Ronson International Ltd v Patrick
| Jurisdiction | England & Wales |
| Judgment Date | 06 July 2005 |
| Neutral Citation | [2005] EWHC 1767 (QB) |
| Docket Number | Case No: HQ03X01608 |
| Court | Queen's Bench Division |
| Date | 06 July 2005 |
[2005] EWHC 1767 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
St Dunstan's House
133–137 Fetter Lane
London EC4A 1HD
His Honour Judge Richard Seymour QC
(Sitting as a Judge of the High Court)
Case No: HQ03X01608
Peter Irvin (instructed by Cooper Sons Hartley & Williams) for the Part 20 claimant
Digby Jess (instructed by Keoghs) for the Part 20 defendant
John Russell held a noting brief on behalf of the claimant
APPROVED BY THE COURT FOR HANDING DOWN
HH Judge Richard Seymour QC:
Introduction
At Hadfield in Derbyshire is an old mill, Waterside Mill ("the Mill"), which by 1997 had ceased to be used as a mill. It seems that part of it was derelict, but that other parts had been adapted for a variety of commercial uses. In that guise the whole was called "Waterside Mill Complex". One of the occupiers of a part of the Mill was a company called Allpack Ltd ("Allpack"). The business of Allpack consisted in repackaging goods for a number of customers. For the purposes of that business Allpack occupied some 23,000 square feet of warehouse space at the Mill.
One of the customers of Allpack was the claimant company, Ronson International Ltd ("Ronson"). Ronson seems to have carried on a mail order business of some sort.
Some time between about 17.30 hours and 18.41 hours on Tuesday, 27 May 1997 the Mill caught fire. The premises of Allpack were extensively damaged. It is Ronson's case in this action that stock belonging to it to the value of some £845,956 was destroyed in the fire.
The defendant and Part 20 claimant in this action is Mr Christopher Patrick. Mr Patrick was born on 29 October 1985, so he is now aged 19 years. At the time of the fire at the Mill on 27 May 1997 Mr Patrick was aged 11 years.
Mr Patrick does not dispute that on the day of the fire he had been playing in a derelict part of the Mill with a friend, John Swann. Following the fire Mr Patrick and his friend were arrested and charged with arson, contrary to the provisions of Criminal Damage Act 1971, s 1(1) and (3). In the event, by letter dated 8 January 1998 to his solicitors, Cooper Sons Hartley & Williams ("CSHW"), Mr Patrick was informed by the Crown Prosecution Service that the Crown intended to offer no evidence against him. Thus the prosecution was not pursued.
Mr Patrick made a witness statement for the purposes of the present trial. In it he said, quite understandably, that he could not recall the events of 27 May 1997 in any detail and that he relied on the accounts which he had given at the time. One of those accounts, given, I think, to his own solicitors in the form of a proof of evidence, was to this effect:
"On Tuesday 27 May I got up and I went to call for John at his house. He lives close by. It was a nice day and we decided to go for a ride on our bikes. We were going on the Longendale Trail which is an organised bike ride near Hadfield. The Trail was well known in the Hadfield area and after we had been for our ride we rode near to the Reservoir on to near the Waterside Mill. By this time it was about lunch time.
When we got to the Mill we were just messing about. I can remember there was a fire of rubbish but we just ignored it.
We found some shredded paper which we made into a pile and set fire to. The fire went out. We then left the Mill and went to Abduls to b[u]y another box of matches. We returned to the Mill later in the afternoon. We decided that we were going to build a den in the corner of the Mill. We did this by placing pallets up against the wall and putting a pallet on top. We sat inside the den smoking for a short time and talking. At no time whilst we were in the den did we discuss burning down the Mill.
We came out of the den and set fire to the paper that was inside the den with a view to setting fire to the den itself. At no time did I think that this fire would lead to the whole Mill being burnt down.
I did not think that anybody would mind us setting fire to the paper and pallets as I thought that they were just rubbish that had been abandoned. It took us approximately half an hour to build the den. Whilst the den was still burning we decided to leave. When we had left I shinned up a lamp post to have a look at what the fire was doing. By that time it was smaller and most of the flames had died down. I noticed a pipe was running at the top of the building and it was rusty. I asked John if he wanted to go back to the fire but he said he did not. I asked him a couple of times but I did not say that he was mardy. He then ran off and I followed him. We then went to my home and then to John's home."
It is the case of Ronson in this action that the fire which Mr Patrick accepts he and John Swann started in the den built in the derelict part of the Mill spread to the part occupied by Allpack, and thus was the cause of the destruction of the stock on Allpack's premises which belonged to it. It is right to say that while that is the conclusion reached in a fire investigation report ("the DFRS Report") prepared by Divisional Officer Shaw, Station Officer Nicholson and Station Officer Crayon of Derbyshire Fire and Rescue Service and also the conclusion reached by a Mr Adrian Downey, a forensic scientist, in a statement dated 28 July 1997 made in the context of the anticipated prosecution of Mr Patrick and John Swann, some statements also made for that purpose, specifically those of PC Lannigan and PC Rusholme, who were the first police officers on the scene of the fire, recorded finding traces of other fires at the Mill. It is not necessary for me in this judgment to reach any conclusion as to whether the fire lit by Mr Patrick and John Swann was in fact the cause of the fire which destroyed the premises occupied by Allpack at the Mill, and I do not do so. It is also unnecessary for me to reach any conclusion as to whether Ronson had any stock on Allpack's premises at the time of the fire or, if so, how much. Again I make no findings on those questions.
The insurance policy
At the time of the fire Mr Patrick lived with his mother, Karen Pledger, and his stepfather at 8, Mason Grove, Hadfield. Karen Pledger had entered into a policy of insurance ("the Insurance Policy") numbered F30325558C with United Friendly Insurance plc ("United Friendly"). The period of cover provided under the Insurance Policy was from 23 September 1996 to 31 October 1997. The Insurance Policy was variously described as a "House and Home" or "Four Walls Home Contents" policy. However, by Extension E8 the cover afforded by the Insurance Policy included, so far as is presently material:
"Household and personal liabilities
All persons insured are covered for legal liabilities arising as occupiers of your home (and not as owners) and in a personal capacity from incidents occurring in the British Isles or whilst on holiday abroad during the currency of this policy resulting in:
(a) …
(b) accidental damage to property neither belonging to nor in the custody or control of those insured under this section.
EXCLUDING claims and liabilities arising from:
…
(viii) any wilful, malicious or criminal acts …"
In Section 1 of the Insurance Policy, in part A, those insured under the policy were said to be:
"You and any member of your immediate family permanently residing with you whose property is not otherwise insured."
In the Insurance Policy the expressions "policyholder/you/your" were defined as meaning "the person(s) named in the schedule", which in this case was Karen Pledger in the name Mrs K Patrick. The definition of the expression "immediate family" for the purposes of the Insurance Policy included "children".
The Insurance Policy included General Exclusions and Conditions ("the General Conditions"). By condition 1 of the General Conditions it was provided that:
"It is a condition of this policy that all of its terms and conditions are observed."
Condition 4 of the General Conditions dealt with the claims procedure. Condition 4(iii) was in these terms:
"We must be given written notice immediately you are aware of any incident involving third party injury or damage for which you might be held responsible or if any claim has been made against you by a third party. Any letter, writ or other document must be enclosed in order that we may protect your interests if the claim falls within the terms of cover. You must not admit liability or agree any payment to a third party."
The Part 20 defendant
The Part 20 defendant is Royal London Mutual Insurance Society Ltd ("Royal London"). By a scheme under the Insurance Companies Act 1982 approved by the Companies Court on 11 December 2000 the liabilities of United Friendly were transferred to Royal London with effect from 1 January 2001.
The claims
It was common ground that, potentially at least, Mr Patrick was entitled to indemnity under Extension E8 of the Insurance Policy in respect of any claim made against him in respect of the consequences of the fire on 27 May 1997 at the Mill, provided that none of the exclusions applicable to that extension was relevant and that all relevant policy conditions had been complied with.
It was also common ground that neither he nor anyone on his behalf gave notice of the possibility of any claim until about 28 August 1998. The notification then given came about in this way. Another occupier of premises at the Mill on 27 May 1997 was a company called HB Knitting. Cunningham UK Ltd. ("Cunningham"), loss adjusters acting on behalf of the insurers of HB Knitting wrote a letter dated 17 August 1998 to "The Parents/Guardian of C R Patrick" in which, having stated its interest, Cunningham went on:
"The evidence available indicates Master...
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