Khanna v Prosperity Life Assurance Ltd & Ors

For an incapacity policy, the insured need not prove that one medical condition was the sole cause of incapacity. It is sufficient to establish, on the balance of probabilities, that the condition made a material contribution to the incapacity at the relevant time. The assessment of a condition such as obstructive sleep apnoea must take account of the individual patient and the whole clinical picture, rather than measurable events alone. A trial judge must give reasons sufficient to explain the result, but the extent of that duty depends on the subject matter and the issues actually material to the decision. An appellate court will not invalidate a judgment for omissions that do not affect the essential reasoning or result.

Dr Satish Khanna claimed under policies of insurance against disability or incapacity from medical practice. He retired in November 1994 after suffering disturbed sleep, choking episodes, daytime symptoms and cognitive impairment. The insurers disputed the diagnosis of obstructive sleep apnoea and argued that, in any event, the condition was sufficiently controlled by CPAP treatment.

Mr Justice Eady found that obstructive sleep apnoea had made a material contribution to Dr Khanna’s incapacity and that he remained unfit for relevant work. The insurers appealed, challenging the evaluation of conflicting expert evidence, the treatment of the Birmingham sleep-study results, and the adequacy of the judge’s reasons.

1. Appeal dismissed. The Court of Appeal unanimously upheld the judge’s conclusion that obstructive sleep apnoea had made a material contribution to Dr Khanna’s disability and incapacity.
2. The relevant inquiry was whether Dr Khanna suffered from obstructive sleep apnoea at the time of retirement and whether it materially contributed to the incapacity causing retirement. Sole causation was unnecessary. The judge had applied the civil standard of proof.
3. The diagnosis had to be assessed in the light of the individual patient. It was not necessary to determine the condition solely by counting measurable apnoea or hypopnoea events. Choking episodes that woke the patient, the absence of another convincing explanation, and improvement following CPAP were capable of supporting the diagnosis. The later Birmingham tests did not compel a different conclusion.
4. The court considered the duty to give reasons discussed in Flannery v Halifax Estate Agencies Ltd [2000] 1 WLR 377. That duty required the judge to engage with the competing expert evidence and explain the preference reached, but its extent depended on the nature of the dispute. Unlike the judgment criticised in Flannery, the judge had explained the central reasoning and addressed the material issue.
5. The judge could have given fuller reasons concerning the apnoea/hypopnoea index, arousal figures, the effects of CPAP and daytime somnolence. Those deficiencies did not invalidate the judgment because the omitted matters were not material in the light of the evidence accepted. The appeal was dismissed with costs, and permission to appeal to the House of Lords was refused.

• Court of Appeal (Civil Division): Appeal from the decision of Mr Justice Eady in the Queen’s Bench Division dismissed with costs. Application for permission to appeal to the House of Lords refused.