Gwilliam v West Hertfordshire Hospitals NHS Trust

An occupier who invites the public to use potentially hazardous entertainment remains under the common duty of care even where the equipment is supplied and operated by an independent contractor. The independent contractor’s status does not remove the duty; it concerns whether the occupier has discharged it.

In a fact-specific case, reasonable care may require the occupier to make reasonable inquiries about the contractor’s competence, including whether the contractor is insured. The duty does not ordinarily require inspection of the insurance policy itself. A reasonable contractual assurance that insurance will be in place may suffice. The claim was not merely one for pure economic loss.

The claimant was injured at a fundraising fair organised on hospital premises when a negligently assembled amusement apparatus supplied and operated by an independent contractor caused her injury. She settled her claim against the contractor for £5,000 and pursued the hospital for the shortfall said to have resulted from the contractor’s lack of valid public liability insurance.

The Watford County Court held that the hospital owed no relevant duty, applying Caparo Industries Plc v Dickman [1990] 2 AC 605. The claimant appealed. The central issues were whether the hospital owed a duty under the Occupiers Liability Act 1957, whether that duty had been breached, and whether the claim was one for economic loss.

1. Appeal dismissed. The hospital remained an occupier of the premises and owed the claimant the common duty of care under sections 2(1) and 2(2) of the Occupiers Liability Act 1957. The claimant’s permission to attend extended to using the entertainment provided at the fair.
2. Section 2(4), including section 2(4)(b), concerns whether the common duty has been discharged, not whether a duty exists. The fact that the apparatus was supplied and operated by an independent contractor therefore did not extinguish the hospital’s duty.
3. The hospital could discharge its duty by selecting an appropriate and competent independent contractor. Competence had to be assessed in light of the task, including the contractor’s experience and reliability. On these facts, where the contractor had been selected from a telephone directory and had no other established credentials, reasonable care required an inquiry into public liability insurance. Insurance was relevant both to the contractor’s ability to meet a claim and to its suitability to be entrusted with the apparatus.
4. The hospital was not required to inspect the insurance policy or verify every term of cover. The evidence supported the finding that the hospital had made a contractual arrangement for insurance and had no reason to believe that cover was not in force. The duty was therefore discharged.
5. The Lord Chief Justice held that the claim was not properly characterised as one for pure economic loss. Any recoverable loss would be loss connected with personal injury, although proof of the amount remained necessary. Lord Justice Waller agreed that the appeal failed because the hospital had acted reasonably.
6. Lord Justice Sedley concurred in the result but dissented on the duty. He considered that requiring occupiers to check contractors’ insurance was a substantial and potentially expansive development of negligence law. He would also have held that the telephone inquiry was insufficient to discharge such a duty.

The court ordered that the appeal be dismissed with costs, subject to the agreed order lodged with the court.

• Court of Appeal: Appeal from the decision of His Honour Judge Roger Connor sitting at Watford County Court. The Court of Appeal dismissed the appeal.