a common law duty might, but on the facts did not, arise in respect of the provision of a tower scaffold by the main site contractor to the employee of a subcontractor.

I am satisfied that, on the facts set out above, the Defendant has failed to rebut the presumption established by s11 of the Civil Evidence Act arising out of the Claimant’s conviction, and thus that the Claimant did expose the deceased to risks to their health or safety by adopting practices for the use of tractors on the towpath which were not suitably assessed and were unsafe; but, in any event, I am satisfied, by reference to the facts set out above, that the Defendant, in breach of PUWER and its common law duty of care, provided the Tractor and/or permitted the deceased to select the Tractor without any, or any adequate, supervision, instruction or warning with regard to the job which it knew or ought to have known the deceased were to carry out. Issue 1 is thus resolved in favour of the Claimant, namely that it was liable to the deceased.

This is a question of construction of Sub-Section 1 of the Policy set out in paragraph 7, at A, above. The principles of construction are clear. Mr Shapiro relies upon the basic argument that the words in the clause mean what they say, but, if necessary, relies upon the guidance of Sir Anthony Clarke MR in Pratt v Aigaion [2008] EWCA Civ 1314 as to interpretation by adopting a commercial approach. He submits that the cover extends to legal liability (such as I have found) for damages in respect of accidental death of any person in connection with theuse of the Insured vehicle, including loading or unloading, such that the Claimant must succeed.

Mr Terry relies upon the factual matrix. The Policy is not one in respect of public liability, but is a policy of insurance of the Claimant’s vehicles. The certificate of Motor Insurance, issued pursuant to the Policy, is in respect of “any Agricultural or Forestry Vehicle the property of the Policyholder or hired or lent to him other than by any person in his employ”. It is in effect insurance in respect of the Claimant’s liability under the RTA, i.e. so as to comply with its obligations under s145(3)(a), set out in paragraph 8(iv) above.

Thus Mr Terry submits that the Policy, like the RTA itself, should be construed in accordance with Cooper v MIB, so that the reference to any person excludes the driver or user of the vehicle (see paragraph 8(iv) above). Thus legal liability in respect of accidental death to any person does not include cover in this case for the death of the deceased, but in any event the liability must be in respect of the death of any person in connection with the use by theClaimant [or any of its employees] of the insured vehicle. That is the main issue in relation to construction of this clause.

There is also a further issue raised by Mr Terry, namely as to whether the clause should be construed so that the cover is in respect of “legal liability ... in connection with the use” of the vehicleor“legal liability incurred in respect of accidental death of or bodily injury to any person in connection with”such use. Two cases relevant to connection with use of a motor vehicle have been considered, one on either side of the line, both in respect of cases in which the person injured was outside the vehicle, Dunthorne v Bentley [1999] Lloyd’s Rep I & R 560, where a lady had left her car parked and ran across the road, causing an accident, and Slater v Buckinghamshire CC [2004] Lloyd’s Rep I & R 432, where a disabled boy ran across the road in order to get in to a vehicle, again causing an accident. I am however satisfied that, however the cover should be construed in this regard (and a similar argument arises below in relation to the construction of the Exception), in this case both the liability and the death (if such do raise different questions) arose in connection with the use of the vehicle.

It is perhaps of some subsidiary interest that in Dunthorne both Laws J and Rose LJ refer indiscriminately to theuse of the car and her use of the car, although the main issue, to which I now turn, was not under scrutiny in that case. With regard to that main issue, a number of arguments have been raised:

I am satisfied, for the reasons given by Mr Shapiro, that the wording of the cover should not be restrictively construed, and that there is no ground for limiting it by reference to seeking to assimilate the wording to that of s145 of the RTA. There was liability in this case incurred for damages etc in respect of the accidental death of two persons, the deceased, in connection with the use (by the deceased) of the Insured vehicle.

I shall take these two issues together, and deal first with the RTA Exception. If the Tool Exclusion applies, then it does not exclude from cover any liability which is required to be covered by any road traffic legislation. I have already set out, in paragraph 8(iv) above, that Mr Shapiro concedes that insurance by the Claimant of liability in respect of injury to Mark Wells as driver is not required by road traffic legislation. The only issue therefore relates to his son Luke. The issue is whether he was a user, in the sense of joint user of the vehicle, and not simply a passenger. Of course, because there was no witness of the actual collapse of the tractor into the canal, it cannot be known precisely what Luke was doing at the time, but Mr Terry points to the evidence of Mr Kingscott (part of the expert opinion to which he in the end did not object) which describes how the operator of the tractor would spend much of his time looking out of the rear and left-hand side of the tractor rather than look directly where he was going, which would suggest that although, as set out in paragraph 2 above, there was a prohibition of a second man in the cab, nevertheless in fact Luke may have been acting as a look-out. Although Ms Franks, the lunchtime runner, to whom I referred in paragraph 1 above, saw Mark in the cab and “another younger man [obviously Luke] in front of thetractor”, on the previous day a Ms Fetherston-Godley had seen them (on a different towpath) cutting the hedge with both of them in the cab of the tractor, while Mr West, the other witness referred to in paragraph 1 above, when he looked over the bridge, could see two men in the cab in the process of cutting the hedge: “they both appeared to be seated and I assumed that they were sharing a single seat of the tractor. They were certainly wedged in very tightly”. I am quite satisfied that, whether or not the tractor was still in the process of hedge-cutting when the accident occurred (see further below), the two men were jointly using the tractor. Insurance cover for both of them was thus not required of the Claimant by any road traffic legislation.

The burden of establishing that the Tool Exclusion applies is upon the Defendant. Resolution of it is partly dependent upon fact and partly upon questions of law. Mr Terry submits that, on the balance of probabilities, at the time of the accident the Tractor was still engaged in the operation of hedge-cutting. Mr Shapiro submits that the Defendant cannot establish that as a matter of fact, and, further, that I should be satisfied that, at the time of the accident, the deceased had stopped hedge-cutting and were reversing the Tractor in order to get back to Bridge 110 and exit the Towpath.

I shall deal first with that issue. If Mr Terry is right, then Mr Shapiro would concede that the liability arose out of the operation of the insured vehicle or attached plant as a tool. If however the deceased had stopped hedge-cutting, then Mr Terry still contends that he can establish the availability of the Tool Exclusion, and this depends upon two issues:

I turn first to the facts. Mr Terry refers to the evidence of Mr Jervis and Mr Kingscott as to what they saw on their inspection, Mr Jervis of course very shortly after the accident on the day. Mr Kingscott refers to the fact that the Bomford 315 hedge-cutter is only capable of being used on the left-hand side of the track:

“Therefore hedge-cutting can only be carried out in one direction along the towpath. Where the height of the hedge is greater than the cutting dimension of the cutting head, the tractor would have to reverse and make ... further passes ... It was identified that prior to the incident the tractor had gained access to the canal at bridge 110. It had progressed along the canal towpath trimming the hedge as it went. The hedge along this section was intermittent ... It was noted in a number of sections that there was evidence of multiple passes in that there [was] more than one set of wheel tracks where the tractor had reversed and made a second pass ”

Thus Mr Terry submits that the likelihood is that, when the Tractor was reversing, at the time it toppled into the canal, it was, in the context of such multiple passes, doing so in order to ‘reculer pour mieux sauter’, such that they were still carrying on the operation of hedge-cutting along the Towpath. Mr Terry also points to the plan drawn up after the accident which appears to show that there was, opposite the point where the Tractor collapsed into the canal, still a protruding area of “dense bushes”, i.e. waiting to be cut. However Mr Shapiro counters this by reference to photographs taken by Mr Kingscott showing that there was, at that position, no protruding hedge to be seen.

It was, however, the view of both Mr Jervis and Mr Kingscott (as is impliedly recorded in paragraph 17 of the Friskies Schedule, set out in paragraph 3 above), that, when the Tractor collapsed into the canal, it was in fact in the process of reversing to the exit after conclusion of the hedge-cutting. Though I exercise the promised caution (see paragraph 17 above) as to the evidence of the Inspectors, I see no reason not to accept it. Mr Jervis notes that there was no direct access to allow the Tractor to exit the Towpath at Bridge 111, so that the driver would have to reverse, or attempt to turn round. He considers that “it would appear that the tractor was then reversed; the line of the tractor reversing was closer to the edge of the bank than its previous forward motion.” Mr Kingscott also addresses the fact that there was no facility to allow the Tractor to get off the Towpath at Bridge 111, so that the driver of the machine would be faced with the two alternatives, and he concludes that:

“The tractor then reversed on a line closer to the edge of the canal than during its previous forward motion. The driver had to reverse, as the dimensions of the tractor would not allow it to be driven under the bridge. As the tractor reversed … the edge of the towpath was unable to sustain the weight of the tractor and collapsed. This caused the rear wheel of the tractor to drop rapidly, inducing a turning moment such that the tractor turned over and became submerged in the water. ”

The fact that Luke was in the cab is, in my judgment, neutral as to whether he was so in the course of acting as a lookout to assist with the hedge-cutting (as above) or, perhaps even more necessary, acting as a lookout to assist in the reversing exercise.

I am satisfied that it is not proved that the operation of hedge-cutting was still continuing, and, if anything, I am satisfied that it was not. Before I turn to consider the legal questions, there is another minor issue of fact raised by Mr Terry, which, he submits, supports his case that the Tractor was, at the material time, being operated as a tool, namely his suggestion, by reference to the evidence, that it was not driven to the Towpath as a vehicle, but was carried there on a low loader or similar other vehicle. The evidence, however, is not at all clear and, indeed, is inconsistent on this. Ms Fetherston-Godley had seen the deceased on the previous day “driving away in a low loader on which the tractor was carried”. Ms Bathe recollected seeing a white flat-bed lorry or van, at about 11am on 1 December 2004, stopped at the road side near Bridge 110, which she connected up with the hedge-cutting. In one of the photographs a white van can be seen. On the other hand, Mr Barker and Mr Lee, respectively proprietors of a local café and a local pub, recall the deceased – as to Mr Barker in relation to breakfast on the very morning – driving the Tractor and parking it in the car park. I am not persuaded that, on the evidence, I can be satisfied as to whether the deceased transported the Tractor to the bridge or drove it there – the evidence in fact points the other way. In any event I do not consider that I would be assisted with regard to the issue as to whether, at the material time, the Tractor was being operated as a tool, whichever way I resolved this factual dispute.

I turn then to the first of the two ‘legal’ questions. Mr Terry submits that I should construe “liability arising out of the operation as a tool” by reference to the breach of duty/breach of Regulations which I have found against the Claimant. This was a breach, i.e. negligent failure of system etc arising out of the operation of the Tractor as a tool. So, whether or not the hedge cutting was going on at the time, or indeed whether or not the deaths arose out of the operation of the Tractor as a tool, what is significant is whether the liability, in the respects I have found, so arose. Mr Shapiro submits that liability does not arise in tort until there is an injury or death: otherwise, as I put it to him, there would be injuria sine damno, and thus no liability. The liability which the Defendant is required to cover (subject to any exclusion) accrues when the injury/loss is incurred, and that arose, or, on the Defendant’s case, does not arise, by consideration of the operation of the Tractor, not of the antecedent breach. I agree with Mr Shapiro.

On the basis, in accordance with my findings above, and ignoring the niceties of the onus with which I have there dealt, that the deaths occurred when the deceased were reversing the Tractor away from a completed parcel of hedge-cutting in order to move on to the next towpath, did the deaths “arise out of the operation of the Tractor as a tool”? This depends upon the meaning of the words “arising out of”. Although the onus is on the Defendant to establish the availability of the Tool Exclusion, I do not see that that impinges upon the construction, unless it be that there is a different meaning of the words “arising out of” in an exclusion clause from in a clause relating to cover, where the onus is upon the insured.

There has been a series of apparently conflicting decisions as to the meaning of arising out of in the insurance context:

It does seem as though there is, at any rate if the Scottish cases are to be taken into account, a more stringent approach to the need for establishment of causation where exclusions are being considered than (as in Beazley) where the question is as to whether there is indemnity under the policy. But the words of Scrutton J and Donaldson J in any event have to be set against the words of Rose LJ and Pill LJ, relying on the Australian judgment. Clarke Law of Insurance Contracts has a passage which appears to suggest that there might be a different approach in relation to exceptions or exclusions. At chapter 19 (19-1C2), Mr Clark states “in principle, an exception is not operative unless it is the proximate cause of loss. As a matter of strict interpretation of the contract of insurance, an exception is not proximate unless it is the inevitable cause of loss.” His only support for this proposition, in footnotes, is to cross-refer to his chapter on Causation (Chapter 25), and there is then a passage in Chapter 25-9C1(c) in which he considers the words “arising out of”, but he there states, without referring to any of the cases discussed above, other than the Australian case referred to in Dunthorne, that such phrase is “clearly wider than “directly or indirectly” caused by”.

Consideration of these authorities does not provide a clear answer. As a matter of strict precedent, it may be that I am bound by the decision in Dunthorne in the Court of Appeal. On the other hand there was no reference in the Court of Appeal in that case to Coxe or Evaggelos, and to the persuasive words of two very experienced commercial judges. I have the very recent analysis of Christopher Clarke J who suggests perhaps a half-way house of “arising out of” but with a “relatively strong degree of causal connection”, and I have the inevitable feeling that a court may in fact have a different approach to concluding whether there is cover for an event from where the court is being asked to conclude that an insurer can exclude cover, even though the words the court is considering may be identical.

Mr Shapiro invited me to look at dictionary definitions as to the meaning of the word operation or operating, but I do not consider that that is going to assist, when the real question is whether the deaths of the deceased father and son in the tractor here arose out of the operation of the tractor as a tool. The facts, as I have found them to be, are that the Tractor had ceased its work of hedge-cutting. The Tractor was however in its place on the Towpath because the deceased had brought it there in order to carry out hedge-cutting, and it was exiting from that Towpath in order to move elsewhere to a different towpath, in order to recommence hedge-cutting. The accident took place immediately after hedge-cutting had been carried out. The fact that the Tractor was so near to the edge of the bank was a consequence of its having been on the Towpath, carrying out the operation of hedge-cutting. However, at the time when it toppled into the canal, it was no longer carrying out hedge-cutting and was being driven in reverse as a vehicle. The proximate cause of its toppling into the canal was its being reversed too close to a vulnerable part of the bank.

I have not found this an easy decision. I conclude that the operation of the insured vehicle with attached plant as a tool was not the proximate cause of its collapse into the canal which, upon the basis of Scrutton J, Donaldson J and the Scottish cases (and the assertion in Clarke Chapter 19), is required. In any event, whether or not there was a relatively strong degree of causal connection (per Christopher Clarke J at 130) and whether or not the use of the Tractor was “causally concomitant but not causally connected with the accident” (per Pill LJ at 563), I am not satisfied that the deaths, and the liability for the deaths, arose out of the operation of the Tractor as a hedge-cutting tool, but it rather arose out of the collapse of the bank when, after completing that phase of the operation, the Tractor was being reversed. The Defendant accordingly does not establish the Tool Exclusion.

Accordingly I find for the Claimant, and make the orders in respect of quantum referred to in paragraphs 5 and 9 above.