Makin v Protec & QBE

Hearing dates: 5, 6 December 2024

This judgment was handed down remotely at 10 am on 11 April 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archive.

Note: The documents before the court at trial were contained in a trial bundle, the references to pages of which in this judgment follow the format TB/*** and a supplemental bundle for which the format SB/*** is used. Quotations from documents retain the spelling and grammar of the original.

INTRODUCTION

The Claimant, who is now 37 years old, attended the Muse Bar and Restaurant in Uppermill, Oldham together with friends on the evening on 6 August 2017. He was in what the Particulars of Claim describe as “ high spirits” when, shortly after 8.30pm, he threw a glass on to the floor. The door supervisors, Thierno Diallo 1 and Gareth Coupe, ejected him and, outside of the premises, there was an altercation. In the course of this, Mr Diallo forced the Claimant to the ground and held him in a headlock. After the incident, the Claimant stood up and walked away 2, taking a taxi home (where he lived alone). It would seem that two days later, his mother went to visit him because he had not been in contact and found that he had suffered a stroke.

The Claimant has been left with serious neurological disability as a result of the stroke, said to include right-sided weakness, aphasia, left-sided ptosis, and right homonymous hemianopia. His case is that he is now unable to work, lacks capacity to litigate and has an ongoing and long-term significant need for care from others. It is common ground that the likely value of the claim is in excess of £1 million 3.

The Claimant contends that his stroke was caused by the headlock administered by Mr Diallo. He brought a claim for damages against the First Defendant, which was the operator of the Muse Bar and Restaurant, and the Second Defendant, which was alleged to be the employer of Messrs Diallo and Coupe. The claim against the First Defendant was discontinued. A preliminary issue trial before His Honour Judge Sephton KC on 11 July 2023 (which the Second Defendant did not attend, joint liquidators having been appointed over the company on the day preceding the trial) established that the Claimant had suffered stroke and consequent injury as a result of

At the time of this incident, the Third Defendant was the Second Defendant's public liability insurer under an insurance policy entitled “Security & Fire Protection,” numbered S42426004 for the period 28 February 2017 to 28 February 2018. Accordingly, the Third Claimant was joined to the action pursuant to the Third Parties (Rights Against Insurers Act) 2010 5 by order of District Judge Rome dated 5 January 2024, on the basis that the Second Defendant is (or is potentially) subject to a liability to the Claimant which liability is insured under the contract of insurance with the Third Defendant.

The Third Defendant denies liability to indemnify the Second Defendant (and therefore any liability to the Claimant) for reasons set out hereafter.

THE THIRD PARTIES (RIGHTS AGAINST INSURERS) ACT 2010

Section 1 of the 2010 Act provides:

“ Rights against insurer of insolvent person etc

(1) This section applies if—

(a) a relevant person incurs a liability against which that person is insured under a contract of insurance, or

(b) a person who is subject to such a liability becomes a relevant person.

(2) The rights of the relevant person under the contract against the insurer in respect of the liability are transferred to and vest in the person to whom the liability is or was incurred (the “third party”).

(3) The third party may bring proceedings to enforce the rights against the insurer without having established the relevant person's liability; but the third party may not enforce those rights without having established that liability.

(4) For the purposes of this Act, a liability is established only if its existence and amount are established; and, for that purpose, “establish” means establish—

(a) by virtue of a declaration under section 2 or a declarator under section 3,

(b) by a judgment or decree,

(c) by an award in arbitral proceedings or by an arbitration, or

(d) by an enforceable agreement.

(5) In this Act—

(a) references to an “insured” are to a person who incurs or who is subject to a liability to a third party against which that person is insured under a contract of insurance;

(b) references to a “relevant person” are to a person within sections 4 to 7 [(and see also paragraph 1A of Schedule 3)];

(c) references to a “third party” are to be construed in accordance with subsection (2);

(d) references to “transferred rights” are to rights under a contract of insurance which are transferred under this section.”

Section 2 of the Act provides:

“Establishing liability in England and Wales and Northern Ireland

(1) This section applies where a person (P)—

(a) claims to have rights under a contract of insurance by virtue of a transfer under section 1, but

(b) has not yet established the insured's liability which is insured under that contract.

(2) P may bring proceedings against the insurer for either or both of the following—

(a) a declaration as to the insured's liability to P;

(b) a declaration as to the insurer's potential liability to P.

(3) In such proceedings P is entitled, subject to any defence on which the insurer may rely, to a declaration under subsection (2)(a) or (b) on proof of the insured's liability to P or (as the case may be) the insurer's potential liability to P.

(4) Where proceedings are brought under subsection (2)(a) the insurer may rely on any defence on which the insured could rely if those proceedings were proceedings brought against the insured in respect of the insured's liability to P.

(5) Subsection (4) is subject to section 12(1).

(6) Where the court makes a declaration under this section, the effect of which is that the insurer is liable to P, the court may give the appropriate judgment against the insurer.

(7) Where a person applying for a declaration under subsection (2)(b) is entitled or required, by virtue of the contract of insurance, to do so in arbitral proceedings, that person may also apply in the same proceedings for a declaration under subsection (2)(a).

(8) In the application of this section to arbitral proceedings, subsection (6) is to be read as if “tribunal” were substituted for “court” and “make the appropriate award” for “give the appropriate judgment”.

(9) When bringing proceedings under subsection (2)(a), P may also make the insured a defendant to those proceedings.

(10) If (but only if) the insured is a defendant to proceedings under this section (whether by virtue of subsection (9) or otherwise), a declaration under subsection (2) binds the insured as well as the insurer.

(11) In this section, references to the insurer's potential liability to P are insurer's liability in respect of the insured's liability to P, if established.”

THE POLICY

The relevant terms of the Policy are:

“ SECTION B PUBLIC AND PRODUCTS (including inefficacy) LIABILITY

DEFINITIONS to Section B

…

8 Liability

Liability means legal liability to pay damages including interest and claimant costs recoverable from you in respect of or as a result of:

8.1 accidental bodily injury to any person other than an employee

8.2 accidental damage caused by you or your employees or sub-contractors to property other than property belonging to you or in your custody, possession or control

8.3 accidental damage or bodily injury caused by deliberate acts of your employees or sub-contractors

8.4 accidental personal injury,

8.5 accidental advertising injury

8.6 accidental denial of access

occurring during the period of insurance in connection with any occurrence which is or may be the subject of indemnity under this Section.

…

19 Criminal acts

We will indemnify you for your liability to pay damages including interest and claimants costs recoverable from you as a result of bodily injury or damage in respect of criminal acts of arson, theft, malicious damage, assault, fraud, dishonesty or embezzlement by your employees provided that the events insured by this clause:

19.1 were committed during the period of insurance, and

19.2 arose in connection with a contract with a customer.

…

COVER

We will indemnify you up to the limit of indemnity against liability incurred by you during the period of insurance arising out of and in the course of business within the territorial limits.

…

CLAIMS CONDITIONS

The following Conditions 1–10 must be complied with after an incident that may give rise to a claim under your policy. Breach of these conditions will entitle us to refuse to deal with the relevant claim.

…

2 Writ, summons, etc

You must not respond to any letter, writ or summons or other document sent to you in connection with any accident, incident or occurrence that may relate to any claim under your policy or which may give rise to a claim under any Section of your policy. You must immediately send them to Sutton Specialist Risks Ltd unanswered by return of post, or to us or legal representatives as may otherwise be advised...