Blackburn Rovers Football & Athletic Club Plc v Avon Insurance Plc & Ors

An insurance exclusion must be applied by reference to causation. A pre-existing degenerative condition need not be abnormal before it can be relevant; normal degeneration is not automatically disregarded. The condition must, however, have caused the insured disablement, at least as a causa sine qua non. If an accident would have disabled the insured regardless, a condition that merely increased the severity or extent of the disability has no causal effect on disablement, so the exclusion does not apply. Whether degeneration caused the injury is ordinarily a matter for factual and expert medical evidence. Policy wording must be construed in its commercial context, subject to the ordinary rules concerning absurdity and ambiguity.

The insured football club claimed under a personal accident and illness policy for the disabling back condition of its player, Martin Dahlin. The insurers relied on an exclusion for permanent total disablement attributable directly or indirectly to arthritic or other degenerative conditions.

On a preliminary issue, Moore-Bick J held that the exclusion had a rational meaning and construed it as covering degenerative conditions sufficiently severe to amount to an illness, rather than conditions reflecting normal ageing: [2004] EWHC 2625 (Comm). The appeal concerned whether ordinary age-related degeneration should be disregarded and how the exclusion’s causation wording should operate.

The Court of Appeal allowed the appeal and declared that degenerative changes typical of men of the player’s age, including those typical of top-class professional footballers, were not to be disregarded for the purposes of the policy.

1. Construction. The court accepted the principles derived from Yorkshire Water Services Ltd v Sun Alliance and London Insurance PLC [1991] 2 Lloyds Rep 21: policy words are given their ordinary meaning in the context of the policy as a whole and with regard to commercial sense; an absurd or manifestly unintended literal construction may be rejected if an alternative construction does not do violence to the language; and ambiguity may be resolved contra proferentem. The court also adopted the contextual approach expressed in Charter Reinsurance Co. Ltd v Fagan and Others [1996] 2 Lloyd’s Rep. 113.
2. Causation. The lower court had proceeded on the basis that any causal contribution by a degenerative condition would satisfy the words attributable directly or indirectly. That was incorrect. The condition must at least be a causa sine qua non of the disablement. If the accident would have disabled the player without the pre-existing condition, the condition has no causative effect on the fact of disablement, even if it increased its extent or severity.
3. Normal degeneration. There was no principled reason to construe the exclusion as automatically inapplicable to normal degeneration. If such degeneration can cause disc injury and disablement, its normality does not by itself prevent the exclusion from applying. Conversely, if it does not ordinarily cause such injury, the factual and medical evidence may show that it was not a cause in the particular case. Evidence concerning the frequency of disabling disc prolapse among professional footballers could assist that assessment.

The court did not finally determine the medical causation issue or whether the particular degeneration fell within the wording of the exclusion. Those matters remained for determination on the evidence.

1. Court of Appeal (Civil Division) allowed the insurers’ appeal and directed that the preliminary question receive a negative answer: [2005] EWCA Civ 423.
2. High Court of Justice, Queen’s Bench Division, Moore-Bick J determined the construction of the insurance exclusion as a preliminary issue and held that it covered degenerative conditions sufficiently severe to amount to an illness: [2004] EWHC 2625 (Comm).