P (A Child) v Royal London Mutual Insurance Society Ltd

In an insurance exclusion for liabilities arising from wilful, malicious or criminal acts, “wilful” does not mean every deliberate act. Its meaning depends on the policy context. Read with “malicious” and “criminal”, it denotes blameworthy conduct.

An act is wilful where the insured deliberately intends damage of the relevant kind, or acts recklessly. Recklessness requires awareness that the act risks such damage, or indifference to whether it does, followed by proceeding with the act. The exclusion does not require an intention to cause the damage, but mere stupidity without awareness of, or indifference to, the risk is insufficient.

Ronson alleged that a fire started by the respondent, then aged 11, and another child destroyed stock at Waterside Mill. The respondent was insured under his mother’s household contents policy. Its personal-liability extension covered accidental property damage but excluded claims and liabilities arising from wilful, malicious or criminal acts.

His Honour Judge Seymour QC, sitting in the Queen’s Bench Division, held that “wilful” required damage deliberately caused and consciously intended. He rejected the insurer’s late-notification defence. Royal London appealed only the construction of the exclusion.

The central issue was whether the child’s deliberate lighting of a fire was a wilful act despite his asserted lack of intention or awareness that it could burn down the mill.

Appeal dismissed. Lord Justice Tuckey, with whom Lord Justice Thomas and Lady Justice Hallett agreed, held that the judge’s construction of “wilful” was too narrow, but that the exclusion did not apply on the facts found.

1. The policy gave broad cover for legal liability arising from incidents resulting in accidental property damage. If “wilful” simply meant deliberate, the exclusion would remove much of that cover because negligent acts are commonly deliberate acts performed incompetently.

2. In the phrase “wilful, malicious or criminal acts”, the latter two adjectives coloured the meaning of “wilful”. The phrase concerned the quality of the act and the actor’s state of mind. It therefore required conduct that was blameworthy, rather than a merely intentional physical act.

3. An act deliberately intended to cause the relevant damage was plainly wilful. However, intention to cause that damage was not required. For this exclusion, a person acted wilfully if he acted recklessly: he knew that what he proposed to do risked damage of the kind claimed, or did not care whether there was such a risk, and nevertheless proceeded.

4. The respondent’s statement showed neither awareness that the fire risked burning down the mill nor indifference to that possibility. His conduct could be described as stupid, but not reckless. It was consequently not wilful for the purposes of the exclusion. The insurer remained unable to rely on the exclusion.

The court accordingly affirmed the result below while substituting a broader construction of “wilful”.

• Court of Appeal (Civil Division): Dismissed Royal London’s appeal. It held that the judge’s construction of “wilful” was too narrow, but that the exclusion still did not apply.
• High Court, Queen’s Bench Division: His Honour Judge Seymour QC held that “wilful” meant damage deliberately caused and consciously intended, and rejected the late-notification defence. The lower-court citation was not stated in the judgment.