Chief Akinpeninu Iyanda & Ors V. Chief Afolabi Laniba Ii (Baale Awe) & Ors (2002) LLJR-CA

Chief Akinpeninu Iyanda & Ors V. Chief Afolabi Laniba Ii (Baale Awe) & Ors (2002)

LawGlobal-Hub Lead Judgment Report

ONALAJA, J.C.A

The plaintiffs for themselves and on behalf of Awe Community, commenced and issued a writ of summons in a representative capacity for themselves and on behalf of Awe Community against the defendants, jointly and severally. After service of the writ of summons on the defendants, they entered appearances and had a joint legal representation. Pleadings were filed, exchanged, delivered and amended with trial concluded on the amended pleadings, which are referred to as statement of claim, statement of defence and counterclaim, reply to statement of claim and defence to counter-claims.

In paragraph 43 of the statement of claim, the plaintiffs claimed as follows:-

“43. Wherefore the plaintiffs claim against the defendants:-

(i) Forfeiture of the customary tenancy of the defendants on the land in dispute for the denial of the plaintiff’s right on the land and for misconduct;

(ii) Declaration that the plaintiffs are the persons entitled on behalf of the Awe Community, to a declaration of a customary right of occupancy in respect of all that piece/parcel of land situate, lying and being at Eleranko Area, Awe, along Awe-Iwo Road, and shown on draft plan No. AAY 1645, attached herewith, marked exhibit A and shown thereon edged blue;

(iii) Possession of the said land in dispute;

(iv) N50,000.00 being damages for trespass, committed by the defendants on the said land, sometime in January, 1985, or there about, after their tenancy had been terminated by notice and by their act of claiming to be owners of the land in dispute and of uprooting plaintiff’s trees on the land in dispute, leaving the land and such like acts of trespass still continues and for misconduct.

(v) Injunction to restrain the defendants, their servants and/or agents and all others howsoever, who come to the land through them from in anyway coming to the land or in any way disturbing the plaintiff’s possession or right to possession of the land or from committing further acts of trespass on the land in dispute.

In accordance with the High Court Rules of Oyo State, the defendants set up a counter-claim as follows in paragraph 34, in their statement of defence and counter-claim; whilst in paragraph 33 of their statement of defence and counter-claim they particularised and itemised the sum of N50,000.00, claimed as special and general damages:-

“33.

Special Damages N

(1)(a) Treatment of the defendants and defendant’s dependants at

the Iwo General Hospital and purchase of drugs and medicine;- 500.00

(b) Property of the defendant’s dependants destroyed by the plaintiff’s agents and servants -2,000.00

(c) Economic trees of the defendants destroyed by the plaintiffs’ agents and servants- 22,500.00

c/f N25,000- b/f N25,000 (2) General damages-N25.000 Grand Total- N50,000.00

(34(i) Declaration that the defendants are the persons entitled to a customary right of occupancy in respect of the land in dispute and including the other area of land, not in dispute as shown in survey plan No. RBDS/OY/334/88 dated 2nd April, 1988;

(ii) N50,000,00 special and general damages for trespass committed on the land by the plaintiffs, by claiming to be the owners of the land in dispute and by the wanton destruction by the plaintiff’s agents and servants of the defendants’ economic tree crops and property.

(iii) Perpetual injunction restraining the plaintiffs, their servants, agents or privies from disturbing the defendant’s possession or from committing further acts of trespass on the land in dispute.”

The 2nd and 3rd plaintiffs together with other 11 witnesses testified for the plaintiffs to substantiate plaintiff’s claim and defence to the counter-claim, The plaintiff’s witnesses were subjected especially the 6th, 7th and 8th plaintiff’s witnesses to very copious and rigorous cross-examination by the learned Counsel to the defendants as reflected in the printed records of appeal. The 1st and 3rd defendants testified for the defendants in defence of the claim against them and to substantiate the counter-claim, whilst they called 10 other defence witnesses to support the defence and the counterclaim.

All the defendants, who testified and their witnesses were similarly rigorously cross-examined. In the course of trial, documentary evidence were admitted and marked as exhibits. Reference shall be made to the documents where necessary in this judgment.

Upon completion of trial the learned Counsel to the parties gave impressive and well researched addresses before the learned trial Judge who delivered his well considered judgment at pages 114 to 188 of the record of appeal wherein he gave judgment in part in favour of the plaintiffs whilst he dismissed in its entirety the counterclaim.

The defendants being dissatisfied with the judgment filed a notice of appeal reflected at page 189 of the record of appeal. The omnibus ground was the only ground of appeal raised in the said notice of appeal. With the leave of this court, defendants henceforth, referred to in this judgment as appellants filed amended 11 grounds of appeal No. 2. In accordance with the rules of this court, they furnished the particulars to the grounds of appeal. The amended grounds of appeal No. 2 was served on the plaintiffs, who are hereinafter referred to in this judgment, as respondents.

The notice of appeal and amended grounds of appeal filed by appellants were served on respondents. Based upon them with the leave of this court, appellants filed an amended appellant’s brief of argument wherein, it set out all the amended grounds of appeal except ground 2, which is hereby deemed to have been abandoned.

In compliance with the rules of brief writing, appellants raised 7 issues for determination in this appeal which for ease of reference are set down as follows:- Page 5 paragraph or chapter C:

Issues for Determination

  1. Whether the public documents O, P, Q and R are not conclusive proof of the fact that the land in dispute originated from the Oluwo, the Suzerain of Iwo and that the relevant weight of the exhibits would have proved for certain that, the land belonged to the Oluwo and therefore, was under Iwo Local Government and so the court lacked jurisdiction to try the matter as at the time the Osogbo Judicial Division had jurisdiction over matters affecting Iwo Local Government. Exhibits R and Q, having been tendered in evidence is conclusive proof of the Oluwo’s title.
  2. Whether in the light of the evidence, the plaintiffs had locus standi to institute the action, Awe being an area under Oyo Local Government and the claim of the plaintiff’s raising a boundary dispute between the Oyo and Iwo Local Government Councils.
  3. Whether a witness summoned to tender documents under section 191 of the Evidence Act, need give any further oral evidence in explanation of the documents tendered.
  4. Whether in the light of all the evidence at the trial both documentary and oral the provision of section 45 of the Evidence Act, does not enure to the benefit of the defendants and whether the decision was justified considering the totality of the evidence against the plaintiff’s claim to ownership of the land.
  5. Whether hunting lights without conclusive evidence of payment of Ishakole, without more amounts to ownership of the land.
  6. Whether relief from forfeiture should not have been granted.
  7. Whether the learned trial Judge ascribing wrongly a statement made by the plaintiffs in their statement of claim to the defendant’s counsel, did not lead to a miscarriage of justice.

It is pertinent to note that, the appellant’s 7 issues for determination were ominously silent as to which amended grounds of appeal they were based or to which they correlate. In arguing the issues, appellants failed to relate or connect the issues to the grounds of appeal. Though, an issue under the rules of brief writing may encompass one, or two or three grounds of appeal in one issue, but it is incompetent and inelegant to formulate more issues than the grounds of appeal as the appellate courts deprecate and frown on proliferation of issues more than the grounds of appeal. The amended appellant’s brief was served on respondents, who filed amended brief of argument.

At page three of respondent’s amended brief of argument in paragraph 5.1 to 5.5 respondents raised and gave notice of preliminary objection to strike out in particular grounds 2 and 9 of the amended grounds of appeal number 2 and the arguments based on them. Respondents concluded that in the event, the court overrules the objections the respondents will proceed to treat the issues as follows:-

Prior to paragraph 5 at page 3 of respondents’ amended brief of argument in paragraph 4 at page 3 of respondents amended brief of argument raised the underlisted issues arising in this appeal:-

  1. Issues arising in this appeal.

4.1 The only issues arising from the grounds of appeal are as follows:-

(i)What is the role expected of a witness subpoenaed under section 192 or193 of the Evidence Act?(covers ground2)

(ii) Whether the defendant’s evidence was sufficient to sustain their root of title traced to an alleged grant by a past Oluwo of Iwo? (covers grounds 1, 3,4 and 10)

(iii) Whether there was sufficient evidence before the lower court to justify the granting of the plaintiff’s claims?(covers grounds 5, 6, 7 and 8)

(iv) Whether the learned trial Judge properly identified the author of the statement that the defendants were initially happy with the proposal to use the land in dispute? (covers ground 9)

As the preliminary objection was raised in respondent’s brief of argument, appellants replied in chapter paragraphs 1.5 to 2.4 appellant’s reply brief at pages 2 to 5 of the said reply brief concluded in paragraph 2.4 thus:-

“On the whole, the objections of the respondents are highly misconceived and should be dismissed as they all amount to an attempt to defend the indefensible…. consider the totality of what is advanced by the appellants and do substantial justice instead of relying on technicalities alone.”

After careful arguments by respondents at pages 3 – 5 of respondent’s brief of argument and pages 2 – 5 in appellant’s reply brief, it is better and more prudent to consider the preliminary objection in the argument raised on the issues by appellants and respondents in their briefs of argument, which was rightly anticipated by respondents in paragraph 6.1 respondent’s brief of argument reflected above in this judgment.

Issues 1 and 2, amended appellant’s brief of argument raised the issue of locus standi of respondents and that Oyo High Court lacked jurisdiction as the land in dispute, fell within Iwo Local Government as shown in:

“(a) Exhibit ‘O’ Oyo State Local Government Map.

(b) Exhibit ‘P’ Iwo Local Government Area Map.

(c) Exhibit ‘Q’ Western Region of Nigeria Public Notice No. 61 of 1953.

(d) Exhibit ‘R’ Map of Oba Hills Forest Reserve.”

And the proper jurisdiction is the lex situs of the land as provided in High Court (Civil Procedure) Rules of Oyo State, with the venue then being Osogbo High Court and not Oyo High Court.

It is trite law that, once the issue of the locus standi and jurisdiction of the court is raised even for the first time in this court or the Supreme Court, the issue must be resolved first before taking any other step, as it is basic and fundamental to the action filed, Egolum v. Obasanjo (1999)7 NWLR (Pt. 611 ) page 355 SC; Nnubia v. A.-G., Rivers State (1999) 3 NWLR(Pt. 593) page 82 CA, Owodunni v. Registered Trustees of CCC (2000) 10 NWLR (Pt. 75) 675 Sc.

These issues of locus standi and jurisdiction of respondents were raised in the lower court and the learned trial Judge stated as follows at pages 169, 170 and 171 of the record of appeal:-

“I think there is the need to mention, to begin with, that it seems difficult to understand the basis for the submission of Dr. Aremu, learned Counsel for the defendants to the effect that the plaintiffs have no locus standi to institute the present action. It is quite possible, as contended by the learned Counsel that the set of facts disclosed in this case could give rise to a boundary dispute between the Oyo Local Government (now Afijio Local Government) and Iwo Local Government. But, even if this was possible. I do not see what could prevent the plaintiffs, their rights were affected, from instituting this action either as co-plaintiffs with the Oyo Local Government (now Afijio Local Government) or independently on their own. It is well known that a person seeking relief from the court must show that he has locus standi in the case in the sense that his legal rights have been or are in imminent danger of being invaded and in consequence, he has suffered or is likely to suffer injuries over and above those suffered by the public generally. A person who can show that he has suffered or is likely to suffer more injuries over and above those suffered by the public generally could therefore not be said to have no locus standi in the matter. (See Gamioba & Ors. v. Esesi II & Ors. (1961) ALL NLR 584; Adesanya v. President of the Federal Republic of Nigeria & Anor. (1981) 5 SC 112 at page 161, and Thomas v. Olufosoye (1986) 1 NWLR 669).

The plaintiffs in this case, representing Awe Community, have claimed that they have proprietary rights and interests in the land in dispute which the defendants are alleged to be occupying wrongly. To that extent, the plaintiffs have shown that the injuries likely to be suffered by them are more than could be suffered by the public generally. I therefore, hold that they have locus standi in this matter and they are proper plaintiffs in this action.

The defendants have indicated in paragraph 25 of their statement of defence and counter-claim that they were going to raise as a preliminary point of law, the issue as to whether this court has jurisdiction to adjudicate on this action since the land in dispute is outside the court’s jurisdiction. There is nothing on the court’s record to show that this point was ever taken up as a preliminary issue. It certainly was not taken up immediately before the trial of this case commenced.

Furthermore, Dr. Aremu, learned Counsel for the defendants, did not make any clear submission on this point in the course of his address. It would suffice, however, to say that no cogent evidence was adduced in the course of the trial to show that the land in dispute was outside the territorial jurisdiction of this court. The evidence of the 2nd D.W., who was called to testify on this point and who in the process, tendered the Local Government map of Oyo State as at 1985 (exhibit O), was not of much assistance in that he could not say categorically in which Local Government the land in dispute and the villages whose names have featured prominently in this case would fall. The name of the villages, apart from Kiyeseni were not reflected on the map (exhibit O); neither was Eleranko stream which the plaintiffs have claimed to be the boundary between their land and Iwo people’s land reflected on the plan exhibit O. Similarly, the 3rd D.W who was also called to testify on this point, merely dumped on the court, what he called the map of Iwo Local Government Area (exhibit P) without being able to explain anything reflected in the said plan. This is not surprising, since the 3rd D.W. was a Clerical Officer and not a surveyor in Iwo Local Government Secretarial and did not possess any skill in map reading. In any event, a close scrutiny of the map shows Kiyeseni as being within Iwo Local Government Area whereas the defendants in paragraph II of their statement of defence the boundary between Iwo and Oyo Local Governments is at Kiyeseni which is said to be about 2 kilometers from the land in dispute when going from Iwo to Oyo. No where in the map (exhibit P) was Eleranko stream which had featured prominently in this case mentioned. I have no difficulty in coming to the conclusion that both maps exhibits O and P, tendered by the defendants have been of very little value in determining whether or not the land in dispute falls outside the jurisdiction of this court, therefore, hold that this court has jurisdiction to entertain the present suit.” (The italics are mine).

The nature of locus standi of a plaintiff (respondent in this appeal) is a threshold question and what constitutes locus standi of plaintiff was expatiated upon by the Supreme Court in the case of Josiah Kayode Owodunni v. Registered Trustees of Celestial Church of Christ & 3 Ors. (Joined by order of court dated December 1st, 1989, as defendants to counter-claim) (2000) 10 NWLR (Pt. 675) page 315 and held by Supreme Court as follows:-

  1. On denotation of locus standi-

The term locus standi (or standing) denotes the legal capacity to institute proceedings in a court of law. (P. 338, para. E)

  1. On nature of issue of locus standi –

Locus standi is unquestionably a threshold issue. (P. 357, paras. F-G).

  1. On whether locus standi is dependent on merits of a case and treatment of case where plaintiff lacks locus- Standing to sue is not dependent on the success or merits of a case but on the showing of the plaintiff’s case in his statement of claim. It is a condition precedent to a determination on the merits. It follows therefore, that if the plaintiff has no locus standi or standing to sue, it is not necessary to consider whether there is a genuine case on the merits; his case must be struck out as being incompetent. (Momoh v. Olotu (1970) 1 ALL NLR 117; Bolaji v. Bamgbose (1986) 4 NWLR (Pt. 37) 632; Adesanya v. The President (1981) 5 SC 112; Adefulu v. Oyesile (1989) 5 NWLR (Pt. 122) 377; Odeneye v. Efunuga (1990) 7 NWLR (Pt. 164) 618 referred to.) (Pp. 338, paras. E-F; 357, paras. F-G)
  2. On need for plaintiff to have locus standi before being heard in court-

Locus standi is a status which a plaintiff must have before being heard in court. In the instant case, the fact and circumstances were certainly sufficient to vest the appellant with locus standi to maintain the action. (Momoh v. Olotu (1970) 1 ALL NLR 117; Gamioba v. Ezezi II (1961 ALL NLR 584, (1961) 2 SCNLR 237; Adesanya v. The President (1981) 5 SC 112 referred to.) (Pp. 362, paras. E-F)

  1. On how locus standi of plaintiff is determined-

The question whether or not a plaintiff has a locus standi in a suit is determinable from a totality of all the averments in his statement of claim. Thus, in dealing with the locus standi of a plaintiff, it is his statement of claim alone that has to be carefully scrutinised with a view to ascertaining whether or not it has disclosed his interest and how such interest has arisen in the subject matter of the action. (Bolaji v. Bamgbose (1986) 4 NWLR (Pt. 37) 632; Momoh v. Olotu (1970) 1 ALL NLR 117 referred to). (Pp. 354-355), paras. F-G)

  1. On what averments in plaintiff’s pleadings must disclose to confer locus standi on him –

Where the averments in a plaintiff’s statement of claim disclose the rights or interests of the plaintiff which have been or are in danger of being violated, invaded or adversely affected by the act of the defendant, the complaint of such a plaintiff would be deemed to have shown sufficient interest to give him the locus standi to litigate over the subject matter in issue. In the instant case, there can be no doubt that the appellant, in the light of the averments in the statement of claim, disclosed sufficient interest in the subject matter of his claim and so has locus standi. (Momoh v. Olotu (1970) 1 ALL NLR 117; Adesanya v. President of the Federal Republic of Nigeria (1981) 5 SC 112; Eleso v. Government of Ogun State (1990) 2 NWLR (Pt. 133) 420; Oloriode v. Oyebi (1984) 1 SCNLR 390 referred to.) (P. 355, paras. A-E) per Iguh, J.S.C. at page 355, paras. B – E)

“In the present case, the plaintiff did not only plead that he is a member of the Celestial Church of Christ, an Honorary Evangelist, a member of the Board of Trustees, Chairman of the Council of International Management Committee and the 1st Vice Chairman of the Council of Honorary Evangelists of the said Church, it was further averred that he is interested in the office of the Pastor of the Church and that he has a right under section II of the Constitution of the Church to be named and proclaimed the successor to the said office of Pastor.

It was also pleaded that Papa Oshoffa, the Pastor Founder of the Church, had during his life time named the plaintiff and no one else as his successor. The plaintiff therefore contended in his said pleadings that he is the only person rightfully entitled to be named and proclaimed the successor to the office of Pastor and that the purported proclamation of the 2nd defendant as the successor of the deceased Pastor/Founder is not only unconstitutional but illegal and null and void. It is clear that the plaintiff’s claim is that he had the civil right and obligation to ensure that the appointment of the office of Pastor, is carried out in a way that does not adversely affect his interest in that office.

There can be no doubt, in the face of the above averments in the statement of claim, that the plaintiff disclosed sufficient interest in the subject matter of his claim.

  1. On need for claim to reveal sufficient interest in order for plaintiff to have standing to sue-

In order to achieve the status of locus standi or standing to sue, the claim of the plaintiff must reveal a legal or justiciable right or show sufficient or special interest adversely affected. The claim also ought to reveal a justifiable cause of action. In the instant case, the appellant disclosed in his averments the interests which he had in commencing the action. (P. 366, paras. BH).”

Applying the above to the arguments raised in issues 1 and 2 in appellant’s brief, the respondent’s preliminary objection with the findings of the learned trial Judge at pages 169, 170 and 171, of the record of appeal, it is my view that the respondents established their locus standi having been based on their statement of claim and that the issues 1 and 2 raised in appellant’s brief of argument lack substance in that the objection was based on evidence as contained in exhibits O, P, Q and R, which evaluation and ascription were rightly done by the learned trial Judge his conclusion, being a finding of fact as an appellate court as the findings of facts as to the legal sufficient interests of respondents they were not perverse as they were borne out as pleaded in the statement of claim and evidence based on the said averments, they confirm that respondents have sufficient legal interest on the infringement of their legal rights, appellant’s complaints of the lack of locus standi being a threshold question is hereby rejected and reiterate that respondents had sufficient legal interest to institute the action in the lower court, The lower court to adjudicate on the action it must be competent so held the Supreme Court in the case of Gabriel Madukolu and Others (for themselves and on behalf of the Umuonala Family v. Johnson Nkemdilim (1962) 2 SCNLR page 341 at 348 that- “Per Bairamian, F. J. thus:-

Put briefly, a court is competent when:

  1. It is properly constituted as regards numbers and qualifications of the members of the bench and no member is disqualified for one reason or another; and
  2. The subject matter of the case is within its jurisdiction and there is no feature in the case, which prevents the court from exercising its jurisdiction; and
  3. The case comes before the court initiated by due process of law and upon fulfilment of any condition precedent to the exercise of jurisdiction, Any defect in competence is fatal for the proceedings are a nullity, however, well conducted and decided the defect is extrinsic to the adjudication, applied in Adisa v, Oyinwola (2000) 10 NWLR (Pt. 674) page 116 SC; Uwah Printer (Nig,) Ltd. v. Umoren (2000) 15 NWLR (Pt. 689) page 78 CA.”

Applying the above with the finding that respondents had the locus standi confirmed by this court, with appellants as defendants and counter-claimants in the lower and trial court that proper parties were before the court, but appellants attacked the jurisdiction as the land in dispute as shown in exhibits O, P, Q and R, pointedly that the land fell within Iwo Local Government inclusive of the Oba Hills Forestry Reserve the action ought to have been filed and commenced in Osogbo High Court and not Oyo High Court with the former as the lex situs.

“By jurisdiction is meant the authority which a court has to decide matters that are litigated before it or to take cognisance of matters presented in a formal way for its decision. The limits of this authority are imposed by the statute, charter or commission. Section 272 (1) 1999 Constitution reads thus:-

“272(1) Subject to the provisions of section 251 and other provisions of the Constitution, the High Court of a State shall have jurisdiction to hear and determine any civil proceedings in which the existence or extent of a legal right, power, duty, liability, privilege, interest, obligation or claim is in issue or to hear and determine any criminal proceedings involving or relating to any penalty, forfeiture, punishment or other liability in respect of an offence committed by any person.”

Under which Oyo State High Court was set up and High Court Law of Oyo State Cap. 46, sections 10 and 14 are constituted and which may be extended or restricted by similar means. If no restriction is imposed, the jurisdiction is said to be unlimited. A limitation may be either as to the kind and nature of the actions and matters which the particular court has cognisance or as to area which the jurisdiction extends or it may partake of both these characteristics, see vol. 10 Halsbury’s Laws of England paragraph 715 page 323.

Judicially interpreted that High Court has unlimited jurisdiction on grant of statutory right of occupancy and concurrent jurisdiction with customary court for grant of customary grant of occupancy Adisa v. Oyinwola (2000) 10 NWLR (Pt. 674) page 116 SC; Akande v. Alagbe (2000) 15 NWLR (Pt. 690) page 353 CA.

At page 857, Black’s Law Dictionary Seventh Edition, ‘Territorial Jurisdiction’ means;

  1. Jurisdiction over cases arising in or involving persons residing within a defined territory
  2. Territory over which a governance, one of its courts or one of its sub-divisions has jurisdiction.”

My understanding of the contention of the appellants raised that by virtue of exhibits O, P, Q and R, Oyo High Court lacked territorial jurisdiction to adjudicate on this matter especially exhibit P, the map of Iwo Local Government wherein at the North West Corner, Oba Hills Forest Reserve depicted green showed that Kiyeseni, which the parties contended to be the boundary between Oyo Local Government and Iwo Local Government fell within Oba Forestry Reserve shown to be within Iwo Local Government. By virtue of falling within Oba Forestry Reserve court ought to hold that the rights of the owners were preserved under the Forestry Law of Oyo State, with reliance based on the case of Oba Adetayo I. the Orimolusi of Ijebu-Igbo and 2 ors. v. The A.-G., Western State & 3 Ors. WSCA volume 2,1976 page 146. Incidentally, I was the learned Counsel for the 3rd respondent/defendant. The case is distinguishable from this case wherein I submitted at page 151 Kayode Eso, J.C.A. (as he then was) stated-

“Mr. Onalaja said in his own submission that parties are bound by their pleadings. When an area is constituted Forest Reserve, all rights are extinguished except rights that were reserved. The plaintiffs must aver the rights that were reserved under section 10. Once the fact that their rights were saved was not pleaded, plaintiffs were out of court.”

In the instant appeal, appellants did not aver nor led EVIDENCE that their rights were reserved, saved or recognised in the judgment of the SETTLEMENT OFFICER under section 10 of the Forestry Law. The appellants showed no nexus of the land in dispute with exhibit Q being WR Public Notice No. 61 of 1953 as Order made under THE FORESTRY ORDINANCE CAP. 75, OBA HILLS FORESTRY AMENDMENT ORDER 1953.

Exhibit R did not assist appellants either, it is vegetation map without naming any body.

The last straw that breaks the appellant’s camel back are exhibits A and N, which are survey plans of the disputed land by respondents and appellants/counter-claimants. In exhibit A, the land in dispute was verged blue and covered an area of 401.363 hectares. It showed the reserved forest to the North West of exhibit A after Oba River without demarcation or extent of the reserved forest without describing it as Oba Hill Forest reserve it did not Form boundary with the area verged blue as the land in dispute in exhibit A.

In exhibit N, though OBA HILLS FOREST RESERVE was shown in the Northern part the area in dispute did not include the OBA HILLS FOREST RESERVE it only formed boundary and extends to OBA RIVER.

From the foregoing, the findings of the learned trial Judge at pages 170 to 171 of the record of appeal underlined above for avoidance of repetition are hereby re-adopted.

Having looked critically and my comments on exhibits A, N, O, P, W and R, supra the finding of fact by the learned trial Judge, that he had jurisdiction to adjudicate was borne out from the pleadings, evidence and assumption of jurisdiction to establish adjudication on the matter was through the pieces of evidence and bold to say that the finding was not perverse and as appellate court there is no legal basis or justification to disturb the said finding of fact. Issues 1 and 2 are resolved against appellants, the arguments in the preliminary objection was subsumed in the consideration of appellant’s issues 1 and 2, already resolved against the appellants as unmeritorious.

Having disposed off issues 1 and 2 in appellant’s brief of argument and the preliminary objection on respondent’s brief of argument, the other issues formulated by respondent’s correlation to the grounds of appeal impressed me and I adopt the said four issues in respondent’s brief of argument as the fulcrum of further consideration in this appeal, this is without prejudice to marrying other appellant’s issues with respondents’ four issues.

Issue 1 respondent’s brief of argument same as issue 3 in appellants’ brief of argument succinctly put as to the role expected of a witness subpoened under section 192 or 193 of the Evidence Act.

Appellants at pages 11 to 13 of their brief of argument submitted that a witness subpoened to tender documents under sections 192 and 193 Evidence Act, was merely to tender the document no more.

Once DW2 had produced the document the duty is cast on the court to scrutinize it. The learned trial Judge understood this law but erred when he stated at page 171 that:-

“A close scrutiny of the plan shows Kiyeseni as being within Iwo Local Government Area whereas the defendants in paragraph 11 of their amended statement of defence averred that the boundary between Iwo and Oyo Local Government is at Kiyeseni which is said to be about 2 kilometres from the land in dispute when going from Iwo to Oyo.”

The above finding and conclusion by the learned trial Judge foreclosed further evidence of the boundary between Iwo and Oyo Local Government, when appellants predicated the case that the land in dispute fell within Iwo Local Government. The mere production of the map raised the presumption of the contents without any further proof under section 119 Evidence Act. Having tendered exhibit P as a map under section 119 of the Evidence Act, the maps being documentary evidence were of superior probative value than the concocted traditional evidence. As the issue of jurisdiction was raised it was incumbent on the learned trial Judge to resolve the issue of jurisdiction before proceeding to hear the case Ukpai v. Okoro (1983) 11 SC 231 at 249. Appellants were silent as to the effect of what resolution, this court was to make in the appeal, on the said issue.

Respondents submitted on their issue one in their brief of argument at pages 5 and 6 that as 3rd DW was subpoened to tender a public map under sections 192 and 193 and 119 Evidence Act there was no need to give evidence on it, that there was no evidence as to the type of subpoena served on 3rd DW. If he was subpoenaed to tender the map, he became a witness for the purposes of the case and would need to give evidence to explain the map to the court to be of any assistance to the court Famakinwa v. Unibadan (1992) 7 NWLR CPt.255) 608; Akono v. The Nigerian Army (2000) 14NWLR CPt.687) page 318 at 328-329.

Section 119 Evidence Act, merely provides for admissibility of such map without further proof and that the map shall be presumed to be correct, it was the failure of the 3rd DW to explain the map to the court that led to the observation of the court at page 171 and properly admitted under section 119 of Evidence Act. The court did not allow the failure or inability of 3rd DW, to explain the map to deter him. Appellants conceded that the learned trial Judge scrutinized the map himself, before making his finding on it. There is no merit in this issue ground 2 upon which it was based be dismissed.

The above issues raised the application of sections 192, 193 and 119 Evidence Act, Cap. 112, Laws of the Federation of Nigeria, 1990 they stated as follows:-

“S. 192. Any person, whether a party or not, in a cause may be summoned to produce a document without being summoned to give evidence, and if because such document to be produced in court, the court may dispense with his personal attendance.

  1. A person summoned to produce a document does not become a witness by the mere fact that, he produces it and cannot be cross-examined unless and until he is called as a witness.”

Judicially interpreted in Michael Onwuamaka v. Albert Okolie (1955-56) WRNLR 1959, that a person who was called by the respondent to produce the record of previous proceedings, which record was required in the suit went to the witness box and tendered the record on oath. The trial magistrate refused the appellant right to cross-examine him on the ground that he was called merely to produce a document. In holding that the trial magistrate was in error Onyeama Ag., J. (as he then was) said:-

“It is to be observed section 192 of the Evidence Ordinance speaks of A person summoned and A witness. I am of the opinion in view of section 179 of the Evidence Ordinance, that a witness under the Evidence Ordinance is anyone who gives evidence in any proceedings upon oath or affirmation and by virtue of section 181 and 182 of the Ordinance. It follows from this that, the person who put in the certified copy of the native court proceedings, upon being sworn, became a witness for all purposes and was liable to cross-examination. See further Mr. J. O. Famakinwa v. University of Ibadan & Anor. (1992) 7 NWLR (Pt. 255) page 608 CA; Akono v. The Nigerian Army (2000) 14 NWLR (Pt. 687) page 318 at 328-329 CA.

Interpreted sections 192 and 193 Evidence Act. It was held in Famakinwa’s case that;

“(7) A person who by subpoena duces tecum produces a document, does not merely by such production become a witness and this explains why he is not sworn or cross examined.

Conversely, a person who is issued with subpoena ad testificandum et duces tecum, would not only be required to produce the document in question, he would in addition be led in evidence on oath as well as lay himself open to cross-examination.”

In the instant appeal, the 2nd DW and 3rd DW were not summoned to tender documents alone. Rather they were called as witnesses for respondents as apart from tendering documents they were sworn as witnesses, testified in chief and later cross-examined. If it was intended to tender documents alone they should just have produced the documents alone and should not have been sworn as clearly stated in section 192. But where the party was sworn in and took oath and then cross-examined be caused to be summoned to produce a document but turned a witness and anybody sworn on oath is liable to be cross-examined as a witness. The trial Judge is at liberty to comment on the oral and documentary evidence given by the witness. The comments on 2nd and 3rd DWs, who were witnesses and not summoned merely to produce documents and subjected to cross-examination made the learned trial Judge to comment on their testimonies as witnesses and not covered by section 192 Evidence Act.

The attack by appellants on the comments by learned trial Judge on the 2nd and 3rd DW, who were rightly treated as witnesses and not merely summoned to tender documents only lacked substance and merit leading to dismissal of the appeal on this ground. The arguments of the respondents on this issue are more convincing and proper interpretations of sections 192 and 193 Evidence Act, Cap. 112, Laws of the Federation of Nigeria.

Issue IV in respondents’ brief is similar to issue 7 in appellant’s brief of argument.

Appellants complained in ground 10 of the amended grounds of appeal No. 2 that the learned trial Judge at pages 64 and 65 recorded that:

“(i) Dr. Aremu had raised the issue as to whether:

He in fact further said that when the defendants were first intimated with the idea, they were initially happy in the belief that such a scheme would provide job opportunities for the residents in the neighbourhood.

(ii) However, it was in paragraphs 35 and 36 of the plaintiff’s statement of claim in which it is clearly shown that it was the plaintiffs, who in their pleadings, made the statement and their witnesses (especially 3rd plaintiff and 3rd PW) who gave evidence in support of the said statement.

(iii) The said statement made in paragraphs 35 and 36 of the plaintiff’s statement of claim was denied in paragraphs 15 and 16 of the defendant’s statement of defence.”

On appellant’s issue 7 at page 15 of appellant’s brief of argument appellants proffered this argument to show its frivolity. It is better to reproduce it:-

“(1) This shows a clear misconception of the facts by the learned trial Judge, which puts a completely different colour on the case which led to the decision arrived at by the learned trial Judge and this led to a miscarriage of justice. I submit that even on that alone the appeal should be allowed.”

I must confess that I am completely at a loss to understand this issue, which complaint does not form part of the judgment of the learned trial Judge, recorded at pages 114 to 188 of the record of appeal, no nexus was made between issue 7 and the judgment. The statement credited to the learned trial Judge no reference was made to the portion of the judgment, no wonder the argument on appellant’s issue 7 referred to above was scanty, terse and done half heartedly.

Respondents’ issue four was argued at page 8 of respondents’ brief of argument, it reinforced the point that nothing was in the judgment under attack. The statement had no effect on the judgment as it is not every error in judgment that vitiates the judgment Onifade v. Olayiwola (1990) 7 NWLR (Pt. 161) the issue based on the ground of appeal.

As stated above this issue 7 is not only vague and frivolous but also devoid of any merit as it is unmeritorious it is resolved against the appellants leading to the dismissal of the appeal on this ground.

Issues (ii) and (iii) in respondent’s brief of argument and issues 3, 4 and 6 in appellant’s brief of argument raised similar issues and are further encompassed that whether having regard to the pleadings, evidence and law the learned trial Judge was right to have granted all the claims and reliefs sought by the plaintiffs/respondents whilst he rejected the counter-claim of appellants based in evaluating the evidence on credibility of the witnesses.

Appellants contended that in view of both oral and documentary evidence the provision of section 45, Evidence Act enured to appellants in that all the boundaries and farm land were surrounded by grantees of the Oluwo of Iwo’s customary tenants for over a period of over 100 years and denied paying Ishakole to respondents as their customary tenants. The hunting rights and expeditions of respondents were not sufficient to grant declaration of customary right of occupancy, more especially as shown in exhibits A and N.

Thereby, the provision of section 45 of Evidence Act enured to appellants. Onwuka v. Ediala (1989) 1 NWLR (Pt. 96) p. 182 at 199; Ededem Archibong IV v. Ntoe Asim Ita (1954) 14 WACA 520.

Appellants stated that to evaluate the evidence under the rule in Odofin & Ors. v. Mogaji & Ors. (1978) 1 LRN page 212 at 213, 1978 3/4 SC 91 at 98, the learned trial Judge did not weigh the evidence adduced before him properly by setting up the judicial imaginary scale. The contradictions in appellants’ evidence were not material contradictions to affect the value or diminish the weight of evidence against appellants as it is not all contradictions that affect the value of evidence Ikegwoha v. Ohawuchi (1996) 3 NWLR (Pt. 435) page 146.

Respondents relied on hunting rights which at best was a bare licence and could never mature into ownership as such rights are revocable at will. On the payment of Ishakole, respondents did not establish the payment by appellants to respondent. The 2nd PW stated thus, at page 49 of the record:-

“I have not personally seen any of the defendants bring Ishakole to the plaintiffs in this case.”

Unlike non direct evidence of payment of Ishakole by appellants to respondents the 10th DW Prince Alade Lamuye, gave direct oral evidence of the payment of Ishakole by appellants to the Oluwo their overlord. The learned trial Judge had no legal basis to have believed and preferred the evidence of respondents’ witnesses to that of the appellants’ and their witnesses.

Appellants conceded that they did not plead for relief against forfeiture in statement of defence and counter-claim, though this was sought at the address stage of the learned counsel for appellants.

Initially, the learned trial Judge in his consideration found that the conduct of the appellants did not amount to misconduct to warrant forfeiture, yet he proceeded to grant the forfeiture when he ought to have taken into account the degree of inconvenience to the appellants considering the length of time spanning over 100 years they had been in possession and the improvements already made on the land Uwani v. Akom (1928) 3 NLR 19 forfeiture is not usually granted against a whole community being relief against an individual the relief against forfeiture ought to have been ordered Inisa v. Oshodi (1930) 10 NLR page 80.

Let me refer to paragraph 2 of the statement of claim which reads as follow:-

“(2) The defendants who are farmers, live at Olukotun village in Iwo District.”

to which paragraph 2 the appellants averred in paragraph 3 of amended statement of defence and counter-claim as follows:-

“3. The defendants admit paragraph 2 and aver that they the defendants came to the area later known as Olukotun Idi-Iroko in Iwo Local Government Area during the reign of Oluwo Lamuye between 1816-1906 when their great grand father, Akinlusi was granted a vast area of land including the land in dispute along Iwo/Oyo Road as customary tenants of the Oluwo.”

From the foregoing, appellants were sued individually though jointly and severally, they were not sued as a community. Appellants’ contention that relief against forfeiture ought not to have been granted as it was not usually granted against community must have been based on wrong principles and misconception that appellants constituted a community further consideration shall be given on the issue of relief against forfeiture after consideration of the argument of respondents on the issue of relief against forfeiture.

On issues (ii) and (iii) in respondent’s brief of argument, respondents at pages 6, 7 and 8, of their brief of argument submitted that the learned trial Judge rightly held that, as the grant by Oluwo the grantor of the land to appellants was not admitted by respondents the onus was on appellants to prove the title of Oluwo their alleged grantor Ogunleye v. Oni (1990) 2 NWLR (Pt. 135) page 745 at 789. Appellants failed to plead not only the title of their alleged grantor but also led no evidence so found the learned trial Judge on this crucial finding to which regrettably appellants did not appeal against this finding which is fatal to appellant’s appeal Elias v. Omo Bare (1982) 5 SC 25. 57-58; Mogaji v. Cadbury (Nig.) Ltd. (1985) 2 NWLR (Pt. 7) page 393 at 431 and Bamgboye v. Olusoga (1996) 4 NWLR (Pt. 444) page 520 at 546, the tendering only of exhibits O, P, Q and R, only no more were insufficient without supportive and convincing evidence.

In answer to the contention of appellants on the applicability of section 45 Evidence Act, to the facts of this case raised a rebuttable presumption of ownership to which respondents led satisfactory evidence to rebut the presumption rightly held by the learned trial Judge. The Forestry Law relied upon by the appellants did not assist them as they did not establish that under section 58(2) of the said Forestry Law that their rights were preserved. The issue should be resolved against appellants with the consequential dismissal of the appeal.

Issue 3 respondents’ brief of argument raised the evaluation of the evidence adduced by the parties to which after consideration Found and assessed the evidence of 2nd plaintiff, 6th, 7th, 8th PW, 9th PW, 10th PW and 11th PW to be consistent in line with the averments in the statement of claim established that their ancestors first settled on the land in dispute. Respondents proved acts of ownership and payment of Ishakole by appellants, and other acts of ownership by hunting rights were established by satisfactory, reliable and convincing evidence as found by the learned trial Judge. On the contrary, he found the evidence of appellants’ witnesses unreliable. Appellants’ witnesses were inconsistent and contrary to the pleadings. The learned trial Judge evaluated the evidence properly and ascribed proper weight to them. The contention of appellants that the learned trial Judge did not evaluate the evidence adduced before him be rejected as it lacked substance. As the learned trial Judge based his evidence on the credibility of the witnesses, the appellate court is handicapped to disturb such finding, so appellants’ appeal is unmeritorious and should be dismissed.

It is common ground and conceded by appellants that they did not plead relief against forfeiture and was only agitated during the address stage by learned Counsel for appellants, having not pleaded relief against forfeiture once the learned trial Judge accepted the traditional evidence he had no alternative than to grant the relief against forfeiture Makinde v. Akinwale (2000) 2 NWLR (Pt. 645) page 435 at 452 to 453; Oniah v. Onyia (1989) 1 NWLR (Pt. 99) page 574 at 533; Seaview Investment v. Munis (1991) 6 NWLR (Pt. 195) page 67 at 86, 88.

Appellant’s submissions and contentions on the issues above considered lacked merit and should be dismissed and urged the court to confirm and uphold the judgment of the learned trial Judge of the lower court of Oyo High Court.

The issue of relief against forfeiture under customary law was pronounced upon in the illuminating and instructive judgment of the Supreme Court in and held therein in Audu Makinde (Head of Family) and nine Ors. (For themselves and as head and representatives of Idota family of Otta v. Dawuda Akinwale and 10 Ors. (2000) 2 NWLR (Pt. 645) page 435.

2″4. On when relief of forfeiture available.

A customary tenancy is liable to forfeiture when the tenant commits any offence that can lead to forfeiture or that is incompatible with the customary tenancy such as the denial of the overlordship of the landowners. (P. 452, paras. F-G)

  1. On effect of customary tenant denying title of the true overlord –

It is a most serious set of misbehaviour by a customary tenant to deny the title of the true overload to the land, which he is a tenant of. It is misbehaviour which is a firm ground for forfeiture of the tenancy and is said to be so as a widely accepted system. In the instant case, the evidence is clear that the respondents denied the overlordship of the appellants. (Dokubo v. Bob-Manuel (1967) 1 ALL NLR 113, Erinle v. Adelaja (1969) 1 NWLR 132; Taiwo v. Akinwunmi (1975) 4 SC 143; Oniah v. Onyia (1989) 1 NWLR (Pt. 99) 514; Odunsi v. Bamgbala (1995) 1NWLR (Pt. 374) 641; Onwugbufor v. Okoye (1996) 1 NWLR (Pt. 424) 252 referred to.) (Pp. 452-453, paras. H-A)

  1. On effect of customary tenant claiming title against his overlord-

In land cases, where the tenant turns round not only to dispute the overlordship of the title holder but goes out of his way to claim title, he forfeits his right as a tenant and his possession of the land. In other words, once it is found that a customary tenant has committed an act of misbehaviour which entails forfeiture, and there is no relief sought against forfeiture, forfeiture becomes a matter of law for the court. The court has no discretion in such circumstances. In the instant case, the appellants claimed forfeiture, but the respondents did not seek relief against forfeiture.

Rather, they persisted in their adverse claim of title to the land (which was found to be in the appellants) and continued to deny the appellant’s overlordship. In the circumstance the trial court should have ordered forfeiture but did not. The appeal against the failure to do so should have succeeded had the court of Appeal reached a proper conclusion (P.453, paras. A-C)

Per EJIWUNMI, J.S.C. at page 456, paras. B-C:

In the case in hand, it is my humble view that the appellants clearly sought by their pleadings for an order of forfeiture against the respondents, and they duly also, established their reasons for asking for this order. The respondents did not seek for a waiver against the order. It follows therefore, that the court below was in error for not granting the order of forfeiture sought for by the appellants.

  1. On Nature of misbehaviour that would render customary tenancy liable for forfeiture-

Forfeiture is the usual mode of determining a customary tenancy. The real basis of the misconduct of misbehaviour which renders the tenancy liable for forfeiture is the challenge to the title of the overlord.

This may be by:

(a) alienation of part of the land; or

(b) a claim of ownership; or

(c) refusal to pay the tribute due; or

(d) direct denial of overlord’s title by setting up a rival title in the customary tenant himself.

Although, the non-payment of rent or tribute is not necessarily inconsistent with the ownership of the overlord, the circumstances and the reasons for the refusal to pay tribute may determine whether there is a denial of the title of the overlord. (Oniah v. Onyia (1989) 1 NWLR (Pt. 99) 514 referred to.) (P. 455, paras. D-F).

  1. On whether forfeiture of customary tenancy automatic –

Even where there is an established misconduct of a customary tenant, forfeiture is not as of course or automatic. There is no such thing as automatic forfeiture. It merely makes the culprit liable to forfeiture at the will of the landlord. Hence, the landlord must take necessary steps to enforce his right of forfeiture for the misconduct in the court. (Oniah v. Onyia (1989) 1NWLR (Pt. 99) 514 referred to.) (P. 455, paras. G-H).

  1. On need to plead forfeiture or relief against forfeiture –

The forfeiture claimed must be pleaded. Similarly, it is vital to plead the claim for relief from forfeiture. Failure to plead either is fatal to the claim. However, where a grantor claims for recovery of possession and pleads the grounds upon which the right to recovery is based, the action is not incompetent because forfeiture is not specifically claimed. Thus, the mere absence of the technical word forfeiture from the pleadings cannot be fatal in the circumstances where the nature of the claim is abundantly clear. (Oniah v. Onyia (1989) 1 NWLR (Pt. 99) 514 referred to.) (Pp. 455-456, paras. H-B).

See also Ademola Oladipupo & 1 Or. v. Oyebamiji Olaniyan & 2 Ors. (2000) 1NWLR (Pt. 642) page 556 at 565 CA wherein it was held as follows:-

  1. On need for boundaries of land in dispute to be ascertainable –

In a matter where a plaintiff seeks a declaration of the ownership of a parcel of land, he must establish the

precise boundaries of the land in order to be able to identify the land in dispute. A plaintiff who fails to prove and ascertain such land is bound to fail in his action. (Etim v. Oyo (1978) 6-7 SC91; Udofia v. Afia (1940) 6 WACA 216 referred to. (P. 565, paras. E-H).

  1. On Termination of a customary tenancy –

A customary tenant is ipso entitled to possession of the land granted to him and although he is liable to forfeiture of such rights when he denies the title of his landlord or commits a serious misconduct, yet his rights are not determined until operation of forfeiture (Akinkuowo v. Fafimoju (1965) NMLR 349; Atolagbe v. Shorun (1985) 1 NWLR (Pt. 2) 360 referred to. (P. 567, paras. D-E).

Applying the above to the instant appeal the learned trial Judge stated at pages 184 line 25 to page 185 line 20 of the records of appeal as follows:-

“All these notwithstanding, partly because of the fact that the defendants were not initially guilty of any misconduct before the plaintiffs sought to recover portions of the land in dispute from them …(See Oniah v. Onyia (1989) 1 NWLR (Pt. 99) 514 at 533. Thus, much as I would have been inclined to grant the 304 defendants’ relief against forfeiture. I am bound by the foregoing decision of the Supreme Court and since the defendants have failed to claim the relief, I have no alternative but to grant the order of forfeiture sought by the plaintiffs.”

The learned trial Judge in granting the relief against forfeiture applied the rule that parties are bound by their pleadings as unpleaded facts go to no issue. Also the rule of law that a court shall not grant a relief not sought from the court or grant more than what is claimed.

From the encompassed issue the attack or complaint of appellants was wrongful evaluation of the evidence adduced before the court, that a proper assessment should have led to the dismissal of respondents’ claims for failure to establish their root of title and non concrete and convincing evidence that appellants paid Ishakole or tribute to respondents whilst 10th DW categorically confirmed payment of Ishakole by appellants to 10th DW’s ancestors. The learned trial Judge wrongly believed and rejected appellants’ testimonies in preference to that of the respondents, so Court of Appeal should reverse the judgment as respondents failed to discharge the onus placed on them whilst appellants proved their counter-claim by preponderance evidence of probability thereby the Court of Appeal should dismiss respondents’ claim as it dismissed rightly the claim for damages of the respondents whilst it should reverse the dismissal of appellants’ counter-claim and award damages as claimed by appellants.

Respondents submitted that at pages 172 to 183 the learned trial Judge evaluated evidence of the witnesses for both the respondents and appellants. Previously in this judgment it was stated that the learned trial Judge found the witnesses for respondents to be truthful witnesses, whilst he found the witnesses for appellants to be unreliable. As the findings were based on credibility of witnesses this court is handicapped to disturb such findings, this court should affirm the conclusion and judgment of the learned trial Judge. Unless or except that the findings of the learned trial Judge were perverse, the appeal court will not disturb such finding as decided with reliance on Odofin v. Ayoola (1984) 11 SC 72. 86-87; Ajagungbade III v. Laniyi (1999) 13 NWLR (Pt. 633) page 92 at 113-14; Ogbuehi v. Government of Imo State & Ors. (1995) 9 NWLR (Pt.417) page 53 CA.

It is trite law that evaluation and ascription of weight to the evidence is primarily the function and duty of the learned trial Judge. The learned trial Judge as stated above based part of the judgment by believing especially the testimonies of 2nd PW, 2nd plaintiff, 6th PW, 7th and 11PWs in preference to the appellants’ witnesses as stated partly in the judgment at pages 175 lines 7 – 9, 175 lines 15 – 19, 176 lines 2 to 17, 13 to 17,23 -32,17 lines 10-14, 26-29,178 lines 7 to 9 page 179 lines26 – 31, 184 lines 15 to 25.

Respondent’s witnesses in preference to the appellants’ witnesses, who were found to be untruthful and unreliable witnesses. The attitude of the Court of Appeal on credibility of witnesses by the lower court is well settled as evaluation and ascription of weight is the sole business of the trial Judge and where the judgment is based on credibility of witnesses the appeal court is handicapped, unless it can be established that the learned trial Judge did not take the advantage of watching the demean ours of the witnesses and hearing and seeing them Ebba v. Ogodo (1984) 1 SCNLR 372. Per Eso, J.S.C., thus:-

(d) Where the decision arrived after there has been an examination of a controversy (and this is the commonest aspect) as where the opposing parties produce witnesses in the case to contradict each other by oral evidence then the Court of Appeal should appreciate that the following will be relevant:-

(i) Credibility of witnesses based on demeanours of the witnesses only:-

Here, the trial court is the sole Judge as the observation of the demeanour of witnesses has to be peculiar and exclusive to the trial court, which advantage is not and can never be available to the appellate court.

(ii) Credibility of witnesses based on factors other than demeanour:-

The Court of Appeal should examine the factors which the trial court examined as a result of which is made the inference which led to its finding and determine whether that the trial court has made use of its singular advantage of seeing and hearing the witnesses before making its finding especially having regard to the interference that could reasonably be made by a just and reasonable tribunal from these same factors.

This court has time without number emphasized that it is no business of the Court of Appeal to substitute its view of the evidence for that of the learned trial Judge and I will find it again necessary to point out that miscarriage of justice will definitely result from adopting such a course of action when it is unwarranted the need to ensure that justice is not miscarried should always dominate the attitude and thinking of appeal courts when dealing with appeals raising questions of fact.

See further Victor Woluchem & Ors. v. Chief Simeon Gudi & Ors. (1985) 5 SC 319; Edward Ukaegbu Nwokoro & Anor. (for themselves and as representing the family of Amarum Amaediba Nkpa v. Ezekiel Nwosu & 5 Ors. (for themselves and as represeting Agbue family in Umualaukocha Amaediba family) (1994) 4 NWLR (Pt. 337) page 172 CA; Musa Sha (Jnr.) & Anor. (for themselves and on behalf of Lo-Kwei family) v. Da Rap Kwan and 3 Ors. (2000) 8 NWLR (Pt. 670) page 685 SC; Akande v. Alagbe (2000) 15 NWLR (Pt. 690) page 353 CA; Olowoake v. Salawu (2000) 11 NWLR (Pt. 677) page 127 CA; Sosanya v. Onadeko (2000) 11NWLR (Pt. 677) page 34 CA; Wilson v. Oshin (2000) 9 NWLR (Pt. 673) page 442 SC; Oduwole v. Aina (2001) 17 NWLR (Pt. 741) page 1 CA.

Applying the above principles, I have seen no reason and justification from the printed evidence that the learned trial Judge failed to take advantage of seeing and hearing the witnesses before making his finding especially having regard to the inference that could reasonably be made by a just and reasonable tribunal from the same facts. I therefore, see no legal justification in law and facts to interfere with the reasoning and conclusion on the findings of the learned trial Judge having seen, heard, and watched the demeanours of the witnesses that the appellants and their witnesses were untruthful and unreliable. The learned trial Judge advanced reasons in drawing the inference, it is my view that from the printed record of appeal, the learned trial Judge applied rightly the setting up of the imaginary judicial scale in the rule in Mogaji v. Odofin (1978) 1 LRN (1978) 3/4 SC 91, therefore, the attack of the appellants on the judgment of the learned trial Judge that he did not evaluate the evidence before him properly are baseless and are hereby, declared as unmeritorious leading to resolving issues 4 and 5 in appellant’s brief of argument against the appellants, with the consequence of the dismissal of the appeal on the said issues as lacking in substance.

Having resolved all the issues raised by appellants in this appeal against appellants the appeal is dismissed for the reasons adumbrated above. Following the dismissal of that? appeal the judgment of Oyo High Court delivered by Hon. Justice Ademakinwa on 15th Feb., 1989, is hereby affirmed and confirmed. As a result the respondents are entitled to the cost of this appeal, which acting judicially and judiciously based on the legal principle that costs follow the events and awarded to compensate the successful party and not punish the unsuccessful party. I fix the cost of N5,000.00 (Five thousand Naira), in favour of respondents against the appellants.


Other Citations: (2002)LCN/1070(CA)

African Continental Bank Plc & Anor V. Emostrade Limited (1997) LLJR-CA

African Continental Bank Plc & Anor V. Emostrade Limited (1997)

LawGlobal-Hub Lead Judgment Report

AKPABIO J.C.A.

This is an appeal against a judgment of ITA, J. of the High Court of Cross Rivers State of Nigeria holden at Calabar in Suit No. C/43/94 delivered on 5th February, 1996, wherein he entered judgment in favour of the plaintiff in the sum of N2,500,000.00 being damages for breach of contract will, no order as to costs.

The plaintiff’s particulars of claim as filed in the court below were worded as follows:

“The plaintiffs claim against the defendants jointly and severally is the sum of N5,000,000.00 (Five million naira) being special and general damages for breach of contract in that the defendants who are the plaintiff’s bankers have refused to furnish the plaintiff at her request and expense statement of account held as a customer of the defendants whereof the plaintiff has suffered damages in its trade and profession.”

The gist of plaintiffs claim as finally set out in his six-page statement of claim may be summarised as follows:

At all material times, one Victor Ndoma-Egba, a Barrister and Solicitor, and also the Chairman, Board of Directors of Plaintiffs Company, who testified as PW1, for the plaintiff, held at least five current accounts in which he was sole signatory in 1st defendant’s bank at Calabar. Second defendant was the Calabar Branch Manager in the said Bank. Among the accounts of which P.W1, was sole signatory was Account No. 05474. Apart from the five accounts in which P.W.1 was sole signatory, there was also another Account No.05756 in the name of Ndoma-Egba, Ebri and company, a firm of Solicitors. In respect of this Account, P.W.1, and one Richard Ebri were co-signatories. All the accounts were current accounts.

According to the testimony of P.W.1, at the trial court, on 30/3/93, he (P.W.1.) went to the 1st defendant bank in Calabar to confirm if a cheque they issued to a client had been cleared. The cheque was drawn on Account No.05756.

There P.W.1, met the Branch Manager (2nd defendant). When the Ledger Card for Account No.05756 was produced, P.W.1, noticed at once some unauthorized withdrawals from the account. P.W.1. said he also asked to see Ledger Card for Account No.055694 in the name of “Haston Nigeria Limited” (of which he was also a sole signatory). From it he also noticed large unauthorized withdrawals.

P.W.1. then demanded to see the cheques on which the amounts were withdrawn on both accounts. The cheques were brought at random and he discovered that most of those cheques brought bore signatures with no resemblance to his. The amount involved in the cheques so brought went in excess of N500, 000.00. P.W.1. immediately informed 2nd defendant that the cheques were forged and the signatures were obviously not his own. P.W.1. testified further that besides one cheque for N225, 000 made payable to the 1st defendant all the other cheques were made payable to one Oluwaseyi Fabelurin. The 2nd defendant then asked P.W.1., what he was going to do, and that one replied that he was going to report the matter to the police and instruct his Solicitors, and he later did so.

However, P.W.1, later wrote to the 1st defendant for attention of 2nd defendant confirming what he discussed with him, namely that the cheques he showed to him (P.W.1.) were forged cheques, and that 2nd defendant should immediately credit the relevant account with the amount on the forged cheques he had seen. P.W.1. also demanded that 2nd defendant should make available to him at his (P.W1’s) expense the statement of account and all cheques and other instruments drawn on the accounts from 1/1/91 to that date in respect of all the accounts mentioned i.e., Account No.05604, 5474, 5475, 2192 and 05756. According to P.W.1, in his evidence, he had demanded the statements of accounts and photocopies of all the Instruments to enable him determine the scope of the fraud on those Accounts. According to P.W.1. On 31/3/93, he lodged a complaint at the state C.I.D. and followed it up with formal letter of complaint to the Commissioner of Police. P.W.1. also instructed his Solicitors Messrs Kanu Agabi and Associates who wrote to the Defendants advising them to credit the various Accounts up to the various sums on the forged cheques. In reply to P.W.1’s own letter the Bank (1st defendant) wrote to him through their own Solicitors, Messrs Aniekan & Associates accusing him of colluding with Oluwaseyi Fabelurin to steal his own money, and was threatened with libelling the defendants. They also threatened to sue P.W.1’s Solicitors for libel. In addition to all the steps mentioned above, P.W.1, said he also instructed a firm of Chartered Accountants – Messrs Babingster-Asharger & Co. of Calabar to audit all the aforementioned accounts. He also wrote to the defendants informing them of the appointment of the above firm of Chartered Accountants to audit the said accounts, and solicited their co-operation, but the said co-operation was never given, as a result of which the Accountants had to abandon their assignment. The defendants had still refused to give to plaintiff any statement of their account, as a result of which they were unable to know whether any or all the cheques drawn on all their accounts including Account No.05474 were genuine or not. In due course the plaintiff instituted this action, claiming as already set out above. At the trial evidence was given under cross examination that P.W.1, personally completed all the forms necessary to open the Account No.5474 which is the same thing as Account No.05474. The Mandate Card showing specimen signature of P.W.1, as Sole Signatory was also tendered in evidence.

In response to the above the defendants made a 17 para, statement of defence in which they alleged that the plaintiff was not a limited liability company and was not a body known to the law which can sue or be sued and would at the trial be put to the strictest proof of its status. It was stated further that the plaintiff was not known to the 1st defendant as its customer at its Calabar Branch, as “Emostrade Limited” was not its customer. It was also averred that the 1st defendant owed no obligation to furnish statement of account to the plaintiff for the mere asking and without any offer of the fee or cost therefor.

It was also contended that the defendants owe no contractual duty to the plaintiff to avail him with statement of account and cheques/other instruments drawn on the plaintiffs account if any once the said cheques/other instruments were paid. At any rate even if such a duty existed the plaintiff did not make a demand timeously and was estopped from suing on it.

Finally, it was alleged that the 1st defendant discharged its duty to the plaintiff, if any and that all necessary statements of accounts were sent to the plaintiff even without its request and also at its request, through his accountant one Oluwaseyi Fabelurin.

At the trial, each side fielded only one witness. The plaintiff fielded its Chairman, Chief Victor Ndoma Egbaas P.W.1, while the 1st defendant fielded one Christian Udechukwu Okuka, their “Recoveries and Litigation Officer, Calabar Branch, as D.W.1. D.W.1 while contending in his evidence that “Emostrade Limited” was not their customer, as no Certificate of Incorporation was deposited with them, he nevertheless admitted that there was an Account No.5474, in the name of “Emostrade Limited”. He testified that “Account No.5474 is our Account Number allocated to the customer Emostrade is our customer. Chief Victor Ndoma-Egba is only signatory to Account No.5474…

The certificate that Emostrade is a business name is in the file.”

At the conclusion of evidence and address, the learned trial Judge, ITA, J. took a hard look at all the evidence adduced before him, and came to the conclusion that:

“a trading account was blocked making it impossible for the Account holder to operate the Account. This was recognised as a breach of contract between the customer and the Bank.”

He therefore awarded damages assessed at N2, 500,000 as adequate compensation for the plaintiff in the circumstances of this case.

Against the above judgment the defendants were dissatisfied and so appealed to this court on four grounds from which the following three issues for determination were formulated. The defendants will hereinafter be referred to as the appellants.

“In our humble view the following issues call for determination in this appeal.

(i) Whether the existence of the plaintiff as a legal person qua a limited liability company capable of suing the defendants was established at the trial.

(ii) Whether the plaintiff if it is a legal person capable of suing the defendants had at the trial established by evidence any privity of contract between it and the defendants to sustain the suit.

(iii) Whether (if the plaintiff is a legal person and proved the privity of contract) the plaintiff also proved any breach of contract against the defendants to warrant an award of N2, 500,000.”

The plaintiff, who will hereinafter be referred to as respondent, also filed a brief in which they adopted the three issues formulated by the appellants, and also formulated an additional one as follows:-

“Whether the errors alleged concerning the judgment of the learned trial Judge, even if detected by this court, are sufficient to warrant a reversal of the trial court’s judgment as sought by the Appellant.”

I have carefully considered all the four issues formulated above and consider them adequate for the resolution of this appeal. I shall therefore proceed to do so as follows:-

“Re issue (i)

“Whether the existence of the plaintiff as a legal person qua a limited liability company capable of suing the defendants was established at the trial.”

Under this issue it was contended on behalf of the appellants by their learned Senior Counsel, Udechukwu, S.A.N. in their brief that the learned trial Judge at the court below erred in law when he entered judgment for the plaintiff whose legal existence was challenged but was never established. It was then pointed out that the plaintiff did not tender its Certificate of Incorporation. Exhibits 16 and 27 produced by the defendant showed beyond the shadow of a doubt that the plaintiff was not the holder of the account upon which it based its suit. It was then submitted that the finding by the court below that the plaintiff was a legal person was perverse and untenable.

In reply to the above it was submitted that the learned trial Judge used the appellant’s amended statement of defence to reach the conclusion that the appellants had therein pleaded enough to indicate unequivocal acknowledgement of the plaintiff, as a limited liability company, and why in the circumstances, the respondent had no duty to engage in the superfluous proof demanded by the appellants that he was indeed incorporated. The issue of the plaintiff’s incorporation and consequent “existence” was for that trial a non-issue because what was admitted needed no proof.” (S.75 of Evidence Act. 1990).

I have carefully considered the two arguments canvassed above and must say that regardless of whether the respondent was duly incorporated as a limited liability company or not, there can be no question of his being a legal person or a juristic person in this case. That is because respondent’s name on the writ of summons “EMOSTRADE LIMITED” is prima faciei a limited liability company, and therefore a juristic person. See the case of Agbonmagbe Bank Ltd. v. General Manager G. B. Ollivant Limited & Anor (1961) 1 All NLR (Pt.1) 116 where in a Statement of Claim 1st defendant was named as “General Manager, G. B. Ollivant Ltd.” Preliminary objection that such name was not of a person known to law; such a person could not be sued, and ought to be struck out of the action. It was held that there was no misnomer of 1st defendant as that was not a case where the defendant had been sued in a wrong name. First defendant was not a juristic person, and as such could not be sued. First defendant’s name was accordingly struck out from the action. It was further held that in case of misnomer, if application was made to amend the writ by substituting the proper name, it should be granted.

In the instant case, the appellants who were the defendants were not complaining that they had no juristic personality, and so should be struck out of the action. They also did not file any preliminary objection at the court below for the plaintiff to be struck out of the suit for being a non-juristic person, which could have been the end of the matter.

In any case, regardless of whether the respondent was or was not a limited liability company, on the appellants’ own admission, the respondent was a partnership. It was a Registered Business Name. It was also accepted by the appellants themselves that the Account No.05474 was their own and was held by Chief Victor Ndoma Egba (P.W.1.) who was the sole signatory to the account. So what were the appellants quarrelling about? That respondent did not incorporate his business under the Companies & Allied Matters Act 1990. And how did that prejuce them? And in what way did the appellants suffer any loss? None. To put it briefly, this was, in my respectful view a case of misnomer of plaintiff, which with leave of the Court could be cured by amendment. The writ of summons could have been amended by showing the plaintiff to be “Chief Victor Ndoma-Egba (Trading under the Name and style of “Emostrade”.) This is if truly the plaintiff had not been incorporated. But, if, on the other hand the respondent had actually been incorporated, but failed for one reason or the other to lodge his certificate of incorporation with the bank, that should not be any business of the appellants, as long as the same man was still the signatory to the Account. Finally, on this issue, one must refer to the recent case of A. B. Manu & Co. v. Costain (W.A.) Ltd. (1994) 8 NWLR (Pt. 360) 112, where the appellant had contended that he knew the respondent as “Costain (West Africa) Ltd., and not as “Costain (W.A.) Ltd.” It contended therefore that the respondent was not competent to institute the action in the name it proffered.

In unanimously dismissing the appeal, it was held inter alia as follows by the Court of Appeal, Lagos Div.

“Misnomer can be said to be a mistake in name – giving incorrect name to person(s) in the writ of summons. It occurs when a mistake is made as to the name of a person who sued or was sued or when an action is brought by or against the wrong name of a person. In the instant case, going by the facts contained in “Exhibit 31” of a letter written by the appellant to the respondent, the words “West Africa” were therein abbreviated. It cannot therefore be said that the appellant did not know that Costain (W.A.) Ltd means no other thing, that Costain (West Africa) Limited.

In conclusion it was held at P.121 of the report as follows:-

“On Nature of misnomer that can vitiate proceedings:-

When both parties are quite familiar with the entity envisaged in a Writ of Summons, and could not have been misled or have any real doubt or misgiving as to the identity of the person suing, then there can be no problem of mistaken identify to justify the striking out of the action. Misnomer that will vitiate the proceedings would be such that will cause reasonable doubt as to the identity of the person intending to sue or be sued.

In the instant case, both parties are ad idem as to the identity of the party suing, that is the respondent and there is no misnomer whatsoever of a nature that could vitiate the proceedings at the trial court”.

In view of the foregoing, I hold the view that the name of the respondent on the writ was a mere misnomer which did not and could not vitiate the proceedings. Issue No.1, must therefore be resolved in favour of the respondent.

Re Issue (ii)

“Whether the plaintiff if it is a legal person capable of suing the defendants had at the trial established by evidence any privity of contract between it and the defendants to sustain the suit.”

Under this issue, the main point canvassed on behalf of the appellants was that a limited liability company was known only by the name by which it is incorporated (Section 37 of the Companies and Allied Matters Act, 1990 was cited in support).

It was only in that name that it could contract or do business. It was then submitted that the respondent having failed to produce its certificate of incorporation, if indeed it had one, there was no proof that as at the date the account was opened which was 18th May, 1987 (as per Exhibit 17) there was in existence any company called Emostrade Ltd. which could contract with anyone of the defendants. It was further submitted that the plaintiff company, even if it existed, not being the holder of account No.05474, could not compel the defendants to give it any information relating to that account, and cannot sustain a suit to enforce such an obligation or to claim damages for breach of contract by virtue of purported refusal by the appellants to oblige it. (The case of U.B.N. Ltd. v. Penny-Mart Ltd. (1992) 5 NWLR. (Pt.240) 228 at 240 was cited in support.

In reply to the above it was submitted that evidence of Privity of contract between the plaintiff and the defendants at the trial were replete. Simply put, the privity of contract that the appellants would be searching for will be no more than a convincing nexus between both parties to show that the defendants held something of the plaintiff, over which that plaintiff could complain, and to which complaints the appellants ought to be answerable, or at least sensitive. Reference was then made to the evidence of D.W.1, at p.47 lines 16-19 of the records to show that all the above requirements were established. At the said p.47 of the records, D.W.1, was recorded as saying as follows:-

“Account No.5474, yes there is and is in the name of Emostrade Ltd. Ledger is with the bank.”

Attention was also drawn to the evidence of the same D.W.1, at p.47 lines 23 – 27, where he said that there were other documents relating to account No.5474, but which were not tendered to show that Emostrade was different from Emostrade Ltd. The court was therefore urged to overrule the submissions of the appellant under this issue and disallow the appeal.

I have carefully considered all the arguments canvassed above by learned counsel on both sides, and must first observe that the admission of D.W.1 under cross-examination at p.47 of the records that:

“Accounts No. 5474, yes there is and in the name of Emostrade Ltd. Ledger is with the bank.”

had hit me like a bolt from the blues, because it ran counter to the case of the appellants as stated in their pleadings, especially paragraph 5, which reads as follows:-

“The plaintiff is not known to the 1st defendant as its customer at its Calabar Branch. Emostrade Limited is not its Customer”.

It is our law that evidence that was not pleaded goes to no issues, and should be ignored (Emegokwe v. Okadigbo (1973) 4 S.C. 113 at 117). On the other hand, there is a presumption in our law that the record of proceedings in a case is deemed to be correct; especially as there has been no application to rectify any inaccuracy in it. An appeal should be fought on the basis that the record is correct. Ehikioya v. C. O. P. (1992) 4 NWLR (Pt.233) 57 at 74; and Ojeme v. Momodu (1994) 1 NWLR (Pt.323) 685 at 697.

Be that as it may, it is my firm view that even if one is to ignore the unfortunate admission at p.47 of the record, and go by what has been the case of the appellants all along, namely that their account No.05474 is held by “Emostrade” and not by the present plaintiff who calls himself “Emostade Ltd” one will still come to the inevitable conclusion that there is or was privity of contract between the appellants and the respondent, and that the respondent has a locus standi in this case. This is so because it is common ground (from the records) that respondent first opened account No.05474 in 1981 under his personal name of “Victor Ndoma-Egba” simpliciter. As an individual, he was the sole signatory to that account. Then in 1987 he converted himself into a sole partnership under the business name of Emostrade. In this new name he continued to be the sale signatory as Victor Ndoma-Egba. This Victor Ndoma Egba is the P.W.1, in this case. Then on a date that has not been specified, P.W.1, once more converted himself into a limited liability company under the name of “Emostrade Limited” with Victor Ndoma-Egba (P.W.1.) as its Chairman and also still the sale signatory. In the normal course of events P.W.1, should have informed his bankers (the appellants) about his change in status or incorporation into a limited liability company, and also would have been required to lodge a copy of his certificate of incorporation with them. But for a reason that was not known, these steps were not taken before the incidents leading to this appeal took place. The question then arises. What prejudice if any have the appellants suffered as a result of the failure of respondent to inform them of his new status as a corporate personality? As far as anyone can see, there was none, because the relationship of Banker and Customer still subsisted between the parties. As long as that relationship existed, the appellants cannot be heard to complain that there was no privity of contract between the respondent and themselves, merely because their records had not been amended. It is common knowledge that a limited liability company is entitled to the benefit of all the pre-incorporation contracts entered into by its human agents before it was incorporated.

In the instant case, Chief Victor Ndoma Egba (P.W.1.) was clearly one of the human agents of either “Emostrade” or “Emostrade Limited”. The partnership or company was entitled to the benefit of whatever banking contract there might have been between the appellants and the respondent’s Chairman, (P.W. 1.). In this connection reference must be made to the case of New Nigeria Bank Ltd. v. Boardman Odiase (1993) 8 NWLR (Pt.310) 235. In that case the respondent had sued the appellant for N750, 000.00 being special and general damages for diverting Foreign Exchange Approval granted by the Central Bank of Nigeria for his (respondent’s) benefit to the benefit of a total stranger. The defendant/appellant later raised a preliminary objection complaining inter alia that “the plaintiff has no “locus standi” in this suit in that there was no privity of contract between the plaintiffs and the defendant.

The learned trial Judge at the Court below, Obi, J. held that respondent had a “locus standi” to sue, as he was clearly a disclosed principal while his mother, Mrs. Obasuyi and Dr. Aimuwu, through whose account the Foreign Exchange application was made, were his agents. As to whether consideration was given or not given, he held that the “charges” which the bank was bound to charge at the end of the transaction was the consideration. On appeal to us at Benin Division, we accepted and affirmed the ruling of the court below. We also added that even if there had been no breach of contract, there was a serious breach of trust. Under our law there was nothing that prevented a beneficiary from suing a trustee for breach of trust.

In view of the foregoing, I hold that since P.W.1. was clearly the agent of the respondent in all his transactions with the appellant, in respect of account No.05474, there was clearly privity of contract between respondent and the appellants to sustain the suit. Issue No. (ii) must therefore also be answered in the affirmative.

Re Issue (iii):

“Whether if the plaintiff is a legal person and proved the privity of contract) the plaintiff also proved any breach of contract against the defendants to warrant an award of N2, 500,000.”

Under this issue, the contention of the appellant was that there was no evidence on record to show that the appellants were in any way accountable to the respondent as all the documents tendered as Exhibits 1 – 15 concerned accounts said to behold by Victor Ndoma-Egba and not the respondent – Emostrade Ltd. It was also submitted that there was no evidence that the respondent suffered any loss by the appellant’s alleged refusal to submit to account. The plaintiff has not established his loss.

In response to the above, it was quickly pointed out that there was no ground of appeal that questioned award or quantum of damages – whether excessive or not; or whether awarded on correct principles of law or not.

Not having appealed against damages, it was not therefore open to the appellants to formulate an Issue that questioned award of damages.

I have carefully considered the two arguments canvassed above, and must agree with the learned counsel for respondent that an issue for determination formulated in a brief must arise and be founded on a ground or grounds of appeal filed; and parties to an appeal will not be allowed to argue any issue not covered by the grounds of appeal. Such an issue becomes irrelevant and incompetent and must be struck out.

See e.g.

  1. Onifade v. Olayiwola (1990)7 NWLR (Pt.161) 130 at 157.
  2. Momodu v. Momoh (1991)1 NWLR (Pt.169) 608 at 620 – 621.
  3. Labiyi v. Anretiola & Ors (1992) 8 NWLR (Pt.258) 139.

However, in the instant case, while there was clearly no ground of appeal against “quantum” of damages, nor even the principle of the award, there was definitely ground 3, which questioned the appropriateness of awarding damages to a person who has suffered no loss. This argument was founded on the thesis that all the documents tendered as Exbts. 1 – 15 in this case transpired between the appellants and Chief Victor Ndoma-Egba, and not with the plaintiff on record “Emostrade Ltd” This issue, I must observe is very similar to the last issue in which it was argued that there was no privity of contract between the appellants and the plaintiff – Emostrade Ltd., but with Chief Victor Ndoma-Egba. That issue was resolved in favour of the respondent because of the fact that Chief Victor Ndoma-Egbe, by virtue of being the Chairman of respondent Company, was clearly the human agent or alter ego of the respondent, who “ipso factor” was entitled to the benefit of all the pre-incorporation contracts entered into between Chief Victor Ndoma-Egba and third parties. By parity of reasoning therefore all the documents exbts 1-15, written between appellants and Chief Victor Ndoma-Egba, were “ipso facto” written between the appellants and respondent as the disclosed principal of Chief Victor Ndoma-Egba. In the same way the respondent could take the benefit of any contract entered into between Chief Ndoma-Egba and third parties, it can also take the benefit of damages awardable to Chief Victor Ndoma-Egba, who was its human agent in respect of all the transactions complained of. This issue must therefore also be resolved in favour of the respondent namely that damages were properly awarded in favour of the respondent as the principal of Victor Ndoma-Egba (P.W.1.) in this case.

With issues (i) to (iii) of appellants having been resolved in favour of the respondent it becomes unnecessary to consider the lone issue formulated by the respondent. This appeal therefore fails and is accordingly hereby dismissed with costs assessed at N3, 000.00 in favour of respondent.


Other Citations: (1997)LCN/0306(CA)

G. B. Ollivant, Ltd. V. Kwesi Baa Korsah & Anor (1941) LJR-WACA

G. B. Ollivant, Ltd. V. Kwesi Baa Korsah & Anor (1941)

LawGlobal Hub Judgment Report – West African Court of Appeal

Claimant-Appellant.

Facts

In an Interpleader action claimant appeared to sue in his personal capacity whilst in fact he was suing as a beneficiary on behalf of himself and co-beneficiaries thus violating rule 1 Order 3 of third Schedule to Supreme Courts Ordinance which states that representative capacity must be stated in the writ.

Appeal Court commented that a copy of a Will which was put in by consent and accepted though not even a Probate copy should not be thus accepted as evidence of the contents.

Robert Marmaduke Korsah owned an area of land in the centre whereof in 1928 he allowed his son the judgment debtor to build a house. In 1929 he executed a deed of Gift of the land in favour of his eon. The claimant contended that the land on which the house stood and a small portion around it was all that was included in the gift and he claims for himself and his co-beneficiaries as residuary legatees under Robert Marmaduke Korsah’s Will the remaining larger portion of the land. The description of the land in the deed of gift and in a plan attached thereto are irreconcilable. It was admitted that both portions were in judgment debtor’s possession at time of attachment but claimant claimed, under Order 44 Rule 25 (1) of Schedule 3 to the Supreme Courts Ordinance that judgment debtor was holding in trust for the claimant and his co-beneficiaries under the Will. Trial Judge found against the claimant because he did not believe claimant’s story. He held that if there was any ambiguity in the deed then the boundaries must be looked at and in any event judgment debtor had so long dealt with the whole property as his own that all were estopped from now claiming that only a portion was given.

Held

(i) That best way to resolve the latent ambiguity in the deed of gift was to look to the conduct of the parties and from their conduct it is evident that the onus of proof upon the claimant had not been discharged.

(ii) That it was not competent for the learned trial Judge to find that the claimant was estopped as it had not been pleaded.


Appeal dismissed.

Chief Secretary To The Government V. James George & Ors (1942) LJR-WACA

Chief Secretary To The Government V. James George & Ors (1942)

LawGlobal Hub Judgment Report – West African Court of Appeal

Judgement

In this case the Appellant asked the Court below and asks us to give a decision in direct conflict with the provisions of section 7 of the Ikoyi Lands Ordinance (Cap. 91) and with the decision of the Privy Council in the case of Bakare Ajakaiye and Others v. Lieutenant-Governor Southern Provinces (29 A.C. 679). The Court below declined to do so, and we must also decline.

The Appeal is dismissed with costs assessed at 20 guineas in favour of the Plaintiff-Respondent ;

13 guineas in favour of James George ;

10 guineas in favour of P. H. Williams, T. K. E. Phillips and Madam Barikisu Abebi jointly ;

10 guineas in favour of Mrs. Remilekun Akinsemoyin, J. St. Mathew Daniel and N. S. Dedeke jointly ;

10 guineas in favour of J. T. Nelson Cole, E. 0. Moore, P. H. Williams and E. Ewtuni Macarthy jointly ;

all to be paid by the Defendants-Appellants.

James Ayanshina V. Commissioner Of Police (1951) LJR-WACA

James Ayanshina V. Commissioner Of Police (1951)

LawGlobal Hub Judgment Report – West African Court of Appeal

Additional charge added by Magistrate at late stage in proceedings—Section430 (1) of Criminal Code considered—Conviction of unlawful possession afteracquittal on charge of receiving stolen goods—Insufficient evidence to justify charge.

Facts

Before indicating his opinion that there was no case to answer on a charge of receiving stolen property, the Magistrate, in exercise of his powers under section 430 (1) of the Criminal Code, added a charge of being in unlawful possession of goods reasonably suspected of having been stolen.

The appellant was acquitted on the charge of receiving and his co-defendant was also acquitted on the charge of theft. In this case what was suspected by the prosecution was that the appellant’s co-defendant had stolen the goods and that the appellant had received them, knowing them to have been stolen.

Counsel for the appellant argued that at that late stage in the proceedings the Magistrate had no power to add this count. It was further argued that in view of the acquittal of the appellant and his co-defendant on the original charges the conviction of unlawful possession could not be sustained.

Held

Section 430 (1) of the Criminal Code empowers the Court to add a charge at any stage before the judgment, and the Magistrate, having added the charge before ruling there was no case to answer, had acted within his powers.

Held further, the basis of the reasonable suspicion of unlawful possession was that the appellant’s co-defendant had stolen the goods and that the appellant had received them. The acquittal of the appellant and co-defendant on those charges disposed of that suspicion and the conviction could not be sustained.


Appeal allowed.

Daniel Adenijga V. Lagos Town Council (1950) LJR-WACA

Daniel Adenijga V. Lagos Town Council (1950)

LawGlobal Hub Judgment Report – West African Court of Appeal

Injunction to restrain Town Council from demolishing a building—Power
to demolish taken under bye-laws by notice—Further notification substituting
different terms—In pleadings Counsel relied on second notice—Rights under
original notice lost.

Facts

In the Court below the appellant lost his action for an injunction restraining the Lagos Town Council from demolishing the whole of a building erected in contravention of the Township Bye-Laws.

The Council gave notice to the appellant dated the 15th March, 1948, to remove a certain building, and if he failed to do so within twenty-one days the demolition would be carried out by the Council. Subsequently the appellant was prosecuted and found guilty of a breach of the Township Bye-Laws. Thereafter, on the 27th July, the Council sent a further notification to the appellant to the effect that, subject to his complying with the terms of this second communication, the Council would not exercise their power of removing the whole building.

Counsel for the appellant argued on this appeal that the second notification of the 27th July was a notice within the appropriate bye-law and that it would be the sole authority for the demolition of the building.

The respondents in their pleadings had relied on the notice of the 27th July, but their Counsel argued on this appeal that they were still entitled to act under the notice of the 15th March.

Held

The respondents were bound by their pleadings and could not set up an entirely different case at the trial in Court or on this appeal. The powers reserved to the Council by the second notification of the 27th July were not sufficiently wide to authorise them to demolish the whole building. An injuncnon restraining the respondents from demolishing the whole building was accordingly granted.


Appeal allowed.

TRIGGER – Excess Insurance Company Limited v Amec plc

TRIGGER – Excess Insurance Company Limited v Amec plc

before

Lord Phillips, President

Lord Mance

Lord Kerr

Lord Clarke

Lord Dyson

JUDGMENT GIVEN ON

28 March 2012

Heard on 5, 6, 7, 8, 12, 13, 14 and 15 December 2011

Appellant
Roger Stewart QC
Stephen Robins
(Instructed by DLA Piper UK LLP)
Respondent
Colin Wynter QC
Alison McCormick
(Instructed by Irwin Mitchell)
 
 
 
AppellantRoger Stewart QCStephen Robins(Instructed by DLA Piper UK LLP)Respondent
Edward Bartley Jones QC
Digby Jess
(Instructed by Weightmans LLP)
AppellantMichael Beloff QCRichard Harrison(Instructed by Hill Hofstetter LLP)RespondentColin Edelman QCDavid Platt QCPeter Houghton(Instructed by Plexus Law)
AppellantMichael Beloff QCRichard Harrison(Instructed by Berrymans Lace Mawer)Respondent
Colin Edelman QC
David Platt QC
Peter Houghton
(Instructed by Plexus Law)
 
 
 
Appellant
Roger Stewart QC
Stephen Robins
(Instructed by DLA Piper UK LLP)
RespondentColin Wynter QCTimothy Smith(Instructed by John Pickering and Partners)
AppellantHoward Palmer QCSonia Nolten(Instructed by Watmores)1st RespondentJeremy Stuart-Smith QCLeigh-Ann Mulcahy QCClare Dixon(Instucted by Buller Jeffries)2nd RespondentMichael Beloff QCA John Williams(Instructed by Kennedys & Berrymans Lace Mawer)
Appellant
Jeremy Stuart-Smith QC
Leigh-Ann Mulcahy QC
Clare Dixon
(Instructed by Buller Jeffries)
RespondentHoward Palmer QCSonia Nolten(Instructed by Watmores)
AppellantMichael Beloff QCA John Williams(Instructed by Kennedys & Berrymans Lace Mawer) RespondentColin Edelman QCDavid Platt QCPeter Houghton(Instructed by Plexus Law)
IntervenerJeremy Johnson QCElliot Gold(Instructed by DWP/DH Legal Services)

LORD MANCE (WITH WHOM LORD KERR AGREES)

Introduction

  1. The liability of employers for deaths caused by mesothelioma has pre- occupied courts and legislators over recent years. The present appeals concern claims to pass the burden of this liability on to insurers, made either by employers or in the case of insolvent employers by the personal representatives of former employees using the mechanism of the Third Party (Rights against Insurers) Act 1930.
  1. The appeals concern employers’ liability insurance. This is in contrast with Bolton MBC v Municipal Mutual Insurance Ltd [2006] EWCA Civ 50, [2006] 1 WLR 1492 where public liability insurance was in issue. Employers’ liability focuses necessarily upon the relevant employment relationships and activities. Public liability relates to any of the insured’s relationships and to activities affecting the world at large. Another feature of employers’ liability is that, under the Employers’ Liability (Compulsory Insurance) Act 1969 (the “ELCIA”), it has since 1 January 1972 been compulsory for every employer other than local authorities carrying on any business in Great Britain to

“insure, and maintain insurance, under one or more approved policies with an authorised insurer or insurers against liability for bodily injury or disease sustained by his employees, and arising out of and in the course of their employment in Great Britain in that business, but except in so far as regulations otherwise provide not including injury or disease suffered or contracted outside Great Britain …”

  1. The appeals arise because the relevant insurers maintain that the employers’ liability insurances which they issued respond (or, better, could only have responded) to mesothelioma which developed (or, possibly, manifested itself) as a disease during the relevant insurance periods – all long past. In contrast, the relevant employers and personal representatives maintain that the insurances respond to mesothelioma which develops and manifests itself later; all that is required, they say, is exposure of the victim during the insurance period to asbestos in circumstances where the law attributes responsibility for the mesothelioma to such exposure. These alternative bases of response (or “triggers” of liability) have been loosely described as an occurrence (or manifestation) basis and an exposure (or causation) basis. It is in issue whether the ELCIA, after it

came into force, mandated any particular basis of response. A secondary issue, arising if the insurances only respond on an occurrence basis, is whether the aetiology of mesothelioma justifies a conclusion that there was during the relevant insurance period an occurrence sufficient to trigger liability under the insurances.

  1. Burton J, [2008] EWHC 2692 (QB), concluded that the relevant insurances all responded on an exposure basis. The Court of Appeal, [2010] EWCA Civ 1096, by a majority (Rix and Stanley Burnton LJJ), upheld the judge in relation to some of the insurances (particularly those covering disease “contracted” during the relevant insurance period); but they concluded that others (particularly those covering disease “sustained” during the insurance period) responded only on an occurrence or manifestation basis. Smith LJ would have upheld the judge’s judgment in its entirety. The full judgments in both courts repay study. They have been of great assistance to this court and make it possible to go directly to the heart of the issues.
  1. “Mesothelioma is a hideous disease that is inevitably fatal. In most cases, indeed possibly in all cases, it is caused by the inhalation of asbestos fibres”: Sienkiewicz v Greif (UK) Ltd [2011] UKSC 10, [2011] 2 AC 229, para 1, per Lord Phillips. It is a cancer of the pleura, which are thin linings around the lungs and on the inside of the rib cage. It is usually undetectable until shortly before death. Its “unusual features” include what Burton J in this case at para 30 described as “the unknowability and indescribability” of its precise pathogenesis. In particular, it is impossible to know whether any particular inhalation of asbestos (at least any occurring more than ten or so years prior to diagnosability) played any or no part in such development. Because of this unusual feature, the law has developed a special rule. The special rule was the product of judicial innovation in Fairchild v Glenhaven Funeral Services Ltd [2002] UKHL 22; [2003] 1 AC 32 and in Barker

v Corus UK Ltd [2006] UKHL 20; [2006] 2 AC 572. It was modified by statutory intervention in the form of the Compensation Act 2006, section 3. Leaving aside exposures occurring within the ten or so years prior to diagnosability, the rule can now be stated as being that when a victim contracts mesothelioma each person who has, in breach of duty, been responsible for exposing the victim to a significant quantity of asbestos dust and thus creating a “material increase in risk” of the victim contracting the disease will be held to be jointly and severally liable in respect of the disease.

  1. Burton J’s findings in the present case justify certain further propositions, mostly also corresponding with the summary in Lord Phillips’ judgment in Sienkiewicz (para 19):
  1. A significant proportion of those who contract mesothelioma have no record of occupational exposure to asbestos. The likelihood is that

in their case the disease results from inhalation of asbestos dust that is in the environment. There is, however, a possibility that some cases of mesothelioma are “idiopathic”, i.e. attributable to an unknown cause other than asbestos.

  1. The more fibres that are inhaled, the greater the risk of contracting mesothelioma.
  2. There is usually a very long period between the exposure to asbestos and the development of the first malignant cell. Typically this can be at least 30 years.
  3. For a lengthy period (perhaps another five years) after the development of the first malignant cell, there remains a possibility of dormancy and reversal, but at a point (Burton J thought a further five years or so before the disease manifested itself, and was thus “diagnosable”) a process of angiogenesis will occur. This involves the development by malignant cells of their own independent blood supply, so assuring their continuing growth.
  4. The mechanism by which asbestos fibres cause mesothelioma is still not fully understood. It is believed that a cell has to go through 6 or 7 genetic mutations before it becomes malignant, and asbestos fibres may have causative effect on each of these.
  5. It is also possible that asbestos fibres have a causative effect by inhibiting the activity of natural killer cells that would otherwise destroy a mutating cell before it reaches the stage of becoming malignant.

Mesothelioma currently claims about 3000 lives a year in the United Kingdom. This speaks to the common use of asbestos materials up to the 1960s and 1970s.

  1. In Annex I to his judgment Rix LJ set out the insuring clauses of the various forms of policy wording in use from time to time. Subject to re-ordering to reflect the development of the language, Annex A to this judgment includes the same and some further wording. It can be seen that the Excess policies and the first two MMI policies promise to indemnify the insured employer against liability “if at any time during the period” of insurance (or of any renewal) any employee shall sustain under the earlier policies “personal injury by accident or disease” or under the later policies “[any] bodily injury or disease” – in the case of the first Excess policy while engaged in the service of the Employer or in other cases “arising out of and in the course of [his] employment by the” insured employer.
  1. In the case of the Independent policy, the insurer, under the recital, promised to indemnify the employer during the period of insurance or of any renewal. The insuring clause itself contains no express limitation to any period. It promises indemnity against all sums for which the employer shall be liable for damages for such injury or disease if any employee “shall sustain bodily injury or

disease arising out of and in the course of his employment by the Insured in connection with the Contract specified or type of work described in the Schedule”.

  1. The third MMI policy and the BAI policies were in more developed form. The former promises indemnity in respect of legal liability for sums payable as compensation for bodily injury or disease (including death resulting from such bodily injury or disease) “suffered” by any employee “when such injury or disease arises out of and in the course of employment by the Insured and is sustained or contracted during the currency of this Policy”. The latter promised indemnity against all sums “which the Insured may become liable to pay to any Employee …. in respect of any claim for injury sustained or disease contracted by such Employee” during the period of insurance or any renewal.
  1. The insurers party to the present appeals have at all times represented only a small part of the employers’ liability insurance market. By far the larger part of the market consists of companies who until the late 1960s (when competition rules intervened) operated a tariff system which bound them to adopt a specified policy form and specified rates. Until 1948 tariff insurance was focused on Workmen’s Compensation Act claims, but in 1948 legislative changes (in particular the abolition by the Law Reform (Personal Injuries) Act 1948 of the doctrine of common employment) made a common law claim for future accruing causes of action much more attractive. It may well have been in anticipation of these changes that the tariff companies introduced a new form of policy in May 1948, still in widespread use today, providing indemnity if any employee “shall sustain any personal injury by accident or disease caused during the period of insurance”. Under this tariff wording, “sustain” looks to the occurrence of an accident or development of a disease at any time, while “caused” makes clear that the trigger to cover is that the accident or disease has been caused during the insurance period. The present insurers were non-tariff companies, and have always been free to set their own wordings. From dates after the insurances the subject of this appeal, three of the insurers in fact ceased to use the wordings set out in Annex A, and themselves moved expressly to causation based wordings – Excess in about 1976, Independent in the mid-1980s, and BAI in 1983. As a matter of insurance practice, however, until the decision in Bolton in 2006, all these wordings, whether tariff or non-tariff and whether using the language “caused”, “sustain” or “sustained or contracted”, paid out on long-tail claims (including the mesothelioma claims which became increasingly frequent in the 1980s) by reference to the date(s) of exposure. Where successive employers with different insurers had exposed a particular employee-victim to asbestos, liability was in practice apportioned between the employers, and so insurers, broadly according to the extent of exposure for which each employer was responsible.

The rival cases

  1. Insurers submit that all the wordings in Annex A require the injury or disease to occur during the period of insurance or of any renewal. In the alternative, if the use of the word “contracted” in the third MMI policy and the BAI policies or the different formulation of the Independent policy leads to any different conclusion in any of such cases, they submit that this leaves unaffected the clear meaning of the Excess and first two MMI policy wordings. The employers and interested employees contend that all these policies are to be understood as operating on an exposure or causation basis.
  1. The implications of these alternative interpretations are clear. On insurers’ primary contention, the policies set out in Annex A would not respond to current mesothelioma claims. It is unlikely that most of them would have responded to many, if any, mesothelioma claims, since it was only in the 1980s that such claims began to emerge to any great extent. Policies written on a causation basis since the dates indicated in paragraph 10 above would also not respond to current mesothelioma claims. Insurers’ response is that any insurance must be read according to its terms. Until 1 January 1972, when the ELCIA came into force, it was not obligatory for employers to have any form of employers’ liability insurance. Further, viewed on an occurrence or manifestation basis, the policies would pick up long tail claims arising from exposure occurring at any time in the past. In this connection, it is to be noted that various long tail diseases were well- recognised perils from the era of Workmen’s Compensation legislation before 1948. Instances were scrotal cancer, pneumoconiosis and more specifically (from the time of Merewether and Price’s 1930 Report on Effects of Asbestos Dust on the Lungs and Dust Suppression in the Asbestos Industry) asbestosis. All these would only develop over and could manifest themselves after considerable periods of years. Following upon the 1930 report, The Asbestos Industry Regulations 1931 (SI 1931/1140) were introduced to regulate factories handling and processing raw fibre, and in 1969 The Asbestos Regulations 1969 (SI 1969/690) extended this regulation more widely – it appears in the light of an appreciation that mesothelioma could result from exposure to small quantities of asbestos dust (see In re T & N Ltd (No 3) [2006] EWHC 1447 (Ch), [2007] 1 All ER 851, para 118).

The Court of Appeal’s conclusions

  1. The force of insurers’ case rests in the use of the word “sustain”, whether in connection with the phrase “personal injury by accident or disease” or “bodily injury or disease” or in the conjunction “injury or disease …. sustained or contracted” or “injury sustained or disease contracted”. Rix and Stanley Burnton LJJ concluded that the word “sustain” looked prima facie at the experience of the suffering employee rather than its cause (paras 232 and 343). Insurances

responding to injury or disease sustained during the insurance period would not, on this basis, cover mesothelioma sustained long afterwards. Rix LJ had some compunction about the result because of what he (though not Stanley Burnton LJ) felt was a tension with the commercial purpose of employers’ liability insurance in the extraordinary context of mesothelioma (para 235).

  1. Rix LJ would have liked to hold that mesothelioma sufferers sustained sufficient injury on exposure to asbestos to trigger the insurances in force at the date of such exposure, but felt bound by Bolton to conclude the contrary (paras 277-289).
  1. However, Rix LJ, though not Stanley Burnton LJ, considered that the particular wording of the Independent insurances did not explicitly require the injury or disease to be sustained during the insurance period, and could be read as covering the sustaining of injury at any time arising out of and in the course of employment during the insurance period (paras 300 and 350).
  1. Rix and Stanley Burnton LJJ differed as to the significance of the ELCIA extension provisions included in the Independent wording, the third MMI wording and the second BAI wording, as quoted in Annex A. Rix LJ thought that the ELCIA required employers to insure on a causation basis (paras 184 and 186) – although, since he also expressed the view that an insurance arranged and maintained on a sustained basis could comply with the ELCIA, he may perhaps only have meant “required in practice”. At all events, he held that the ELCIA extension provisions covered liability incurred to the personal representatives of employees on a causation basis, while enabling insurers to recoup themselves so far as possible from the relevant employers in respect of liability they would not otherwise have had to meet (paras 292, 300 and 302). Stanley Burnton LJ did not agree that the ELCIA required causation wording (para 342), but considered that it required insurance to be taken out and maintained in respect of ex-employees, or at least those who were or had been employed at any time after the coming into force of ELCIA (para 342; and see Rix LJ’s comments at paras 305-307).
  1. Rix, Smith and Stanley Burnton LJJ were all agreed that, where provision was made for disease “contracted”, this could and should be construed as introducing cover on a causation basis, even if or though wording such as injury (or disease) “sustained” could only respond on an occurrence basis.

Analysis

  1. Annex A sets out the insuring clauses. Insurers’ case is, as I have said, rooted most strongly in the word “sustain”, particularly when it is used by itself, rather than in conjunction with a more ambivalent alternative in the phrase “sustained or contracted”. The natural meaning of the word “sustain”, taken in isolation and as defined in the Shorter Oxford English Dictionary from an appropriate date (1965, 3rd ed), is, with respect to injury, “undergo, experience, have to submit to”, or, possibly, “to have inflicted upon one, suffer the infliction of”. But the insurance cover granted (and no doubt required) extended expressly beyond injury by accident to embrace disease. This was achieved by less natural conjunctions, such as “sustain [any] personal injury by accident or disease” or “sustain [any] bodily injury or disease”. Conscious perhaps that the verb sustain does not fit naturally with the concept of disease, some companies (MMI in its third wording and BAI in its first and second wordings) introduced the different verb “contracted” in the formulations “sustained or contracted” or “injury sustained or disease contracted”. This use of “contracted” with respect to disease is considerably more natural, but is clearly open to an interpretation that it looks back to the initiating or causative factor of the disease, and (whatever the answer on that point) highlights a question whether any substantial difference exists in this connection between such wordings and other wordings referring more awkwardly to the sustaining of personal injury by disease or the sustaining simply of disease.
  1. To resolve these questions it is necessary to avoid over-concentration on the meaning of single words or phrases viewed in isolation, and to look at the insurance contracts more broadly. As Lord Mustill observed in Charter Reinsurance Co Ltd v Fagan [1977] AC 313, 384, all such words “must be set in the landscape of the instrument as a whole” and, at p 381, any “instinctive response” to their meaning “must be verified by studying the other terms of the contract, placed in the context of the factual and commercial background of the transaction”. The present case has given rise to considerable argument about what constitutes and is admissible as part of the commercial background to the insurances, which may shape their meaning. But in my opinion, considerable insight into the scope, purpose and proper interpretation of each of these insurances is to be gained from a study of its language, read in its entirety. So, for the moment, I concentrate on the assistance to be gained in that connection.
  1. A first point, made very clearly below by Rix LJ (para 263), is that the wordings on their face require the course of employment to be contemporaneous with the sustaining of injury. This leaves open what is meant either by “sustaining” or by “injury”. Rix LJ thought that the Independent wording could be understood differently – in effect, as if it had expressly read: “If any person who is under a contract of service or apprenticeship with the Insured shall at any time sustain bodily injury or disease arising out of and in the course of his employment by the

Insured during the policy period in connection with the Contract specified or type of work described in the Schedule ”. That interpretation assumes that “sustain”

in this context equates with the occurrence, rather than causation, of the injury or disease, and only arises for consideration if that assumption is correct.

  1. A second point is that the insurance wordings demonstrate a close link between the actual employment undertaken during each insurance period and the premium agreed to be payable for the risks undertaken by insurers in respect of that period. Premium is linked expressly to actual wages, salaries and earnings during the insurance period under the Excess policies, the first MMI wording and the BAI policies. The second and third MMI wordings contemplate that premium may be linked to wages, salaries and earnings, and, to the extent that any inference regarding the general nature and scope of cover under these standard wordings can be drawn from such a link, it must be capable of being drawn whether or not premium was actually so linked in any particular case. As to the Contractors’ Combined Policy issued by the Independent, it is a probable inference that the estimates which were provided and were to be updated will have included, in respect of the employers’ liability cover in section 1, wages, salaries and other earnings paid. Finally, the Independent cover is linked to the actual contract or work which the employer is undertaking during the insurance period.
  1. These links are in my view significant. True, premium may sometimes be calculated on a rough and ready basis. Minor discrepancies between the premium calculation and the risk may be understandable: see e.g. Ellerbeck Collieries, Ld v Cornhill Insurance Co [1932] 1 KB 401, 418, per Greer LJ (who pointed out that any such discrepancy there was more apparent than real, since workmen not earning wages because off-work would not actually be at risk of any fresh accident, even though they would remain susceptible to certification for disablement). Here the position is quite different. Great care is taken in all the policies to tie premium to the actual employment undertaken during the insurance period, and in the case of the Excess, Independent and MMI policies to tie cover to a business, contract or activities described in the schedule. The natural expectation is that premium is measured by reference to actual employment or work during the insurance period because it is the risks attaching to such employment or work which are being undertaken by insurers. At the very least, the drawing of this link makes improbable the contention advanced by some of the insurers that the present insurances were apt to pick up liabilities emerging during the insurance period which could be attributable to employment and activities undertaken and negligent conduct committed at times long-past. The number of employees, their employment activities and the risks involved at those times could be very different.
  1. The significance which attaches to the employment current during the insurance period is underlined by legal and practitioner texts. As long ago as 1912, MacGillivray on Insurance (1st ed), pp 966 wrote:

“The nature and scope of the employers’ business must be clearly defined in the insurance policy, and workmen employed outside the scope of the assured’s business as described in the policy will not be covered”

In the section on Employers’ Liability Insurance in Stone & Cox’s Accident, Fire and Marine Year Book (1957), pp 688-689, the authors stressed the importance of identifying any special hazards, such as signs of careless management or lack of control or careless workmen, and observed:

“The surveying of Employers’ Liability risks has probably become more general than formerly. Apart from the question of the possibilities of accident, there is now the serious question of disability due to disease and in particular the disease known as pneumoconiosis.”

In 1974 MMI produced a Guide to Insurance Officers in Local Government, which it said that it “would like to see on the desk of every insurance officer for ready reference at any time”; this, after noting that employers’ liability was almost invariably dealt with by a separate policy and that its importance had been increased by the ELCIA, went on:

“7. Premiums are usually based on wages and salaries – this is not only a convenient yardstick but is logical since loss of earnings usually represents a substantial part of claims. Rates of premiums vary according to the nature of the work of the labour force, and the claims experience…

8. A feature of employers’ liability claims is the length of time which often elapses between the date of the accident and the final settlement, and the cost of servicing claims tends to be high. Injury caused at work during the period of insurance even though it may not be diagnosed till years afterwards can be a liability under the policy.”

I note in parenthesis that 1974 was the year in which MMI changed from a pure “sustain” form of wording to a form covering bodily injury or disease suffered, when “sustained or contracted” during the currency of the policy. Yet there is no suggestion in the Guide of any change in substance.

  1. It is in this light improbable that the present insurances can or should be read as offering cover in respect of ancient, as opposed to current, employment and

activities. But there is a third point. If insurances in the present form only address risks arising from employment during the insurance period, then, on insurers’ case, there is a potential gap in cover as regards employers’ breaches of duty towards employees in one period which only lead to injury or disease in another later period. If the employment relationship spans both insurance periods and the employer remains insured with the same insurers in both periods, there may be no problem. The employee is employed at all relevant times and the insurance may be viewed as a single continuing contract. The policy wordings set out in Annex A, with their references to insurance during the period of insurance or during any subsequent renewal period, would support the latter view. But, even in the days of more stable long-term employment and insurance relationships, employees could and would move employment or retire, or employers would cease business, or change insurers. On the basis that the insurances only cover risks arising from employment during the insurance period, there would be no cover unless the liability arose from and in the course of and involved injury or disease during the currency of the same employment and the same insurance (including any renewal).

  1. Fourthly, on insurers’ case, employers would as a result be vulnerable to any decision by insurers not to renew; and such a decision might arise from the simple performance by employers of their common law duty to disclose past negligence to insurers upon any renewal. Employers who discovered or came to appreciate that they had been negligent in the course of past activities in respects that had not yet led to any manifest disease (e.g. by exposing their employees to asbestos) would have such a duty. Insurers could then, on their own case, simply refuse any renewal or further cover. Employers could then have to disclose that refusal also to any further insurers to whom they made a proposal for cover.
  1. One response made by insurers to such problems is that they would not arise in the large bulk of cases. That is no doubt true. Most employers’ liability cases involve “short-tail” claims: typically, an accident involving injury. It is not surprising if the language of the insurances fits more easily with situations in which cause and effect coincide in time. But, by the same token, this does not mean that the underlying risk being assumed was in either party’s mind limited to circumstances in which a cause gave rise to an effect during one and the same insurance period. Rix LJ, in accepting that cover depended upon injury being sustained in the sense of experienced during the insurance period, was influenced by the thought that this was not an absurd or meaningless interpretation. The insurance could “operate entirely successfully in some 99% of cases” (para 235). In the light of this Court’s recent decision in Rainy Sky SA v Kookmin Bank [2011] UKSC 50, [2011] 1 WLR 2900, para 30, this, in my view, gives too little weight to the implications of the rival interpretations and to the principle that “where a term of a contract is open to more than one interpretation, it is generally appropriate to adopt the interpretation which is most consistent with business common sense”. The 1% of cases in which there might be no cover could not be regarded as

insignificant. Well before 1948, there was general awareness of the existence of long-tail diseases which would only develop and manifest themselves after considerable periods of years (see para 12 above; and see also Cartledge v E Jopling & Sons Ltd [1963] AC 758). The connection between asbestos exposure and mesothelioma became generally known in the mid-1960s, following the publication in 1965 of Newhouse and Thompson’s report on Mesothelioma of pleura and peritoneum following exposure to asbestos in the London area and a Sunday Times article. Yet on insurers’ case, the present insurances would not cover any situation where, after the termination of employment or the expiry of an insurance, injury or disease developed from an employer’s breach of duty to a relevant employee during an insurance period.

  1. A fifth point concerns the way in which the policies deal with the issue of extra-territorial scope. The first Excess wording stands apart from the others in its treatment of that issue. Cover only exists in respect of any employee in the employer’s service who shall sustain any personal injury by accident or disease while engaged in the service of the employer in Great Britain, Northern Ireland, the Isle of Man or Channel Islands, in work forming part of the process in the employer’s business. As soon as one postulates a delay in time between the causation and experiencing of a disease, it becomes apparent that this wording could operate to very curious effect if “sustain” looks to the latter rather than the former. A disease (e.g. a cancer) experienced during employment could be covered although caused by pre-employment exposure, while a disease caused by employment would not be covered if only experienced while working abroad. The natural inference to draw from the references to being engaged in the employer’s service and in work forming part of the employer’s business process is that it was envisaged that the accident or disease would and should arise out of such service and work, rather than merely occur during it. That points to an underlying focus on causation, even if the assumption was that in the majority of cases causation and experiencing of any injury by accident or disease would coincide.
  1. As to the other policies, at the very least, the way they deal with territorial issues throws doubt on any proposition that their wordings are so carefully or well- chosen that a court should be careful to stick literally to whatever might be perceived as their natural meaning. They address territorial scope by specific exclusions, but the cover and the exclusions use different language. Thus, although the second and third Excess wordings cover liability to employees who “sustain personal injury by accident or disease”, the territorial exclusion is in respect only of “accidents occurring” outside Great Britain, etc, leaving it unclear how disease, whether caused or developing outside Great Britain, should be dealt with. The Independent wording also covers liability to employees who “sustain bodily injury or disease”, while the territorial exclusion is for “injury, illness, loss or damage caused elsewhere” than in Great Britain, etc. While the contrast in language is capable of lending some support to a view that “sustain” looks to experiencing,

rather than to causation, an alternative possibility is that the two words were understood as having the same effect and that the cover was understood as focused on causation. The language of this exclusion thus cuts both ways, as Rix LJ recognised (para 297). A similar position applies to the contrast between injury or disease sustained and injury or disease caused outside Great Britain, etc. under the first two MMI wordings. Under the third wording, the language of the cover and the exclusion have been deliberately matched. Under the BAI wordings, however, there is an incongruity between cover for “injury sustained or disease contracted” and the exclusion in respect of “liability for accidents …. arising outside the United Kingdom”. Again, this leaves the position in respect of disease unclear, and the difference between “injury sustained” and “accidents arising” can be read either as deliberate or as suggesting that no significance was attached to the difference or that the real concern was with causation.

The history and Workmen’s Compensation Acts

  1. Much attention was, both below and before the Supreme Court, paid to the development of employees’ rights to compensation in respect of personal injury and disease, at common law and under the scheme of the Workmen’s Compensation Acts (“WCAs”). The WCAs were in force from 1897 until replaced in 1948 under the National Insurance (Industrial Injuries) Act 1946. The history and a number of the decisions under the WCAs were examined by Rix LJ in paras 126 to 165 of his judgment. He concluded that such an examination yields in the present context “not a lot”. To a considerable extent, I agree and I shall not repeat the whole exercise, but identify some potentially relevant aspects. Etymologically, some of the language presently in issue can be traced back to statutory language found in the Employers’ Liability Act 1880 and the WCA 1897. The 1880 Act modified the common law doctrine of common employment, by entitling employees to recover common law compensation for injury caused by specified matters for which employers were responsible, provided that they gave notice, within six weeks of sustaining the injury of its cause and the date at which it was sustained. The 1897 Act, applying to “personal injury by accident arising out of and in the course of employment”, also required notice to be given of the accident as soon as it occurred, stating “the cause of the injury and the date at which it was sustained”. These Acts therefore distinguished the causation and the sustaining of an injury, but not in any presently relevant context. Further, any reference to “sustaining” disappeared from the Workmen’s Compensation scheme in the 1906 Act, which amended the scheme to require a notice stating “the cause of the injury and the date at which the accident happened”.
  1. The 1906 WCA also expressly extended the scheme to cover certain diseases specified in section 8. In that context, it provided that, where a workman was certified as disabled or suspended from employment or died due to a disease “and the disease is due to the nature of any employment in which the workman

was employed at any time within the twelve months previous the date of the disablement or suspension, whether under one or more employers”, then “he or his dependants shall be entitled to compensation under this Act as if the disease or such suspension …. were a personal injury by accident arising out of and in the course of that employment …..”. Section 8(a) provided: “The disablement or suspension shall be treated as the happening of the accident”. Under section 8(c), the compensation was recoverable from the employer last employing the employee within the previous twelve months, providing the employee furnished that employer with particulars of all his other employers in the employment to the nature of which the disease was due.

  1. It was not necessary to prove that the disease actually arose from the last employment, merely to prove that the relevant employment gave rise to a risk of such a disease: Blatchford v Staddon and Founds [1927] AC 461. The 1906 Act may be regarded in this respect as involving an early statutory instance of the kind of liability recognised in Fairchild v Glenhaven Funeral Services Ltd [2002] UKHL 22, [2003] 1 AC 32 and Barker v Corus UK Ltd [2006] UKHL 20, [2006] 2

AC 572. However, failing such particulars, the last employer could excuse himself “upon proving that the disease was not contracted whilst the workman was in his employment” (section 8(c)(i)). The last employer might also join any other employer (within the last twelve months) and it was provided that upon proof “that the disease was in fact contracted whilst the workman was in the employment” of that other employer, that other employer “shall be the employer from whom the compensation is to be recoverable” (section 8(c)(ii)). Finally, section 8(c)(iii) provided that: “if the disease is of such a nature as to be contracted by a gradual process”, any other employer within the last twelve months was liable to make such contributions as might be agreed or determined by arbitration under the Act.

  1. Under this scheme, therefore, compensation for disease was initially based upon the nature of the employment and its potential for causing, rather than upon proof that it caused, such a disease. “The paternal benevolence of the Legislature” (as Visc Sumner put it in Blatchford: p 469) “is well-known, and if the price of that benevolence is paid by the last employer, who thus has to bear others’ burdens, that is nothing new in this kind of legislation”. However, the last relevant employer could seek, in specified circumstances, to avoid or to pass on to another employer responsibility by proof that the disease was not actually “contracted” in his employment. Alternatively, in the case of a disease of such a nature as to be contracted by a gradual process, all relevant employers within the last twelve months would be liable to contribute. The scheme was, as I see it, concerned with either the risk of or actual causation, and in its use of the word “contracted” it appears to me to have been directing attention to the causation, rather than the mere experiencing or manifestation, of disease.
  2. The WCA scheme was the subject of further amendment by the 1925 Act. Section 43 superseded section 8 of the 1906 Act as regards scheduled diseases, while section 47 made specific provision for the introduction of a parallel scheme covering silicosis. Effect was given to this by inter alia the Metal Grinding Industries (Silicosis) Scheme which came into force in July 1927, making provision for obtaining compensation from the last employer within the previous three years, and giving such employer rights to look to other such employers within the last five years. An insurance covering employers’ liability in this connection was considered in Smith & Son v Eagle Star (1933) 47 Ll.L.R. 88, (1934) 48 Ll.L.R. 67. Mr Hill had been employed in processes giving rise to silicosis for some 20 years. For the last two of these years, from 31 March 1928 to 16 June 1930, he worked for Smith & Son. From 30 June 1927 to 17 June 1930, Smith & Son had an insurance against WCA liability “in respect of any personal injury or disease … which at any time during the continuance of this policy shall be sustained or contracted by any workmen ….”. The policy was expressly extended to cover any liability in connection with any claim made by employees in respect of silicosis, and the decision of the Court of Appeal rested on this ground. But Scrutton LJ also examined the main policy language, and in particular what was meant by “contracted”. He noted that “there has been a good deal of discussion in the Courts about a disease which is gradually contracted commencing at some stage and through the process going on increasing the disease until at last it results in total disablement” (p 70), and concluded that the word was not to be read as “first contracted”, but “in the sense of “‘influenced’ or ‘increased’ until it ultimately comes to total disablement”. This, although not directly focusing on the first development of a disease from some earlier cause, suggests a flexible view of the word “contracted”, directed once again to the employments responsible for causing the disease.
  1. Confirmation that this was Scrutton LJ’s view can be found in the earlier case of Ellerbeck Collieries Ltd v Cornhill Insurance Co [1932] 1 KB 401. Two workmen who had been in the colliery company’s service for many years were on respectively 11 and 12 March 1929 (dates they were actually off-work) certified as suffering from miners’ nystagmus. The Cornhill had on 8 March 1929 issued the colliery company with a three month provisional cover note insuring in terms matching the wording of the insuring clause in the first Excess wording (i.e. against liability in respect of any employee who “shall sustain any personal injury by accident or disease … while engaged in the service of the employer”). Failing a satisfactory survey, the cover note actually expired on 18 March 1929. The first point decided was whether the employees had sustained personal injury by accident or disease during the period of validity of the cover note (8 to 18 March 1929). It was held that they did. The judgments in the Court of Appeal are of interest for a number of reasons. First, both Scrutton LJ (p 408) and Greer LJ (p 417) approached the question of construction on the basis that the policy was intended to protect the employers against their liability to their workmen under the WCAs. Scrutton LJ added that “it seems to me that the policy was intended to

cover the liability of the employers for the results of industrial diseases caused by the employment” (p 409). His description of the policy, covering in terms any employee sustaining personal injury by accident or disease in service, as “intended to cover … liability …. for the results of diseases caused by the employment” fits precisely with the analysis which I consider correct (paragraphs 18-28 above).

  1. Second, Scrutton LJ went on to refer to the difficulties in saying “when an industrial disease, such as miners’ nystagmus or lead poisoning, begins”, and in these circumstances the difficulty for an employee to pick the proper employer to sue. He described the way in which Parliament, by what became section 43 of the WCA 1925, had addressed such difficulties by providing “a conventional and artificial means for enabling the workman to get compensation, leaving the various employers to fight out their proportion of the liability between themselves” (p 409). He said that the last employer, liable under the WCA scheme, “then claims on the insurance company on the ground that he is liable to make compensation for an injury by disease, and the date of the injury or disablement is by statute and certificate fixed as happening between the dates for which he is provisionally covered” (p 411). On this basis, and in the light of the House of Lords decision in Blatchford, Scrutton LJ concluded that he was “bound … to hold that an accident has happened within the period of the provisional cover against the consequences of which the insurance company is bound to indemnify the employer” (p 413). In short, the “conventional and artificial” provisions of the WCA defined what constituted an accident and when personal injury by accident or disease was “sustained” for the purposes of the insurance. Greer LJ, more shortly, adopted the same approach (p 418). Only Slesser LJ (p 421) expressed a reservation about the possibility that the artificial deeming provisions of section 43(a) of the WCA 1925 might only apply as between employee and employer, and that it might have been necessary to consider separately the date of the sustaining of injury as between the employer and the insurer, had there been any admissible evidence that the two employees had actually contracted the scheduled disease before the granting of the statutory medical certificate.

Commercial purpose and practice

  1. Much general evidence was directed or elicited before Burton J in relation to the commercial purpose of the present insurances, and to practice relating to their operation in the years before the present issue arose. It was argued that there was, prior to the decision in Bolton, “a universal usage of the insurance industry to pay out mesothelioma or similar claims under [employers’ liability] policies by reference to the date of inhalation/exposure whatever the wording”, or an estoppel by convention to like effect. Burton J rejected the argument (paras 180 to 201, esp. para 201), for the reasons that, first, there was no evidence relating to years earlier than the 1980s which could be “put down to any kind of arguable usage”, second, any usage was not certain, not least because of the multiplicity of approaches to or

bases for it and, third, it was not binding. It was not incorporated into the insurance contracts. No issue of estoppel by convention was pursued to the Court of Appeal (Rix LJ, para 24, and Stanley Burnton LJ, paras 332 and 335) and the issue of a universal custom was only pursued by Zurich Insurance Company (Rix LJ, para 24).

  1. By a “multiplicity of approaches to or bases for” insurers’ practice, Burton J was referring to evidence that insurers followed the practice they did in some cases because they believed that their contracts were to be interpreted on a causation/exposure basis, in others because they believed that the aetiology of diseases such as mesothelioma was such that injury was in fact sustained (in the sense of experienced) at the date of inhalation, while yet others may have failed to realise that their historically relevant wordings had been on a different basis to the causation wordings to which they had since switched or may have failed to address their minds to any relevant issue at all in relation to an insured who was usually a longstanding repeat client.
  1. Rix LJ (para 228) contented himself with agreeing with Burton J’s reasoning on this aspect, while Stanley Burnton LJ noted and agreed in particular with Burton J’s second reason, relating to the believed aetiology of mesothelioma (para 335). Smith LJ, on the other hand, treated the “commonly held” understanding that diseases such as mesothelioma involved injury at the date of inhalation as part of the factual matrix of all the insurance contracts (paras 322- 323), and considered against that background that no difference in meaning should be held to exist between policies using sustained and causation wording, until the time when “the two sides of the insurance industry should be considered to have appreciated that some diseases, including mesothelioma, do not occur until many years after exposure to the causative agent” (para 327). She put that as around the time of the decision in Bolton, after which parties using a sustained wording must be taken to have meant only to cover injuries actually occurring during the policy period (para 327).
  1. The argument of a binding usage was not pursued before the Supreme Court, rightly so for the reasons given by the judge and the majority in the Court of Appeal. Equally, there has been no suggestion of estoppel by convention, along the lines recognised as possible in Chartbrook Ltd v Persimmon Homes Ltd [2009] UKHL 38, [2009] 1 AC 1101, para 47. However, on the issues of policy interpretation, Mr Stuart-Smith QC for Zurich Insurance, maintained before the Supreme Court an argument that there was a consensus based on market practice, whereby, for one reason or another, such policies would respond to long-tail diseases by reference to the date of exposure, and that this could constitute relevant background to their construction. Assuming that, short of a binding usage or estoppel by convention, a practice, if known to or shared by the relevant parties, could in some circumstances be relevant background (see e.g. Reardon Smith Line

Ltd v Yngvar Hansen-Tangen [1976] 1 WLR 989), still, in my opinion the argument fails in the present case. It fails in particular in the light of the judge’s findings, even in relation to policies made in and after the 1980s. A practice based on a mistaken understanding, by only some insurers, that the policies operated on a causation basis cannot be relevant background to the interpretation of every policy; on the judge’s findings other insurers do not appear to have understood that the policies operated on that basis. A practice based on a mistaken understanding by others in the market as to when long-tail diseases could be said to have been experienced or to involve injury is likewise an unpromising start for construing all policies; if the understanding were good, it would mean that such diseases fell within the policies, even though the policy cover was restricted to injury or disease experienced during the policy period. The understanding would not therefore carry any imperative to read a “sustained” wording as meaning “caused”.

  1. Before the Supreme Court, both employers and employees continued to rely upon the evidence given at trial regarding the general purpose of employers’ liability insurance as part of the background to the interpretation of the present insurances. Rix LJ (paras 223 to 235) gave it some weight as such, but Stanley Burnton LJ thought that there was “little if any assistance to be gained by reference to the commercial purpose of EL insurance”, as this was simply “to provide the cover defined in the policy” (para 333). The Supreme Court was provided with a useful summary of the considerable volume of evidence relied upon in this connection. It consisted in general of answers given by insurers, two at least of them with experience going back to the 1940s. They were asked (frequently in response to leading – though not inadmissible on that score – questions in cross- examination) about their or others’ views, understandings or perceptions as to the purpose of the policies, and the way in which these would or should respond, in relation to injuries arising from exposure in the course of activities during the policy period. In my judgment, Stanley Burnton LJ was right to reject such evidence as inadmissible. The parties cannot be asked what they meant by their contract, and, failing any binding usage, it is equally inadmissible to ask other persons operating in the market to give general evidence as to what they would have understood the parties to have meant by the words used in the context in which they were used. The evidence does not seem to have amounted to more than that.
  1. However, I do not agree with Stanley Burnton LJ’s suggestion that no useful conclusions can be drawn about the commercial purpose of the policies, save that it was to provide the defined cover. In my opinion, relevant conclusions about the general nature and purpose of the individual policies can be drawn in this case, just as they could in the case of the different (and wordier) instrument in issue in In re Sigma Finance Corporation [2009] UKSC 2, [2012] 1 All ER 571 (see especially paras 10, 12 and 37). They can be drawn from an overall consideration of the individual insurance wordings, and particularly from the

features which tie cover to the employees and activities during the relevant policy period and the five points considered in paragraphs 18 to 28 above. Further, if the policies are on any view apt to cover employers’ liability for long-tail diseases which initiate during, but only manifest themselves years after, the original policy period, one may look with scepticism at an interpretation which distinguishes this situation from other situations where a long-tail disease is caused but does not strictly begin during the policy period, and only manifests itself years later. This is particularly so if a conclusion that the latter diseases fell outside the policy cover meant that they would or might well not fall within any subsequent employers’ liability policy.

ELCIA 1969

  1. Section 1 of the ELCIA provides:

“1.-  (1)  Except  as  otherwise  provided  by  this  Act, every employer carrying on any business in Great Britain shall insure, and maintain insurance, under one or more approved policies with an authorised insurer or insurers against liability for bodily injury or disease sustained by his employees, and arising out of and in the course of their employment in Great Britain in that business, but except in so far as regulations otherwise provide not including injury or disease suffered or contracted outside Great Britain…

(3) For the purposes of this Act –

(a) ‘approved policy’ means a policy of insurance not subject to any conditions or exceptions prohibited for those purposes by regulations….”

4.- (1) Provision may be made by regulations for securing that certificates of insurance in such form and containing such particulars as may be prescribed by the regulations, are issued by insurers to employers entering into contracts of insurance in accordance with the requirements of this Act ….

(2) ….. the employer … shall during the currency of the insurance and such further period (if any) as may be provided by regulations-

(a) comply with any regulations requiring him to display copies of the certificate of insurance for the information of his employees; ….”

The only conditions or exceptions ever prohibited were certain exemptions from liability. Under section 3, the ELCIA did not however apply to local authority employers, such as most of MMI’s insureds. Under section 4, provision might be made for certificates of insurance to be issued to employers, and in that event the employer was, obliged “during the currency of the insurance and such further period (if any) as may be provided by regulations” to “comply with any regulations requiring him to display copies of the certificate of insurance for the information of his employees”.

  1. In reaching his conclusions on the ELCIA (para 16 above), Rix LJ engaged in an impressive analysis, to which I would refer (paras 166 to 186). The only doubt this leaves is how, if the ELCIA requires a causation wording, an employer could properly insure on a wording which only covered injury sustained in the sense of experienced (see para 186 and paragraph 16 above). The scope of the ELCIA is, as Rix LJ indicated, open to three alternative analyses: that it requires cover in respect of (i) all future liability incurred during the insurance period, whenever the negligence or injury, or (ii) liability for all future injury or disease sustained (in the sense of experienced) by employees during the insurance period, whenever the negligence, or (iii) liability for all negligence or breach of statutory duty during the insurance period giving rise to liability as in (ii). The retrospectivity of cover involved in (i) and (ii) is unlikely to have been intended. The only one of the three possibilities not involving a degree of retrospectivity is (iii).
  1. A duty on every employer to “insure, and maintain, insurance” is consistent with a requirement to have the insurance in place during, though to maintain it after, the relevant insurance period. The provision, contemplated by section 4, for copies of insurance certificates to be issued by insurers and to be displayed by any employer for the information of his employees “during the currency of the insurance and such further period as may be provided by regulations” indicates, first, a desire to assure employees of their insurance protection during the relevant insurance period, and, secondly, an awareness that this assurance might need to remain in place after such insurance period; it is therefore suggestive of (iii), rather than (i) or (ii). As Rix LJ observed, it is only cover in accordance with (iii) that can give an employee the assurance that any injury or disease suffered as an employee and “arising out of and in the course of [his] employment” will be covered by insurance, the benefit of which would, if necessary, be available to him at the time under the Third Party (Rights against Insurers) Act 1930. An obligation to have a policy in force only at or by the time when injury is actually experienced would leave employees or ex-employees at the mercy of compliance with the statute by their employers or ex-employers at uncertain future dates.
  2. It would also leave such employees or ex-employees at the mercy of employers who, for whatever reason, ceased to carry on business either in Great Britain or (for example due to insolvency) at all. Further, if “injury or disease suffered or contracted” bears the same meaning as insurers suggest that “injury or disease sustained or contracted” bears, then an employee, who had the misfortune to succumb to a disease abroad caused by his employment or previous employment in Great Britain, would not be covered (unless regulations intervened to ensure that he was).
  1. Stanley Burnton LJ thought that any issue as to the nature of the insurance required under ELCIA was resolved by its use of the word “sustained”, rather than “caused”. He went on to conclude that the ELCIA covered any injury sustained (in the sense of experienced) during a period of insurance, by anyone who was then or had at any previous time been an employee. However, that latter conclusion introduces a retrospectivity into the scope of the ELCIA, which, as already indicated, I think unlikely to have been intended. The statute could have used the tariff wording of causation instead of “sustained”. But in the statutory language the word “sustained” is not coupled with a phrase such as “during the period of the insurance”. Even if “sustained” means “experienced” in the context of the statute, the statute may require insurance on what is effectively a causation basis; the words “sustained by his employees” may well mean “sustained at any future time by his current employees”. The key to the meaning of the statutory language seems to me the combination of the phrases “arising out of and in the course of their employment in Great Britain” and “not including injury or disease suffered or contracted outside Great Britain”. Together, and for reasons given in the last two paragraphs, they indicate a statutory requirement to insure in respect of activities during the course of employment in Great Britain which may in the future give rise in or out of Great Britain to liability to the employees involved in such activities.
  1. In my judgment, therefore, the conclusion which gives proper effect to the protective purpose of the legislation is that the ELCIA requires insurance on a causation basis. The ELCIA extension provision to the Independent and second BAI wordings (see Annex A), as well as a similar extension provision to the MMI policy intended for insureds who were not local authorities, achieved this result expressly in relation to policies written subsequent to the coming into force of the ELCIA, at least for the purpose of ensuring that employees’ claims were covered by insurance. Any other subsequent insurances not containing that extension provision should, if possible, be read as providing the relevant employers’ cover required by statute. This is a powerful tool in the interpretation of such insurances.

Bolton M.B.C. v Municipal Mutual Insurance Ltd

  1. The Court of Appeal in the present case was bound by its previous decision in Bolton MBC v Municipal Mutual Insurance Ltd [2006] EWCA Civ 50, [2006] 1 WLR 1492 on public liability policies. The majority regarded that case as, in effect, determining the meaning which must be put on the word “sustained” in the present employers’ liability policies: see paras 284, per Rix LJ, and 339, per Stanley Burnton LJ, who however also found the logic of Longmore LJ’s judgment convincing in relation to the latter type of policies. Smith LJ on the other hand considered that public liability and employers’ liability insurances gave rise to different considerations (para 328). In my opinion, that is right. Employers’ liability policies are subject to particular terms and considerations, analysed above (particularly in paragraphs 18-28 and, in the case of policies effected after the coming into effect of the ELCIA, paragraphs 41-46). These considerations are not or certainly not necessarily applicable to public liability insurances. The present case was concerned with employers’ liability not public liability insurances, and it may well be that not all the relevant facts relating to the latter are before us. We certainly have not heard full argument on the proper conclusions which may be drawn regarding the basis of liability or trigger generally applicable under the latter. In these circumstances, I would proceed on the basis that we are not bound by Bolton, that this does not involve any view about the correctness or otherwise of Bolton, but only that it is unnecessary to consider what the position generally may be under public liability policies. Assuming that, in relation to public liability insurance, the position generally is as stated in Bolton, that does not alter the conclusions which I reach. It merely means, in their light, that public liability insurance generally and the present employers’ liability policies operate on different bases, because of their different backgrounds, terms and purposes.

Contracted

  1. There is no difficulty about treating the word “contracted” as looking to the causation or initiation of a disease, rather than to its development or manifestation. In relation to the two BAI wordings and the third MMI wording, this interpretation obtains strong support from the general nature and purpose of the relevant policies, derived from their immediate context and terms and analysed in paragraphs 18 to 28 and 41 above. To the limited extent that the WCA background may assist to inform the meaning of later policies, it can be seen overall as a legislative scheme which was concerned with either the risk of or actual causation (para 32 above). Even if, in the phrase “sustained or contracted” or “injury sustained or disease contracted”, the word “sustained” is to be understood as meaning “experienced”, that would reflect no more than the fact that the cause and effect of an injury commonly coincide; I would still unhesitatingly conclude, as did the Court of Appeal, that the word “contracted” used in conjunction with disease looks to the initiating or causative factor of the disease.

Sustained

  1. The majority of the Court of Appeal considered that it was impossible to view policies with pure “sustained” wordings as operating by reference to the initiating or causative factor of a disease. They did so primarily by reference to the wording of the insuring clauses. In my view, as indicated in paragraphs 18-19 above, a broader approach is necessary. The general nature and purpose of these policies can be derived from their immediate context and terms, analysed in paragraphs 18 to 28 and 41 above. It is true, as Rix LJ said, that phrases such as “injury sustained” by an employee or an employee who “shall sustain injury”, in either case by accident or disease, appear to address the impact of the accident or disease on the employee. But the underlying focus of the insurance cover is on the employees and activities current during the insurance period. The cover would be potentially incomplete, and employers would be potentially exposed to uninsured risks, were “sustained” to be understood as meaning “developed” or “manifested”. This is so, even before the ELCIA came into force. Any policies written subsequent to the coming into force of the ELCIA either afford cover consistent with the Act’s requirements by virtue of an ELCIA extension provision, or, to the extent that this is not the case, should be construed, if at all possible, as meeting employers’ obligations under that Act. In my view, such obligations included taking out insurance in respect of negligence during the insurance period affecting an employee in a manner giving rise to bodily injury or disease then or at any subsequent time. On this basis, I consider that, although the word “sustained” may initially appear to refer to the development or manifestation of such an injury or disease as it impacts employees, the only approach, consistent with the nature and underlying purpose of these insurances both before and after the ELCIA, is one which looks to the initiation or causation of the accident or disease which injured the employee. The disease may properly be said to have been “sustained” by an employee in the period when it was caused or initiated, even though it only developed or manifested itself subsequently.

Disease sustained, read as meaning experienced or incurred

  1. Rix LJ was attracted by the submission that, even if sustaining disease meant experiencing or incurring it during the period of the insurance, long-tail diseases could be said to have been sustained during the period of insurance in this sense. He asked rhetorically whether an employee who had inhaled asbestos had not “sustained an injury in the form of an assault of the fibres”, as a result of which he was worse off through having dangerous fibres in his lungs (para 280). He noted that, although there was at most trivial injury or damage, and nothing that could create actionable damage, nevertheless, when mesothelioma develops, “it is the risk of mesothelioma created by the exposure which is the damage (see …. Barker …)” and “it is the exposure, and the risk of mesothelioma, that is the

damage” (para 281). He only felt bound to reject this analysis (para 284) because of the Court of Appeal’s previous decision in Bolton.

  1. It may be that in the case of some long-tail diseases, the victim can be said to have incurred or caught them at the same time as the initial ingestion or scratch giving rise to them. But it is clear that this is not the position with inhalation of asbestos in relation to either asbestosis or mesothelioma. No cause of action arises from exposure or inhalation alone: Rothwell v Chemical & Insulating Co Ltd [2007] UKHL 39, [2008] 1 AC 281. Further, for reasons which I develop in paragraphs 64-65 below, the exposure and risk are not by themselves damage in any sense known to the law. Damage is only incurred when mesothelioma develops. Only when it develops does the victim incur damage which is legally relevant, and even then this is not because any physical link necessarily exists or can be proved between the mesothelioma and the original exposure. The rule in Fairchild and Barker imposes liability for the mesothelioma upon persons who have exposed the victim to asbestos, and so created a risk of mesothelioma. But it is not a rule which, even as between employers and employees, deems the latter to have suffered injury or disease at the time of any exposure. And, even if it were viewed simply as a rule imposing retrospective liability on employers for exposing their employees to the risk of mesothelioma, the insurance policies do not insure risks of physical injury or disease, but only actual injury or disease.

The application of the insurances in respect of mesothelioma

  1. At the outset of these appeals, the application of the insurances in respect of mesothelioma suffered by employees exposed to asbestos during their employment by an insured employer did not appear controversial. This changed after a question from Lord Phillips on day 4 of the hearing, followed by a later written note. All the same, the transcript pages containing any argument on the point numbered only 40 out of a total of some 1140. So far as Mr Edelman made any submissions on this point, in his written case or orally, they were to this effect: if the correct analysis of the House’s decision in Fairchild be that an employer who exposes an employee to asbestos is deemed to have caused that employee’s mesothelioma, then employers’ liability insurances held by the employer on a “causation” basis should respond; but, if the policies do not respond on a causation basis, there is no justification for treating the employee as having suffered injury or a disease during their currency, because employers cannot prove that any particular inhalation caused any injury. This led to some discussion, particularly with counsel for employers and employees, of the points which I have already addressed in paragraphs 50-52 above.
  1. The point now expressed forcefully by Lord Phillips in his judgment is that exposure to the risk of mesothelioma is the correct analysis of the Fairchild

principle, at least as subsequently interpreted, and that such exposure can satisfy neither the concept of injury nor the concept of causation for the purposes of the policies. If that is right, then the present insurance claims must all fail. Indeed, the great bulk of insurance claims settled by other insurers (e.g. former tariff insurers) or by the present insurers under the causation policies they have issued in more recent years (paragraph 10 above) should presumably also have failed. The only exception may be the case of an employee exposed to asbestos in only one employment by an employer holding insurance throughout with only one insurer. In such a case it might (perhaps) be said that, whichever particular inhalation(s) may have been responsible for the employee’s mesothelioma, it (or they) must have been insured. Even then, the logic of the Supreme Court’s reasoning in Fairchild and Sienkiewicz v Greif (UK) Ltd [2011] UKSC 10, [2011] 2 AC 229 might lead to the conclusion that causation was still unprovable in the light of the possibilities of environmental or idiopathic causation of mesothelioma.

  1. Rules regarding causation are created by the courts for the purpose of determining when liability arises in particular contexts. Normally, they reflect a common sense understanding of what is ordinarily understood when we speak of a cause in a particular context. In their leading work on Causation in the law (Clarendon Press, 2nd ed 1985) Professor H. L. A. Hart and Tony Honoré examined both this understanding and its relationship to legal decision-making. Generally, but not always, a cause must involve an act or omission that was at least a sine qua non of the injury in respect of which responsibility attaches (the “but for” test). But sometimes two separate acts or omissions may each independently have been sufficient to give rise to that injury (as when A and B simultaneously, but independently shoot C dead), and then we may as “a matter of legal policy” accept “a weaker causal relationship” for the imposition of responsibility: see p lxv in the preface to and p 123 of the 2nd edition.
  1. Other cases where causal requirements have been relaxed include Bonnington Castings Ltd v Wardlaw [1956] AC 613; there, materially contributing to part of an accumulation of dust which cumulatively led to pneumoconiosis gave rise to liability for the whole disease (although it has been suggested that some apportionment might now be possible in fact and law). Another relevant authority is McGhee v National Coal Board [1973] 1 WLR 1; there, liability for dermatitis was held to exist because the defendant had materially contributed to part of the claimant’s exposure to dirt, any part of which might, independently of any other, have given rise to the abrasion leading to the claimant’s dermatitis. It was recognised that this involved liability based on materially contributing to the risk of the injury. Lord Reid at p.4G-H described the result as reached “taking a broader view of causation”, and Lord Wilberforce at p 5G viewed it as involving a conclusion as to the “causal connection” that had to exist “between the default and the disease complained of”. The contrary view (viz, that proof of risk was insufficient without proof that the risk caused or materially contributed to the

disease) had a “logic” which Lord Wilberforce acknowledged, but rejected for policy and evidential reasons set out at p.6C-F. In Fairchild, McGhee was seen as a precursor of the decision there reached. Putting aside the possibility of an idiopathic or environmental cause, a Fairchild type situation exists when (a) there are two separate potential causes exposing the claimant to the same risk, one involving an act or omission by the defendant, (b) either one of which causes would have been sufficient to give rise to the injury, and (c) one of which did so, but (d) neither of which can as a matter of probability be shown to have done so.

  1. Taking into account the later decisions in Barker v Corus and Sienkiewicz, the Fairchild principle extends to any case where there has been an act or omission exposing a person to asbestos, which exposure may have caused the mesothelioma, but which cannot be shown as a matter of probability to have done so. On that basis, the House held in Barker v Corus that each or any person’s liability should only be proportionate to the extent that he had exposed another to the risk of mesothelioma. Parliament by the Compensation Act 2006 reversed that conclusion and made each such person liable in respect of the whole of the damage caused by the mesothelioma.
  1. Lord Phillips in his judgment addresses the basis of Fairchild in the light of Barker v Corus, the 2006 Act and Sienkiewicz. He accepts that, if Fairchild is now correctly to be understood as a special rule deeming employers who have exposed an employee to asbestos to have caused any subsequently suffered mesothelioma, then the insurance policies should apply (para 109). But he concludes that Fairchild must be understood as creating liability not for the disease, but “for the creation of the risk of causing the disease”. It follows in his view that employers and employees gain no assistance from the special rule in asserting that mesothelioma suffered by any person was caused or initiated in any particular policy period. On this basis, even though the insurances respond to injuries caused or initiated during their periods, the employers and employees fail for want of proof.
  1. It is not fruitful to repeat the exercise undertaken in Barker v Corus of examining in detail the significance of the speeches in Fairchild. The House was not agreed about this in Barker, but the majority speeches of Lords Hoffmann, Scott and Walker were at pains to reject any analysis of Fairchild as proceeding upon a fiction that each exposure had caused or materially contributed to the disease: see paras 31, 61 and 104; they each also referred to the liability created by Fairchild as being not for causing the disease, but for materially increasing the risk of the mesothelioma which was in fact suffered: paras 31, 36 and 40, 53, 61 and

113. Lord Rodger (dissenting) perceived the majority to be misinterpreting Fairchild by failing to acknowledge that it was based on an equation of materially increasing risk with materially contributing to causation, an equation which he thought had been accepted as sufficient causation in Bonnington Castings Ltd v

Wardlaw [1956] AC 613 and McGhee v National Coal Board [1973] 1 WLR 1. It is on the apparently bright-line distinction said to have been drawn by the majority in Barker between materially contributing to increasing the risk of, and causing, a disease that Lord Phillips now founds his judgment in these appeals.

  1. The Compensation Act 2006 applies where a person who has exposed someone to asbestos is liable in tort in connection with damage caused to the latter by mesothelioma “whether by reason of having materially increased a risk or for any other reason” (section 3(1)(d)). It makes the former person “liable in respect of the whole of the damage” (section 3(2)(a)). On its face, the Act assumes rather than creates the liability, and only alters the measure of recovery. That was the view expressed in Sienkiewicz by Lords Phillips, Rodger and Brown (paras 70, 131 and 183).
  1. However, on further analysis, the distinction identified in paragraphs 58-59 above proves more elusive. Even in Barker itself, Lord Walker described exposing the employee to the risk of mesothelioma as being “equated with causing his injury” and the result as “an explicit variation of the ordinary requirement as to causation” (para 104), and spoke of the rule as one “by which exposure to the risk of injury is equated with legal responsibility for that injury” (para 109). However, it is conceivable that he meant that the ordinary requirement of causation of the disease was entirely replaced by another liability-creating rule. It is in the later authority of Sienkiewicz that the difficulty of drawing any clear-cut distinction between creating a risk and causation of the disease becomes most apparent. Lord Phillips there stated that “the rule in its current form” was that the person responsible for the exposure “and thus creating a ‘material increase in risk’ of the victim contracting the disease will be held to be jointly and severally liable for causing the disease” (para 1). Later, he said that the law was presently contained in Fairchild and Barker which had “developed the common law by equating ‘materially increasing the risk’ with ‘contributing to the cause’ in specified and limited circumstances” (para 70). That was the analysis of Fairchild advanced by Lord Rodger in Barker v Corus (paras 73 and 83) but rejected there by the majority. Lord Brown in Sienkiewicz spoke of a “more relaxed approach to causation” (para 178) and flexibility in the approach to causation (para 187). I referred to Fairchild and Barker as involving a “special rule of causation” (para 188), and Lord Kerr referred to them as involving a “modification of the previously applicable legal rules in relation to the causation element in employers’ liability claims” (para 196) and to adjustments in the burden of proof (paras 198 and 200). Lord Rodger was, on the other hand, loyal to the majority view in Barker by referring to liability as based on “materially increas[ing] the risk” (para 113), and Lord Dyson was cautious in speaking of materially increasing the risk of contracting the disease as “sufficient to satisfy the causal requirements for liability” (para 207).
  2. Lord Phillips has in para 123 set out a passage from an extra-judicial commentary written by Lord Hoffmann in Perspectives on Causation (2011), p 8. In it, Lord Hoffmann describes the two ways in which the changes introduced by Fairchild and Barker could be characterised, one as changing “the causal requirements for an action for damages for mesothelioma …; all that is necessary is to prove that the risk has been increased and that the specific exposure may have provided the actual agent”; the other as “creat[ing], exceptionally, a cause of action for the increased risk of mesothelioma, rather than for the disease itself”. Lord Hoffmann notes that the House in Barker (Lord Rodger dissenting) adopted the second explanation of what had happened in Fairchild. But in the next sentence, not quoted by Lord Phillips, Lord Hoffmann went on:

“Parliament almost immediately reversed this decision by a statute giving effect to the first explanation, which had been advocated by Lord Rodger in his dissenting speech”.

Lord Hoffmann’s extra-judicial (or judicial) words cannot by themselves alter the true effect of a statute, but his comments do again show that the suggested distinction is more fluid than might at first appear.

  1. It is relevant to look more closely at what Barker decides. In Barker, Lord Hoffmann spoke of Fairchild as applying “an exceptional and less demanding test for the necessary causal link between the defendant’s conduct and the damage” (para 1) and of “the requirement of a sufficient causal link between the defendant’s conduct and the claimant’s injury” (para 17). In his note in Perspectives on Causation, he picked up this language with references to the “causal requirements” of the relevant rule and to the issues in cases of mesothelioma and analogous situations as involving the “causal requirements for an action for damages for mesothelioma”. Lady Hale in Barker also viewed the common law rules governing the measure of recovery as “closely linked to the common law’s approach to causation”, and said that there was “no reason in principle why the former rules should not be modified as the latter approach is courageously developed to meet new situations” (para 122). In paras 123 and 124, she made clear that in her view the issue in Barker could be seen as arising from the expanded perceptions or developed concept of causation which the law had accepted.
  1. These citations all suggest that it is both possible and appropriate to characterise the position achieved by the common law after Barker v Corus as one concerned with the issue of the “causal requirements” or “causal link”, as between the defendant’s conduct and the disease, which the common law requires in order for there to be an action “for mesothelioma”. But analysis of the rule arrived at after Fairchild and Barker justifies further propositions. Despite the apparent clarity of the suggested distinction between liability for a risk and for a disease, no

cause of action at all exists unless and until mesothelioma actually develops. Neither the exposure to asbestos nor the risk that this may one day lead to mesothelioma or some other disease is by itself an injury giving rise to any cause of action: see Rothwell v Chemical & Insulating Co Ltd [2007] UKHL 39, [2008] 1 AC 281; the House there decided that not even the emergence of pleural plaques “marking” the past exposure to asbestos constituted injury for the purpose of giving a cause of action. In order to fall within the principle in Fairchild and Barker, the development of mesothelioma is a pre-condition: see Barker, per Lord Hoffmann (para 48) and Lord Scott (para 53). Lady Hale went further, stressing that she in fact agreed with Lord Rodger’s view that “the damage which is the ‘gist’ of these actions is the mesothelioma and its physical and financial consequences. It is not the risk of contracting mesothelioma” (para 120).

  1. In reality, it is impossible, or at least inaccurate, to speak of the cause of action recognised in Fairchild and Barker as being simply “for the risk created by exposing” someone to asbestos. If it were simply for that risk, then the risk would be the injury; damages would be recoverable for every exposure, without proof by the claimant of any (other) injury at all. That is emphatically not the law: see Rothwell and the statements in Barker itself, cited above. The cause of action exists because the defendant has previously exposed the victim to asbestos, because that exposure may have led to the mesothelioma, not because it did, and because mesothelioma has been suffered by the victim. As to the exposure, all that can be said (leaving aside the remote possibility that mesothelioma may develop idiopathically) is that some exposure to asbestos by someone, something or some event led to the mesothelioma. In the present state of scientific knowledge and understanding, there is nothing that enables one to know or suggest that the risk to which the defendant exposed the victim actually materialised. What materialised was at most a risk of the same kind to which someone, who may or may not have been the defendant, or something or some event had exposed the victim. The actual development of mesothelioma is an essential element of the cause of action. In ordinary language, the cause of action is “for” or “in respect of” the mesothelioma, and in ordinary language a defendant who exposes a victim of mesothelioma to asbestos is, under the rule in Fairchild and Barker, held responsible “for” and “in respect of” both that exposure and the mesothelioma.
  1. This legal responsibility may be described in various ways. For reasons already indicated, it is over-simple to describe it as being for the risk. Another way is to view a defendant responsible under the rule as an “insurer”, but that too is hardly a natural description of a liability which is firmly based on traditional conceptions of tort liability as rooted in fault. A third way is to view it as responsibility for the mesothelioma, based on a “weak” or “broad” view of the “causal requirements” or “causal link” appropriate in the particular context to ground liability for the mesothelioma. This third way is entirely natural. It was adopted by Lords Reid and Wilberforce in McGhee, by Lord Hoffmann, Lady Hale

and (possibly) Lord Walker in Barker and by Lord Hoffmann in his extra-judicial commentary. It seems to have received the perhaps instinctive endorsement of a number of members of this Court, including myself, in Sienkiewicz. Ultimately, there is no magic about concepts such as causation or causal requirements, wherever they appear. They have the meanings assigned to them and understood in ordinary usage in their context. A logician might disagree with a reference to causation or a causal link in a particular context, but that is not the test of meaning: see Lord Wilberforce’s words in McGhee, p 6C-F (cited in para 56 above). The present appeals concern the meanings we assign to the concept of causation, first in the context of considering employers’ liability to their employees and then in considering the scope of employers’ insurance cover with respect to such liability.

  1. It is instructive in this connection to look more closely at the Compensation Act 2006. Section 3(3) states that section 3(2) “does not prevent (a) one responsible person from claiming a contribution from another, or (b) a finding of contributory negligence”. Section 3(4) goes on to provide that “[I]n determining the extent of contributions of different responsible persons in accordance with subsection (3)(a), a court shall have regard to the relative lengths of the periods of exposure for which each was responsible …”. Section 3(3) necessarily relates to the legal bases for claiming contribution or asserting contributory negligence, which are to be found in, respectively, the Civil Liability (Contribution) Act 1978 and the Law Reform (Contributory Negligence) Act 1945. The 1978 Act addresses the situation where two or more persons are “liable in respect of the same damage” (section 1(1)), while section 2(1) provides for contribution in such situations to be “such as may be found by the court to be just and equitable having regard to the extent of that person’s responsibility for the damage in question”. Although under section 3(4) of the 2006 Act, the court must have regard to the relative lengths of the exposure for which each was responsible, the “same damage” which is a pre- condition to the application of the 1978 Act must be the mesothelioma. It cannot be the risk created by the person by or from whom contribution is sought, because each person and exposure creates a separate risk, and no one person or exposure creates the total risk resulting from all exposures. The 2006 Act, by its reference to the 1978 Act, thus assumes that every person, who has exposed to asbestos a victim who later experiences mesothelioma, incurs “responsibility for” the mesothelioma. That language again fits an analysis whereby the rule in Fairchild and Barker identifies the appropriate “weak” or “broad” causal link between the exposure and the mesothelioma.
  1. A similar position applies under the 1945 Act. Under section 1(1), that Act applies “[w]here any person suffers damage as the result partly of his own fault and partly of the fault of any other person or persons”. In that event, the damages recoverable are to be reduced “to such extent as the court thinks just and equitable having regard to the claimant’s share in the responsibility for the damage”. The application of this section, as contemplated by the 2006 Act, is only possible on

the basis that a mesothelioma sufferer may be said to have suffered the mesothelioma partly “as the result …. of the fault” of anyone who has exposed him to asbestos. In other words, the rule in Fairchild and Barker must have been viewed by the drafters – in my opinion entirely understandably – as establishing a causal link, between the exposure and the mesothelioma, sufficient for it to be said that the mesothelioma was “the result” of each (and every) exposure. A similar view is also implicit in the provisions of the Act drafted on the basis that insurers – who would commonly of course be employers’ liability insurers – would be among the persons by or for whose benefit or against whom contribution would be sought in cases of multiple responsible persons: see section 3(7)(b) and (10)(a) of the 2006 Act. Those provisions necessarily assume that employers’ liability insurances, written generally on a causation basis, would respond to Fairchild/Barker type liability incurred by employers.

  1. Ultimately, the present appeals raise the questions how the present employers’ liability insurance policies respond as a matter of construction in circumstances within the rule in Fairchild and Barker. Where two contracts are linked, the law will try to read them consistently with each other. This is so with language in a bill of lading, incorporated from a charterparty: The Njegos [1936] P

90. A similar approach applies to language in a reinsurance incorporated from the insurance: Forsikringsaktieselskapet Vesta v Butcher [1989] AC 852 and Groupama Navigation et Transports v Catatumbo CA Seguros [2000] 2 Lloyd’s Reports 350, even though there is no guarantee that a reinsurance will in every possible circumstance that may develop pick up every liability that may be held to exist under an insurance: see Wasa International Insurance Co Ltd v Lexington Insurance Co [2009] UKHC 40, [2010] 1 AC 180. The intention under the present insurances must be taken to have been that they would respond to whatever liability the insured employers might be held to incur within the scope of the risks insured and within the period in respect of which they were insured. Thus, as Scrutton and Greer LJJ accepted in the Ellerbeck Collieries case (paragraph 34 above), an employers’ liability insurance could have been expected to respond to the “conventional and artificial” definition in the WCAs as to what constituted an “accident” and when personal injury by accident or disease was “sustained” for the purposes of employers’ liability to employees.

  1. Furthermore, if the common law during or even after the currency of an insurance develops in a manner which increases employers’ liability, compared with previous perceptions as to what the common law was, that is a risk which the insurers must accept, within the limits of the relevant insurance and insurance period. Eady J correctly identified this in Phillips v Syndicate 992 Gunner [2003] EWHC 1084 (QB), [2004] Lloyd’s Insurance and Reinsurance Reports 426, 429 (left). The declaratory theory “does not presume the existence of an ideal system of the common law, which the judges from time to time reveal in their decisions. … But it does mean that, when judges state what the law is, their decisions do ….

have a retrospective effect” – in the sense that the law as stated “will, generally speaking, be applicable not only to the case coming before [them] but, as part of the common law, to other comparable cases which come before the courts, whenever the events which are the subject of those cases”: Kleinwort Benson Ltd v Lincoln CC [1999] 2 AC 349, 378G-H, per Lord Goff. The declaratory theory is a pragmatic tool, essential when cases can only come before the court “some time, perhaps some years” after the relevant events occurred, and when “the law [must] be applied equally to all, and yet be capable of organic change” (p 379A). A similar principle must, generally speaking, apply in relation to a statute such as the Compensation Act 2006, which changes or corrects the common law to what Parliament perceives to be a more appropriate result for the purposes of all future cases coming before the courts, whenever the events giving rise to them. In the case of that Act, the result was one which the courts might as a matter of common law well have themselves accepted (and which indeed Lord Rodger in his powerful dissent in Barker v Corus believed that the common law had accepted) in Fairchild.

  1. Concluding, as I have done, that the present insurances covered employers’ liability for injuries or diseases “caused” during the relevant insurance periods, the question is whether they cover employers’ liability for mesothelioma arising under the rule in Fairchild and Barker from having exposed employees to asbestos during such periods. It is not in dispute that, if the rule is characterised as a rule of “deemed” causation, then the policies must respond. A parallel example, so familiar that it is easy to overlook, is the vicarious liability to an employee, A, which rests on any employer, B, who has not himself been negligent but must answer vicariously for the negligence of another employee, C. We have no hesitation in saying that the employer B has in such a case “caused” the injury or disease suffered by A. But this is so in reality only because a rule of law requires us to equate the acts or omissions of C with those of B.
  1. The argument, accepted by Lord Phillips, is that the rule in Fairchild and Barker is not one of deemed causation of or, therefore, liability for the disease, but one of liability for the risk created by the exposure. For reasons which I have set out, I regard this distinction as too simple. The liability arises only because of the incurring of the disease and is for the disease. A condition of such liability is that the employer (negligently) exposed the victim to asbestos. The insurance policies, read as operating on a causation basis, are aimed at covering liability generated by employers’ activities during their insurance periods: see paragraphs 18-28 and 41 above; unless liability for mesothelioma flowing from negligent exposure during an insurance period is covered by the policies, this aspect of employers’ activities will not in practice be covered at all.
  1. In my view, these considerations justify a conclusion that, for the purposes of the insurances, liability for mesothelioma following upon exposure to asbestos

created during an insurance period involves a sufficient “weak” or “broad” causal link for the disease to be regarded as “caused” within the insurance period. It would, I think, have been anomalous and unjust if the law by “deeming” there to have been causation of the disease could have created policy liability (which is common ground), but the law by insisting that the liability in respect of mesothelioma was for the risk of causation achieved a quite different result. As I have sought to show, it is not in any event accurate to treat the liability as being either solely or strictly for the risk. The risk is no more than an element or condition necessary to establish liability for the mesothelioma. The reality, reinforced by provisions in the 2006 Act, is that the employer is being held responsible for the mesothelioma.

  1. For this purpose, the law accepts a weak or broad causal link. The link is to exposure which may but cannot be shown on the ordinary balance of probabilities to have played a role in the actual occurrence of the disease. But for the purposes of the policies the negligent exposure of an employee to asbestos can properly be described as having a sufficient causal link or being sufficiently causally connected with subsequently arising mesothelioma for the policies to respond. The concept of a disease being “caused” during the policy period must be interpreted sufficiently flexibly to embrace the role assigned to exposure by the rule in Fairchild and Barker. Viewing the point slightly more broadly, if (as I have concluded) the fundamental focus of the policies is on the employment relationship and activities during the insurance period and on liability arising out of and in course of them, then the liability for mesothelioma imposed by the rule in my opinion fulfils precisely the conditions under which these policies should and do respond.

Conclusion

  1. I would therefore dismiss the appeals by insurers so far as they concern the policies with “contracted” wordings. I would allow the appeals against insurers, and dismiss the appeal by the Independent, so far as they concern policies with “sustained” wordings.

ANNEX A

The policy wordings (dates are approximate)

  1.  Excess

First Wording (late 1940s):

Whereas …. . (hereinafter called “The Employer”) carrying on the business of ….

has made a proposal ….

this Policy witnesseth that in consideration of the payment of …. as premium to the Company on the estimated total amount, as set forth in the Schedule hereto, of the wages, salaries, and other earnings of Employees, a description of whom is set forth in the said Schedule (which premium is subject to adjustment as hereinafter provided) the Company agrees to indemnify the Employer in the manner following, namely –

That if at any time during the period commencing on the…day of…19 , and ending on the…day of…19 (both days inclusive) and for such further period or periods as may be mutually agreed upon, any employee in the Employer’s immediate service shall sustain any personal injury by accident or disease while engaged in the service of the Employer in Great Britain, Northern Ireland, the Isle of Man or the Channel Islands, in work forming part of or process in the business above mentioned, and in case the Employer shall be liable to damages for such injury, either under or by virtue of the Common Law, the Fatal Accidents Acts 1846 to 1908, or the Law Reform (Miscellaneous Provisions) Act 1934, the Company will indemnify the Employer…

The Schedule required a description of the insured company’s employees and their estimated total wages, salary and other earnings.

Condition 1 of the policy further provided that: “the Employer shall truly record in a wages book the name of every employee and the amount of wages, salary and other earnings paid to him”.

Second Wording (late 1950s to 1960s):

“Whereas the Employer ….. carrying on the business described in the …. Schedule has made …. a written proposal and declaration, containing particulars and statements which it is hereby agreed are the basis of this Contract …. and has paid the premium mentioned in the Schedule, which premium is subject to adjustment as hereinafter provided,

this Policy witnesseth that if at any time during the period of the indemnity as stated in the Schedule or during any subsequent period for which the Company may accept premium for the renewal of this Policy any person of a description mentioned in the Schedule who is under a contract of service or apprenticeship with the Employer shall sustain personal injury by accident or disease arising out of and in the course of employment by the Employer in work forming part of the process in the business mentioned in the Schedule, the Company will indemnify the Employer against liability at law for damages in respect of such injury or disease…

The policy provided that the Company should not be liable under it in respect of “accidents occurring elsewhere than in Great Britain, Northern Ireland, the Isle of Man or the Channel Islands”.

The policy provided that premiums were to be regulated by the amount of wages, salaries, or other earnings paid to employees by the employer during each period of insurance, with a wages book being kept open to inspection for that purpose and the employer supplying the correct amounts within one month of the expiry of each insurance period.

Condition 1 and the Schedule were in similar form to those in the first wording. Third Wording (1970 to 1976)

After a recital in the same form as the second wording, this wording provided:

that if at any time during the period of the indemnity as stated in the Schedule or during any subsequent period for which the Company may accept premium for the renewal of this Policy any person of a description mentioned in the Schedule who is under a contract of service or apprenticeship with the Employer shall sustain personal injury by accident or disease arising out of and in the course of

employment by the Employer in the business mentioned in the Schedule, the Company will indemnify the Employer against liability at law for damages in respect of such injury or disease…

Under the third wording, there was the same territorial limitation as under the second wording in relation to accidents occurring elsewhere than in Great Britain, etc.

Premiums were also regulated by reference to wages, salaries, etc. and condition 1 and the Schedule were in the same terms as in the second wording.

  1.  Independent

Sole wording in Issue (1972 to 1987):

This was a “Contractors Combined Policy”, covering Employers’ Liability (section 1), Public Liability (section 2) and Loss of or Damage to Contract Works (section 3). It provided:

NOW THIS POLICY WITNESSETH that during the Period of Insurance or during any subsequent period for which the Company may accept payment for the continuance of this Policy and subject to the terms, exceptions and conditions contained herein and or endorsed hereon, the Company will indemnify the Insured as hereinafter specified.

SECTION 1 – EMPLOYERS’ LIABILITY

If any person who is under a contract of service or apprenticeship with the Insured shall sustain bodily injury or disease arising out of and in the course of his employment by the Insured in connection with the Contract specified or type of work described in the Schedule the Company will indemnify the Insured against all sums for which the Insured shall be liable at law for damages for such injury or disease…

The Policy provided that the Company was not to be liable “for injury, illness, loss or damage caused elsewhere than in Great Britain, the Isle of Man or the Channel Islands”.

As a result of the ELCIA 1969 making insurance in respect of employers’ liability compulsory, the Independent wording also contained the further provision (“the ELCIA extension provision”):

“AVOIDANCE OF CERTAIN TERMS AND RIGHT OF RECOVERY

The indemnity granted by section 1 of this Policy is deemed to be in accordance with the provisions of any law relating to compulsory insurance of liability to employees in Great Britain…

It is agreed the Insured shall repay to the Company all sums paid by the Company which the Company would not have been liable to pay but for the provisions of such law…”

The policy Schedule contains spaces for entry of first, annual and minimum premium, as well as of the name of the “Principal” for whom the insured is undertaking work, the details of the contract or type of work covered by the policy and its situation. Condition 7 provides that the premium “is based on estimates provided by the Insured”, for record-keeping, for the supply of updated information as required by the Company within one month of the expiry of each insurance period and for adjustment of the premium on that basis.

  1.  MMI

First Wording (1949 to 1958)

…the Company hereby agrees that if at any time during the period of insurance specified in the schedule or thereafter during any subsequent period for which the Insured shall agree to pay and the Company shall agree to accept a renewal premium of the amount specified in the said schedule, or of such other amount as the Company shall from time to time require, any person under a contract of service with the Insured shall sustain any personal injury by accident or disease arising out of and in the course of his employment by the Insured in their activities described in the schedule and if the Insured shall be liable to pay damages for such injury or disease then, subject to the terms and conditions contained herein or endorsed hereon, the Company shall indemnify the Insured against all sums for which the Insured shall be so liable…

The policy was expressed not to apply to or include liability “in respect of injury or disease caused elsewhere than in Great Britain, Northern Ireland, the Isle of Man or the Channel Islands”.

Condition 5 regulated premiums by reference to wages, salaries, etc, and made provision for a wages book and adjustment to like effect to the Excess second wording.

The policy Schedule provided for the classification of staff and employees according to departments and job description, with corresponding figures for estimated total remuneration.

Second Wording (1958 to 1974)

…the Company hereby agrees that if at any time during the First Period of Insurance specified in the said Schedule or during any subsequent period for which the Insured shall agree to pay and the Company shall agree to accept a renewal premium of the amount specified as the Renewal Premium in the said Schedule or of such other amount as the Company shall from time to time require, any person under a contract of service with the Insured shall sustain any bodily injury or disease arising out of and in the course of his employment by the Insured in the Insured’s activities described in the said Schedule and if the Insured shall be liable to pay damages for such injury or disease or for death resulting from such injury or disease then, subject to the terms, exceptions and conditions contained herein or endorsed hereon or set out in the Schedule to this Policy…the Company will indemnity the Insured against all sums for which the Insured shall be so liable…

Like the first wording, this wording contained a territorial exclusion of liability in respect of injury or disease caused elsewhere than in Great Britain, etc.

The policy Schedule provided for the entry of the “Estimates (if any) on which the premium is calculated”, including in particular any such estimate of wages, salaries, etc. paid to staff, and cross-referred to condition 7, which provided that, if the premium had been based on any estimates, an accurate record should be kept (of actual amounts), the insured should provide insurers with such particulars and information as might be required within one month of the expiry of the policy period and the premium adjusted accordingly.

Third Wording (1974 to 1992)

The Company agrees to indemnify the Insured in respect of all sums without limit as to amount which the Insured shall be legally liable to pay as compensation for bodily injury or disease (including death resulting from such bodily injury or disease) suffered by any person under a contract of service or apprenticeship with the Insured when such injury or disease arises out of and in the course of employment by the Insured and is sustained or contracted during the currency of this Policy.

The policy Schedule contemplated a premium adjustable in accordance with condition 5, which in turn provided (in like manner to condition 7 of the second wording) for the adjustment of any premium so calculated by reference to actual amounts at the end of the policy period.

  1.  BAI

First Wording (1953 to 1974)

…the Company will…indemnify the Insured against all sums of money which the Insured may become liable to pay to any Employee engaged in the direct service of the insured or any dependent of such Employee in respect of any claim for injury sustained or disease contracted by such Employee between…and…both inclusive…

The policy carried the note: “This policy does not cover the insured’s liability for accidents to workmen arising outside the United Kingdom”.

Conditions 1 and 2 made elaborate provision for the regulation of premiums by the amount of wages, salaries, or other earnings paid to employees by the employer during each period of insurance, with pay sheets and books of account being kept open to inspection for that purpose and the employer making a return, and the premium being adjusted, subject to a minimum, at the end of each insurance period.

Second Wording (1974 to 1983)

…the Company will…indemnify the Insured against all sums of money which the Insured may become legally liable to pay in respect of any claim for injury sustained or disease contracted by any person engaged in and upon the service of the Insured and being in the Insured’s  direct  employment  under  a  Contract  of  Service  or

Apprenticeship between the…day of…and the…day of…both inclusive…

This wording also excluded insurers from liability in respect of “accidents to employees arising outside the United Kingdom”.

Like the Independent and third MMI wordings, the BAI second wording also included the ELCIA extension provision.

Conditions 1 and 2 provided for the regulation and adjustment of premiums by reference to actual wages, salaries, etc. during each insurance period, in like terms to conditions 1 and 2 in the first wording.

  1.  Zurich

The Municipal First Select wording (1993 to 1998)

The INSURER will indemnify the INSURED in respect of all sums which the INSURED may become legally liable to pay as damages and claimants’ costs and expenses in respect of Injury sustained during the Period of Insurance by any EMPLOYEE arising out of and in the course of employment by the INSURED in the BUSINESS within the Geographical Limits.

The Municipal Second Select wording (1998 -)

The INSURER will indemnify the INSURED in respect of all sums which the INSURED may become legally liable to pay as damages and claimants’ costs and expenses in respect of Injury caused during the Period of Insurance to any EMPLOYEE arising out of and in the course of employment by the INSURED in the BUSINESS within the Geographical Limits.

The tariff wording (1948 -)

…if any person under a contract of service or apprenticeship with the Insured shall sustain any personal injury by accident or disease caused during the period of insurance and arising out of and in the course of his employment by the Insured in the business above mentioned and if the Insured shall be liable to pay damages for such

injury or disease the Association shall indemnify the Insured against all sums for which the Insured shall be so liable.

LORD CLARKE

  1. Like other members of the Court, I agree with Lord Mance on the construction issue. Thus I agree that, for the purposes of the EL policies, mesothelioma is “sustained” or “contracted” when the process that leads to the disease is initiated as a result of the wrongful exposure of the employee to the asbestos fibre or fibres which cause the disease. I do not wish to add to Lord Mance’s reasoning on the construction issue. I do however wish to add some words of my own on the causation issue which sharply divides Lord Phillips and Lord Mance. I wish to say shortly why I prefer the conclusion of Lord Mance to that of Lord Phillips.
  1. As I see it, the effect of Fairchild, Barker and Sienkiewicz may be summarised in this way. An employer who, in breach of duty, has exposed an employee to asbestos is liable in damages if the employee subsequently suffers the disease. The employee’s cause of action is not that he was exposed to the risk of mesothelioma. He has no claim unless he in fact suffers the disease. It is the disease which represents the damage which completes the cause of action and it is only then that his cause of action accrues and the relevant time limit begins to run. It is axiomatic that, in order to succeed in tort, the employee must show a sufficient causal link between the breach of duty, namely the exposure to asbestos, and the disease which represents the damage, namely mesothelioma.
  1. The effect of the majority opinion in Barker is that, where there are two or more employers who have exposed the claimant to the risk of mesothelioma, they are not jointly and severally liable to the claimant for the whole of the consequences of the disease but only severally liable for an aliquot part. That decision was reversed by the Compensation Act 2006, so that such employers are jointly and severally liable for the whole of the consequences. The question in this appeal is whether the employers’ liability insurers are liable to indemnify the employers in respect of that liability.
  1. It would in my opinion be a remarkable result if they were not. Lord Phillips notes at para 109 that Mr Edelman QC accepted that, if the correct analysis of the special rule, which (using Lord Phillips’ definitions) was the result of the combined effect of the special approach in Fairchild and Barker and the Compensation Act 2006, was that the employers were deemed to have caused mesothelioma by exposing the employees to asbestos dust, the insurers would be liable. Lord Phillips accepts that that concession was correctly made. I agree, for the reasons he gives at paras 109 to 114.
  1. The question is therefore whether the correct analysis of the special rule is indeed that the employers were deemed to have caused the mesothelioma. I accept

that in such a case the employee cannot show on the balance of probabilities that the employer’s negligence caused the disease. The effect of Fairchild and Sienkiewicz was however that the employer is liable where the exposure contributed to the risk that the employee would suffer the disease and where the employee in fact suffers the disease. That is not in dispute.

  1. Lord Phillips says at para 124 that the majority in Barker drew the vital distinction between being liable for contributing to the cause of the disease and being liable for the creation of the risk of causing the disease. He quotes para 2 of Lord Hoffmann’s speech as follows:

“Is any defendant who is liable under the exception deemed to have caused the disease? On orthodox principles, all defendants who have actually caused the damage are jointly and severally liable. Or is the damage caused by a defendant in a Fairchild case the creation of a risk that the claimant will contract the disease? In that case, each defendant will be liable only for his aliquot contribution to the total risk of the claimant contracting the disease – a risk which is known to have materialised.”

Lord Phillips further notes that at para 125 Lord Hoffmann advanced the thesis that the basis of liability was the wrongful creation of the risk or chance of causing the disease and that the damage that the defendant should be regarded as having caused was the creation of such risk or chance. See also the passages to like effect referred to by Lord Mance at para 61.

  1. I accept that Lord Hoffmann and others did indeed advance that view of Fairchild but it is I think important to note that it was in the context of the question whether, in a case of two or more employers, each was severally liable for a proportion of the consequences of the mesothelioma or whether each was jointly and severally liable for the whole. Lord Hoffmann cannot have intended to hold, without more, that the basis of liability was the wrongful creation of the risk or chance of causing the disease because there would be no liability at all but for the subsequent existence of the mesothelioma.
  1. It seems to me that, whether the majority in Barker were correct or not, there is no escape from the conclusion that, in all these cases, where it is not possible to show that the particular employer caused the claimant to suffer mesothelioma, the underlying question is who should be held responsible for causing the mesothelioma which in fact struck down the employee. None of the cases is authority for the proposition that causation is irrelevant. On the contrary, the quest is for the employer who can fairly be held liable for the consequences of

the disease and therefore for the employer who can fairly be said to have caused the disease.

  1. The courts have embarked on similar quests over the years. Lord Mance has given a number of examples. As Lord Mance shows at para 56, they include Bonnington and McGhee, where Lord Reid was prepared to take “a broad view” of causation and Lord Wilberforce rejected a traditional approach for policy or evidential reasons. In my opinion the reasoning in Sienkiewicz is of some significance in this context. Lord Mance has given the relevant references in para

61. Thus, as Lord Mance observes, at para 61 Lord Phillips said that Fairchild and Barker had “developed the common law by equating ‘materially increasing the risk’ with ‘contributing to the cause’ in specified and limited circumstances”. Lord Mance further refers to Lord Brown speaking of a “more relaxed approach to causation” and flexibility in the approach to causation at paras 178 and 187. Lord Mance had himself referred to Fairchild and Barker as involving a “special rule of causation” at para 188, and Lord Kerr referred to them as involving a “modification of the previously applicable legal rules in relation to the causation element in employers’ liability claims” at para 196 and to adjustments in the burden of proof at paras 198 and 200. Again, as Lord Mance observes at para 61 above, Lord Dyson referred (at para 207) to materially increasing the risk of contracting the disease as “sufficient to satisfy the causal requirements for liability” (para 207).

  1. Both Mr Beloff QC and Mr Stuart-Smith QC addressed these issues in their oral submissions. They both in effect submitted that the effect of Fairchild, Barker and Sienkiewicz was that the employers were deemed to have caused mesothelioma by exposing the employees to asbestos dust. They both recognised that the ordinary rule of causation could not apply and that some element of policy or doctrine was required in order to explain Fairchild. Mr Stuart-Smith submitted that the effect of Fairchild was that each material exposure to asbestos dust is doctrinally held responsible for the mesothelioma. Mr Beloff’s submission was to much the same effect. He relied upon a dictum of Lord Walker in Barker at para 109:

“A rule of law by which exposure to risk of injury is equated with legal responsibility for that injury entails the possibility that an employer may be held liable for an injury which was not in fact caused by that exposure (though in the present state of medical science, that fact can be neither proved nor disproved).”

The injury is of course the mesothelioma, which is necessary to complete the cause of action. On that basis it seems to me that Lord Walker’s statement that the risk of injury is equated with legal responsibility for the injury is in effect to say that, by

creating the risk of mesothelioma in the future, the employer is deemed to have caused the mesothelioma, if it should develop in the future.

  1. It appears to me that these conclusions are supported by Lord Mance’s analysis of section 3 of the Compensation 2006 at paras 67 and 68, with which I agree and to which I do not wish to add anything.
  1. Given Mr Edelman’s concession that, if that is correct, the employers are liable under the policies (and this Court’s acceptance of it) I would hold that the causation point does not assist the insurers.
  1. I would only add this. It appears to me that, once it is held that, on these facts, the employers are liable to the employees, it would be remarkable if the insurers were not liable under the policies. Rather as in AXA, the whole purpose of the policies was to insure the employers against liability to their employees. That purpose would be frustrated if the insurers’ submissions on this point were accepted. I agree with Lord Mance, for the reasons he gives at paras 69 – 73 that these policies respond to these claims.
  1. For these reasons, I too would dismiss the appeals by insurers so far as they concern the policies with “contracted” wordings. I would allow the appeals against insurers, and dismiss the appeal by the Independent, so far as they concern policies with “sustained” wordings.

LORD DYSON

  1. I too agree with Lord Mance on the construction issue. As to the causation issue, I agree with the reasoning of Lord Mance and Lord Clarke. Accordingly, I would dismiss the appeals by insurers in so far as they concern the policies with “contracted” wordings. I would allow the appeals against insurers, and dismiss the appeal by the Independent, so far as they concern policies with “sustained” wordings.

LORD PHILLIPS

Introduction

  1. So called “long tail” industrial diseases have raised peculiar difficulties in the field of tort. These diseases result from the effect on the body of exposure to noxious substances. The effect can be long, drawn out and mysterious, in as much as medical science has not yet identified the precise mechanism, or chain of causation, by which the noxious substance causes the disease. Mesothelioma is a long tail disease in which the problems raised have been particularly acute.
  1. The problems arise in the application of principles of law that do not ordinarily give rise to difficulty. An employer will be liable in damages if by an act or omission that is negligent or in breach of statutory duty he causes physical harm to an employee. In the vast majority of cases there will be no difficulty in identifying the moment at which the negligence or breach of duty causes the physical harm, for the harm will take the form of an obvious injury. This is not the position in respect of mesothelioma. Asbestos dust, inhaled into the lungs, is the agency that causes mesothelioma, but as long as forty or fifty years may elapse before the effects on the body of dust inhaled culminate in symptoms of mesothelioma. Once the symptoms are felt, the disease will develop swiftly to bring about an inevitable and extremely unpleasant death. Where a victim of mesothelioma was exposed to asbestos dust over a period of years it is impossible, even with hindsight, to determine on balance of probabilities whether dust inhaled in a particular year caused or contributed to the development of the mesothelioma. It follows that, where the victim worked for a series of employers, each of whom exposed him to asbestos dust, it is impossible to prove on balance of probability that any particular employer caused or contributed to the victim’s mesothelioma. This means that the normal principles of the law of tort provide no remedy to the employee or his dependants.
  1. The manifest injustice of this position led the House of Lords in Fairchild v Glenhaven Funeral Services Ltd [2002] UKHL 22; [2003] 1 AC 32 and Barker v

Corus UK Ltd [2006] UKHL 20; [2006] 2 AC 572 to create what I shall describe as a “special approach” to causation in respect of mesothelioma, whose effect was immediately varied by Parliament by section 3 of the Compensation Act 2006. I shall describe the composite result achieved by the House of Lords and Parliament as the “special rule”. I shall examine the nature of this special rule in due course. Its effect was, however, to place each employer in the same position as that employer would have been under at common law if it were proved, on balance of probability, that its negligence or breach of duty in exposing the employee to asbestos dust had contributed to causing the employee’s mesothelioma.

  1. These developments of the law of tort have formed the backdrop to the issue that has occupied almost all of the eight days that this Court has devoted to this appeal. I shall call this issue “the construction issue”. The construction issue relates to the true construction of a number of policies of insurance against employers’ liabilities (“EL policies”) with similar, but not identical, provisions as to the cover provided. The EL policies provided cover by reference to specific periods – usually of a year. The central issue relates to the event or events that, on true construction of each policy, had to occur within the period of the policy in order to render the insurer liable to indemnify the employer in respect of liability for causing an employee’s mesothelioma. The policies provided cover in respect of diseases “sustained” or “contracted” during the period of the policy. The meaning of each of those words, in its context, lies at the heart of the construction issue.
  1. It does not seem that the construction issue initially received a great deal of consideration. Insurers treated the policies as if they covered an employer whose breach of duty within the period of the policy had contributed to causing the disease and regarded this requirement as satisfied if the employer was held liable because he had exposed the employee to asbestos dust during that period. Where more than one insurer was liable on this basis, they apportioned liability according to the period of exposure covered by each.
  1. The attitude of four of the five insurers party to this appeal changed as a result of the decision of the Court of Appeal in Bolton Metropolitan Borough Council v Municipal Mutual Insurance Ltd [2006] EWCA Civ 50; [2006] 1 WLR 1492. Those insurers are MMI, Excess, BAI and Independent, each of which is in run-off. I shall describe them collectively as “the insurers”. Their opponents I shall describe collectively as “the employers”, although they embrace solvent employers, individuals claiming under the Third Party (Rights against Insurers) Act 1930, and Zurich, which has a community of interest with these.
  1. Bolton concerned the scope of cover of a public liability policy (“PL policy”) in relation to liability for causing mesothelioma. The policy provided cover in respect of an injury that “occurs during the currency of the policy”. The argument proceeded on the premise that the chain of causation of mesothelioma, once it was diagnosed, could be traced back to the initial inhalation of asbestos dust. The issue was whether the mesothelioma could properly be said to have “occurred” at the time of the initial inhalation. The Court of Appeal held that it could not. The injury only occurred, at earliest, at the stage of development of the disease at which malignancy occurred. This was, on the evidence, ten years, give or take a year, from the date on which it became possible to diagnose the existence of the tumour but very many years after the initial inhalation of asbestos dust.
  2. This decision led the insurers to take the point that a similar approach should be taken to the interpretation of the cover afforded by the EL policies. Mesothelioma was not, on true construction of the policies, “sustained” or “contracted” at the time of the initial inhalation of asbestos dust. It was only “sustained” or “contracted” at the much later stage when, as a consequence of the process initiated by asbestos dust, an actionable injury in the form of malignancy, developed.
  1. Before Burton J, the Court of Appeal and this Court the construction issue has been argued at great length and in great detail. I agree, as do the other members of the Court, with the conclusions reached by Lord Mance on the construction issue. These conclusions have application not merely to mesothelioma but to employers’ liabilities in relation to other long tail industrial diseases such as asbestosis and pneumoconiosis. For the purpose of EL policies, these diseases are “sustained” or “contracted” when the process that leads to the disease is initiated as a result of the wrongful exposure of the employee to the noxious substance that causes, or contributes to the cause or the extent of, the disease.
  1. Throughout the hearing of this appeal there has lurked a second issue. It has not been the subject of argument below, nor does it feature in the agreed Statement of Facts and Issues. This is, perhaps, because it relates to a point that does not arise out of Bolton. It has always been there for the taking, but insurers have not hitherto chosen to raise it, perhaps because its consequences are unattractive. It arises out of a problem that is similar to that which led the House of Lords to formulate the special approach in Fairchild and Barker. It is not possible for an employer to prove that an employee’s mesothelioma was, in fact, caused in whole or in part by any particular period of exposure to asbestos dust. Thus the employer cannot prove, on balance of probability, that the mesothelioma for which he has been held liable under the special rule was, in fact, initiated in any particular policy year. How, then, can he prove that his liability falls within the scope of the cover, even if the policy bears the construction contended for by the employers and upheld by this Court? How can he prove that his liability arises out of disease “sustained” or “contracted” within the policy period, giving these words the same meaning as “initiated”? I shall call this issue the “causation issue”.

The causation issue and the judgments below

  1. Although the causation issue was not raised in argument below, it was dealt with, at least implicitly, in the judgments of both courts. Burton J at first instance, and Rix and Stanley Burnton LJJ in the Court of Appeal proceeded on the basis that, in the case of a mesothelioma victim, exposing the victim to asbestos dust could be treated as equivalent to causing his disease. This approach was based on the special rule. Thus Burton J at paras 42 to 58 summarised, without significant

comment, what he described as the “special mesothelioma jurisprudence” as it was at the time of his judgment. This included Fairchild, Barker and the 2006 Compensation Act. He thereafter proceeded on the basis that exposing a mesothelioma victim to asbestos dust could be treated as having been equivalent to causing the victim to contract the disease. Thus, when summarising his conclusions at para 243 he said:

“I conclude, in relation to the policies in issue before me, that they respond, just as would policies with caused wording, to claims against insurers where employers are liable on the basis of inhalation by employees during the policy period. They respond, consistently with other EL policies, in respect of mesothelioma claims, on an ‘exposure’ basis. For the purposes of these policies, injury is sustained when it is caused and disease is contracted when it is caused, and the policies fall to be so construed.”

  1. Rix LJ drew a distinction between the meaning of “contracted” and “sustained”. “Contracted” referred to the “time of the disease’s causal origins” – para 245. He felt constrained by Bolton, however, to hold that no injury was “sustained” until the disease reached the malignant stage. Implicit in his judgment was the premise that exposure to asbestos dust during the period of the policy could be treated as the causal origin of the disease – see for example his comments at para 244. A difficult passage in his judgment at paras 280-283, when considering the meaning of “injury”, suggests that this premise was founded on the special rule. Thus he was able to conclude that the disease was contracted at the time that the victim was exposed to asbestos dust albeit that injury was not sustained at that point.
  1. In a short judgment Stanley Burnton LJ adopted similar reasoning. He stated, at para 338:

“We are agreed that in any year in which there was substantial exposure to asbestos, mesothelioma was ‘caused’ by that exposure during that year. The fact that the disease did not develop for some years does not break the chain of causation.”

Submissions on the causation issue

  1. The causation issue was not raised by the insurers as a discrete issue. It none the less surfaced in a passage of the written case for Excess that was addressing the employers’ case that “personal injury by disease” was “sustained”

at the moment of inhalation of asbestos dust that “triggered” “the process of sustaining personal injury by disease”. One of the arguments advanced by Excess in answer to this submission read as follows:

“Medically and empirically, one cannot be said to have suffered an ‘injury’ on a particular day because it cannot be known in (say) a 10 year occupational exposure period on which of the 3652 days the fatal dose was inhaled (and it may be on more than one). It is likely that any ingestion on a particular day was irrelevant to the development of the final condition. There has been a tendency on the part of the claimants to treat inhalation as a single event from which an unbroken line can be drawn to malignancy. It is not. Inhalation (and hence on this theory) ‘injury’ may occur over several thousands of days. Each day does not bring ‘injury’. Any particular day cannot therefore be selected as ‘injury day’. To overcome problems of medical causation in a personal injury action against an employer, the House of Lords extended the McGhee principle to mesothelioma in Fairchild. However this was a rule of causation and not definition. There is no such rule in insurance policies which defines what amounts to an ‘injury’. The Supreme Court in Sienkiewicz stressed the limits of the Fairchild exception in no uncertain terms, and it is submitted that it would be quite wrong for it now to invade the law of contract. A liability policy responds only to indemnify against a liability (i.e. actionable injury). There is no such liability on inhalation. Injury occurs when the claimant has a personal injury by disease.”

Thus Excess took the point that the special rule could not properly be invoked to establish that, on true construction of the contracts of insurance, injury was sustained upon inhalation of asbestos dust.

  1. This passage appeared after a submission at para 209 that it was only possible to equate the inhalation of a culpable quantity of asbestos dust with “sustaining personal injury by disease” by, inter alia, creating a special rule governing the response of EL policies in respect of mesothelioma, and possibly other long tail diseases. This proved to be what counsel for the employers sought to do when invited by the Court to address the causation issue. They did so in short oral submissions that cannot, when taken together, have occupied more than half an hour of the eight day hearing.
  1. The relevant submissions made by Mr Beloff QC for Akzo and AMEC and the Local Authorities are reported at pp 120-122 of the transcript for 15 December 2011. He started by observing that we had to “cut the Gordian knot”. He suggested

that we should do so by equating creation of a risk with causing bodily injury. This he submitted was permissible because the object of the policy was to provide cover to an employer who, in breach of duty to employees, caused them compensatable damage. Were this approach not adopted, it would be impossible to show that any of a number of insurers providing cover over a period of years was liable. The law should rebel against such a result. In support of this submission Mr Beloff cited a statement by Lord Walker of Gestingthorpe in Barker at para 109 suggesting that the special approach to mesothelioma equated the exposure to the risk of injury with legal liability for the injury.

  1. Mr Stuart-Smith QC for Zurich dealt with the causation issue at rather greater length in a passage reported at pp 126 to 131 of the same transcript. He started by accepting that it was impossible to know when the metabolic changes that led to the development of mesothelioma in fact occurred. Fairchild dealt with this problem by creating a “doctrinal” rule under which each significant exposure to asbestos dust was held to be responsible for the mesothelioma. Thus “doctrinally” the process of developing mesothelioma started upon inhalation. This doctrinal framework for the application of the law of tort was that within which policies of insurance against tortious liability had to operate. Mr Stuart-Smith agreed with this summary of his argument advanced by Lord Mance:

“If the law of tort treats someone, an employee, as having sustained a personal injury and treats the employer as liable to pay damages for such personal injury, then the policy answers.”

  1. These submissions on behalf of the employers raise the following questions:
  1. Will the policies respond to fictional or doctrinal events that are deemed to have occurred under the special rule? If so:
  1. Does the special rule deem that events have occurred to which the policies should respond? If not:
  1. Can this Court properly reformulate the special rule in such a way as to require the policies to respond?

Will the policies respond to fictional or doctrinal events?

  1. On the premise that he failed on the construction issue, Mr Edelman accepted that, if the correct analysis of the special rule was that the employers

were deemed to have caused the mesothelioma by exposing the victims to asbestos dust, then the policies should properly respond. Because of the view that I take of the next two questions I do not need to decide whether the concession was properly made. I have, however, concluded that it was. The policies exist to provide protection against employers’ liability in tort. If the law of tort, whether laid down by the courts or by Parliament, resorts to legal or doctrinal fictions, it seems logical that the policies should respond as if the fictions were facts. A purposive approach to construction of the policies would lead to this result. Two examples illustrate this approach.

  1. Ellerbeck Collieries Ltd v Cornhill Insurance Co Ltd [1932] 1 KB 401 involved a policy of insurance against liability under the Workmen’s Compensation Act 1925. The terms of the policy entitled the employer to indemnity if at any time during the currency of the insurance any employee sustained any personal injury by accident or disease. The 1925 Act imposed a fictitious test for identifying when an industrial disease was sustained, namely the date on which a certifying surgeon issued a certificate that the employee was suffering from the disease. On the strength of a certificate issued within the currency of a policy of insurance an employer was held liable to two workmen who had, in fact, sustained the relevant disease before the period of the insurance began. The Court of Appeal held that this liability fell within the cover of the policy. The argument for applying the fictional date was a strong one because, as Greer LJ observed at p 417, the policy was intended to cover the employer’s liability under the Act. The parallel between Ellerbeck and the present case would have been stronger had the relevant policies been taken out after the special rule had been created.
  1. In Rothwell v Chemical & Insulating Co Ltd [2007] UKHL 39, [2008] AC 281 the House of Lords held that pleural plaques caused by exposure to asbestos dust did not constitute actionable injury because they produced no adverse physical effects. The Scottish Parliament responded to this decision by introducing the Damages (Asbestos-related Conditions) (Scotland) Act 2009 (“the Scottish Act”). That Act provides by section 1 that asbestos-related pleural plaques constitute a personal injury which is not negligible and that accordingly they constitute actionable harm for the purpose of an action for damages for personal injury. In AXA General Insurance Ltd v HM Advocate [2011] UKSC 46, [2011] 3 WLR 871 the Supreme Court rejected a challenge by insurers to the lawfulness of this Act.
  1. The Scottish Act effected a limited alteration to the common law in decreeing that asymptomatic pleural plaques constituted non-negligible personal injury and thus actionable damage. Lord Mance at para 88 suggested that the main target of the legislation was employers’ insurers. He went on at para 89 to consider

whether the Act would, in fact, alter the meaning to be given to “bodily injury” under a policy of insurance:

“A Scottish Act will not on the face of it change the legal effect of an English insurance contract, even in Scotland. However, depending upon the particular policy language, the scope of the concept of bodily injury under a worldwide policy may respond to different conceptions of bodily injury in different parts of the world. Here, the question would be whether it would respond to a development or change, such as that introduced retrospectively by the 2009 Act, in the conception of bodily injury. I say no more about the answer, which may be elicited in another context or suit.”

  1. While Lord Mance left open the effect of the Scottish Act on the construction of policies of liability insurance, Lord Brown was in no doubt that the effect of the Scottish Act was to subject insurers to liabilities to which they would not have been subject prior to that Act. He referred at para 80 to the “undoubted, and deliberate, impact of the legislation upon pending claims”. Earlier, at para 77, he drew an analogy with the effect of the decision in Fairchild on EL insurers’ liability:

“Had the House of Lords in Rothwell decided that asymptomatic pleural plaques of themselves constitute a non-negligible personal injury and thus actionable damage – decided in other words that in this particular context the common law should develop in this admittedly novel way – the appellants would doubtless have deplored the decision but they could certainly not have questioned its legitimacy. No doubt they would have resented the fact that, as a consequence of the decision, they would unexpectedly have had to pay out on claims resulting from the employee’s exposure to asbestos upwards of 20 years (quite likely up to 40 years) previously. But they could no more have advanced an [article 1, Protocol 1] challenge to this development of the law than they could have challenged the House of Lords decision some four years earlier in Fairchild v Glenhaven Funeral Services Ltd [2003] 1 AC 32 to adopt a less stringent than the usual ‘but for’ test for establishing the necessary causal connection between an employer’s negligence and a claimant’s condition in, most notably, mesothelioma cases. Employers (and their liability insurers) necessarily take the risk of the common law developing in ways which may adversely affect them with regard to personal injury claims.”

  1. In this passage Lord Brown assumed that the effect of Fairchild was to bring employers’ liabilities in respect of mesothelioma within the scope of the cover afforded by EL policies. I am about to consider whether he was correct in this. I agree, however, with the general principle expressed in the last sentence of the extract from his judgment that I have just cited. It is for this reason that I would give an affirmative answer to the first of the three questions posed at para 108 above. I turn to the second.

What is the special rule?

  1. The employers’ submissions on the causation issue proceed on the premise that the special rule deems exposure to asbestos dust of an employee who is subsequently diagnosed with mesothelioma to have been a cause of the mesothelioma. I have reached the conclusion that that premise is unsound.
  1. In Sienkiewicz v Greif (UK) Ltd [2011] UKSC 10; [2011] 2 AC 229 I summarised the special rule as follows at para 1:

“When a victim contracts mesothelioma each person who has, in breach of duty, been responsible for exposing the victim to a significant quantity of asbestos dust and thus creating a ‘material increase in risk’ of the victim contracting the disease will be held to be jointly and severally liable for causing the disease.”

This is certainly the effect of the special rule, but in order to discover the juridical basis of the rule it is necessary first to identify the basis of the special approach adopted by the House of Lords in Fairchild and Barker and then to consider the effect of section 3 of the Compensation Act, which adapted the special approach into the special rule.

The special approach

  1. In Sienkiewicz, at para 70, I stated that Fairchild and Barker

“developed the common law by equating ‘materially increasing the risk’ with ‘contributing to the cause’ in specified and limited circumstances, which include ignorance of how causation in fact occurs”.

As I shall show, this was not an accurate summary of the special approach

adopted in those cases.

  1. In Fairchild the House of Lords confronted the position where a mesothelioma victim had worked consecutively for a number of employers, each of which had exposed him to asbestos dust. One or more of these had caused his mesothelioma, but because of the limits of medical knowledge it was not possible, on balance of probability, to identify which. In these circumstances their Lordships adopted a special approach that enabled them to find that each of the employers was jointly and severally liable for the mesothelioma. In doing so they purported to be following a similar approach adopted by the House of Lords in McGhee v National Coal Board [1973] 1 WLR 1. They were not, however, all agreed as to the basis of that approach. Lord Hutton, at para 109, held that it was

“…based on the drawing of a factual or legal inference leading to the conclusion that the breach of duty [in exposing the employee to asbestos dust] was a cause of the disease.”

  1. The majority of the House did not agree. Lord Bingham said, at para 35:

“I prefer to recognise that the ordinary approach to proof of causation is varied than to resort to the drawing of legal inferences inconsistent with the proven facts”.

  1. Lord Nicholls of Birkenhead said, at para 42:

“So long as it was not insignificant, each employer’s wrongful exposure of its employee to asbestos dust, and, hence, to the risk of contracting mesothelioma, should be regarded by the law as a sufficient degree of causal connection. This is sufficient to justify requiring the employer to assume responsibility for causing or materially contributing to the onset of the mesothelioma when, in the present state of medical knowledge, no more exact causal connection is ever capable of being established.”

  1. Lord Hoffmann at para 65 rejected the suggestion that the House in McGhee held that materially increasing the risk of the disease should be treated as equivalent to material contributing to the injury. He concluded:

“I would respectfully prefer not to resort to legal fictions and to say that the House treated a material increase in risk as sufficient in the circumstances to satisfy the causal requirements for liability”.

  1. Lord Rodger of Earlsferry did not agree. His reasoning was close to that of Lord Hutton. He held, at para 168:

“Following the approach in McGhee I accordingly hold that, by proving that the defendants individually materially increased the risk that the men would develop mesothelioma due to inhaling asbestos fibres, the claimants are taken in law to have proved that the defendants materially contributed to their illness.”

  1. What  then  happened  has  been  summarised  by  Lord  Hoffmann  in

Perspectives on Causation (2011) at p 8:

“There are two ways in which one could characterise this change in the substantive law of negligence. One is to say that the causal requirements for an action for damages for mesothelioma have been changed; all that is necessary is to prove that the risk has been increased and that the specific exposure may have provided the actual agent. The other is to say that the House created, exceptionally, a cause of action for the increased risk of mesothelioma rather than for the disease itself. In the former case, satisfying the new causal requirement would entitle the claimant to sue for the whole injury caused by contracting the disease. In the latter case, he would be able to sue only for the loss caused by the risk of his contracting the disease having been increased. That would be a proportion of the injury caused by the disease, depending on the extent to which the risk had also been created by other causes.

In Barker v Corus the House of Lords (Lord Rodger of Earlsferry dissenting) adopted the second explanation of what had happened in Fairchild.

  1. I believe that this summary of the position is essentially correct. The majority in Barker were persuaded that justice would best be served if the special approach adopted in Fairchild were applied in such a way as to render each defendant who had wrongfully exposed the claimant to asbestos dust severally liable for that proportion of the mesothelioma that represented the proportion of the wrongful exposure attributable to that defendant. This was achieved by holding

that the liability of each defendant resulted from adding to the risk that the employee would contract mesothelioma. It did not result from an implication that each defendant had actually contributed to the cause of the disease. At the start of his speech at para 2 Lord Hoffmann drew the vital distinction between being liable for contributing to the cause of the disease and being liable for the creation of the risk of causing the disease:

“Is any defendant who is liable under the exception deemed to have caused the disease? On orthodox principles, all defendants who have actually caused the damage are jointly and severally liable. Or is the damage caused by a defendant in a Fairchild case the creation of a risk that the claimant will contract the disease? In that case, each defendant will be liable only for his aliquot contribution to the total risk of the claimant contracting the disease – a risk which is known to have materialised.”

  1. Lord Hoffmann went on to adopt the latter analysis as the basis of liability in Fairchild. At para 31 he held that the majority in Fairchild had not proceeded upon the fiction that a defendant who had created a material risk of mesothelioma was deemed to have caused or materially contributed to the contraction of the disease. The creation of a material risk of mesothelioma was sufficient for liability. At para 35 he advanced the thesis that the basis of liability was the wrongful creation of the risk or chance of causing the disease and that the damage that the defendant should be regarded as having caused was the creation of such risk or chance. Liability for the mesothelioma that developed should be apportioned according to the contribution that each defendant made to the risk that mesothelioma would be contracted.
  1. Lord Scott of Foscote and Lord Walker of Gestingthorpe expressly agreed with both Lord Hoffmann’s conclusion that liability for the mesothelioma fell to be apportioned and with his reasons for so concluding. Lord Scott held at para 53 that it was essential to keep firmly in mind that liability in Fairchild was not imposed on any of the defendant employers on the ground that the employer’s breach of contract had caused the mesothelioma. That causative link had not been proved against any of them. It was imposed because each, by its breach of duty, had materially contributed to the risk that the employee would contract mesothelioma. At para 61 he emphasised that the Fairchild principle was not based on the fiction that each defendant had actually caused the eventual outcome. It was based on subjecting the victim to a material risk.
  1. Lord Walker, having stated that he was in full agreement with Lord Hoffmann’s reasons went on at para 104 to make a statement that was inconsistent with them, this being to the same effect as the statement relied on by Mr Beloff –

see para 106 above. Lord Walker stated that the decision in Fairchild equated exposing the victim to the risk of injury with causing his injury. This was the same mistake as I made in Sienkiewicz – see para 117 above. Had this been the case, each defendant would have been jointly and severally liable for the injury. Lord Walker went on to say, however, that the result in Fairchild was achieved, not by some fiction, but as an explicit variation of the ordinary requirement as to causation. At para 113 he stated that Fairchild was decided by the majority, not on the fictional basis that the defendants should be treated as having caused the victim’s damage, but on the factual basis that they had wrongfully exposed him to the risk of damage.

  1. Lady Hale did not adopt Lord Hoffmann’s thesis that the creation of risk constituted the damage for which each defendant was liable. In general, however, she agreed with the majority. She held that in Fairchild, for the first time in our legal history defendants were made liable for damage even though they might not have caused it at all. It was not said that the defendants had caused or materially contributed to the harm. All that could be said was that each had contributed to the risk of harm. In these circumstances it was sensible and fair to apportion liability for the harm in proportion to the contribution that each had made to the risk of harm.
  1. Lord Rodger of Earlsferry vigorously dissented from the reasoning of the majority and from the result in so far as it apportioned liability. He observed at para 71 that the majority were not so much reinterpreting as rewriting the key decisions in McGhee and Fairchild. At para 85 he stated that the new analysis that the House was adopting would tend to maximise the inconsistencies in the law.
  1. I have some sympathy with the observations of Lord Rodger. It would, I think, have been possible for the House in Barker to have defined the special approach in Fairchild as one that treated contribution to risk as contribution to the causation of damage. The important fact is, however, that the majority did not do so. They were at pains to emphasise that the special approach was not based on the fiction that the defendants had contributed to causing the mesothelioma. Liability for a proportion of the mesothelioma resulted from contribution to the risk that mesothelioma would be caused and reflected the possibility that a defendant might have caused or contributed to the cause of the disease. This was no obiter expression of opinion. It formed the basis of the substantive decision that liability was severable and not joint.

The special rule

  1. The special approach rendered each employer who had wrongfully exposed a mesothelioma victim to asbestos dust liable for a proportion of the mesothelioma without creating any inference or legal fiction that the employer in question had actually contributed to causing the disease. Section 3 of the Compensation Act altered the position by imposing joint and several liability on those who were only severally liable under the special approach. Did the special rule that resulted involve a different basis of liability to that which formed the basis of the special approach? This question is considered by Jonathan Morgan in his interesting Chapter 4 of Perspectives on Causation headed “Causation, Politics and Law: The English- and Scottish – Asbestos Saga”. At p 79 he poses the following question:

“Has Parliament, by implication, therefore also reversed Lord Hoffmann’s principled reinterpretation of Fairchild? Is the nature of Fairchild liability now after all for ‘causing mesothelioma’ and not ‘increasing risk’?”

  1. Mr Morgan gives a negative answer to this question, expressing the view that Barker has altered the jurisprudential basis of the Fairchild liability irrevocably. I agree that section 3 of the Compensation Act did not alter the jurisprudential basis of the special approach laid down by the House of Lords in Fairchild and Barker. All that it did was to alter the effect of the special approach by making each defendant jointly and severally liable for the whole of the injury sustained. Section 3(1) provides that the section applies where

“(c) because of the nature of mesothelioma and the state of medical science, it is not possible to determine with certainty whether it was the exposure [for which the defendant was responsible]…or another exposure which caused the victim to become ill, and (d) the responsible person is liable in tort…(whether by reason of having materially increased a risk or for any other reason)”.

It is not possible to read section 3 as imposing a different basis of liability to that identified by the majority in Barker.

The consequence of the special rule

  1. Having regard to its jurisprudential basis I cannot see how the employers can found upon the special rule as identifying the policy year or years in which a victim’s mesothelioma is initiated. The position is that it is impossible to prove on

balance of probability when mesothelioma is initiated, or contracted, or sustained, giving each of those words the same meaning. The special rule does not fill the gap for it raises no implication or fictional assumption as to when mesothelioma is initiated. The consequence is that if claimants have to show that mesothelioma was initiated in a particular policy year in order to establish that insurers are liable they are unable to do so.

Should this Court redefine the special rule in order to engage the EL policies?

  1. The special approach of the majority in Barker had the object of ensuring that employers who had wrongfully subjected their employees to asbestos dust should bear what the majority considered to be a fair share of responsibility for their wrongdoing. It does not seem likely that the majority gave consideration to the implications for the responsibility of EL insurers of the manner in which this object was achieved. Should this Court now redefine the special rule with the object of enabling claims to be brought under the EL policies? This would, I think, involve holding that the majority in Barker erred in their analysis and that the true basis of the special approach in Fairchild was that contribution to risk should be deemed to be contribution to causation.
  1. I would give a firm “No” to this question. The adoption of the special approach in Fairchild has provoked considerable criticism, both judicial and academic. An example of the former is to be found in the judgment of Lord Brown in Sienkiewicz. An example of the latter is Mr Morgan’s closely reasoned Chapter 4 of Perspectives on Causation. But the object of the special approach in Fairchild and Barker was at least to ensure that those who had breached the duties that they owed to their employees did not escape liability because of scientific uncertainty. It would be judicial law-making of a different dimension to create a legal fiction as to the policy years in which cases of mesothelioma were initiated in order to render liable insurers who could not otherwise be shown to be liable.
  1. The Secretary of State has intervened in this appeal and has submitted that, should the claims of employees or their dependants not be met by insurers, they are likely to be a burden on the public purse. It is open to question whether this is a proper consideration, even when considering whether the special rule should be redefined for what are essentially reasons of policy. In any event it seems to me that the position is somewhat more complex than the Secretary of State suggests. The burden of claims in respect of mesothelioma on a scale that was never anticipated is reducing both employers and insurers to insolvency. If this Court were to redefine the special rule so as to impose liability for mesothelioma claims on EL insurers where it could not otherwise be made out, this would in many cases be at the expense of others with claims on the same insurers founded on facts and not legal fictions. The liabilities in respect of mesothelioma will increase the

overall shortfall on the part of insurers and this is also likely to have implications for the public purse.

  1. So far as I am concerned, however, these considerations have little relevance. Even if there were a compelling case for contending that a means should be found to render EL insurers liable, my reaction would be that this was a matter for Parliament not the courts. It would be wrong in principle for this Court to depart from the reasoning of the majority in Barker for the sole purpose of imposing liability on EL insurers.

Occupational Health & Safety Association vs Union Of India & Ors (1947) LIJR-SC

Occupational Health & Safety Association vs Union Of India & Ors (1947)

LawGlobal-Hub Indian Judgment Report – Supreme Court

K.S. Radhakrishnan, J.

1. The Petitioner, a non-profit occupational health and safety organization, registered under the Societies Registration Act, 1860, has invoked the extra-ordinary jurisdiction of this Court under Article 32 of the Constitution of India seeking the following reliefs :-

a. To issue a writ of mandamus or any other appropriate writ, order, or direction directing the Respondents to frame guidelines with respect to occupational safety and health regulations to be maintained by various industries;

b. To issue a writ of mandamus or any other appropriate writ, order or direction directing respondents to appoint and constitute a committee for the monitoring of the working of thermal power plants in India and to keep check on the health and safety norms for the workers working in their power stations;

c. To issue a writ of mandamus or any other appropriate writ, order or direction directing the respondents to pay compensation to the workers who are victims of occupational health disorders and to frame a scheme of compensation for workers in cases of occupational health disorders;

d. To issue a writ of mandamus or any other appropriate writ, order or direction directing the respondents to notify the recommendations as contained in paragraph 35 of the Petition as guidelines to be followed by thermal power plant.

2. The Petitioner represents about 130 Coal Fired Thermal Power Plants (CFTPPs) in India spread over different States in the country, but no proper occupational health services with adequate facilities for health delivery system or guidelines with respect to occupational safety are in place. Factories Act, Boilers Act, Employees’ State Insurance Act, Compensation Act, the Water (Prevention and Control of Pollution) Act, the Air (Prevention and Control of Pollution) Act, Environmental Protection Act, etc. are in place, but the lack of proper health delivery system, evaluation of occupational health status of workers, their safety and protection cause serious occupational health hazards.

3. The Petitioner herein filed I.A. No.1 of 2005 and 2 of 2007 and highlighted the serious diseases, the workers working in thermal plants are suffering from over a period of years. The Report produced by the Petitioner would indicate that half of the workers have lung function abnormalities, pulmonary function test abnormalities, senor neuro loss, skin diseases, asthama, and so on. This Court noticing the same, passed an interim order on 30.1.2008, after taking note of the various suggestions made at the Bar to reduce the occupational hazards of the employees working in various thermal power stations in the country. Following are the main suggestions put forward before this Court :

1. Comprehensive medical checkup of all workers in all coal fired thermal power stations by doctors appointed in consultation with the trade unions. First medical check up to be completed within six months. Then to be done on yearly basis.

2. Free and comprehensive medical treatment to be provided to all workers found to be suffering from an occupational disease, ailment or accident, until cured or until death.

3. Services of the workmen not to be terminated during illness and to be treated as if on duty.

4. Compensation to be paid to workmen suffering from any occupational disease, aliment or accident in accordance with the provisions of the Workmen’s Compensation Act, 1923.

5. Modern protective equipment to be provided to workmen as recommended by an expert body in consultation with the trade unions.

6. Strict control measures to be immediately adopted for the control of dust, heat, noise, vibration and radiation to be recommended by the National Institute of Occupational Health (NIOH) Ahmadabad, Gujarat.

7. All employees to abide by the Code of Practice on Occupational Safety and Health Audit as developed by the Bureau of Indian Standards.

8. Safe methods be followed for the handling, collection and disposal of hazardous waste to be recommended by NIOH.

9. Appointment of a Committee of experts by NIOH including therein Trade Union representatives and Health and Safety NGO’s to look into the issue of Health and Safety of workers and make recommendations.

4. Mr. P.P. Malhotra, learned Additional Solicitor General, submitted that the suggestions no.1 to 7 have been accepted by the Central Government stating that they are broadly covered in various existing enactments and consequently pro-occupational action would be taken for effective implementation of the relevant laws, in particular, areas covered by those suggestions. After recording the above submissions, this Court had also directed the Ministry of Labour to take steps to see that those suggestions and relevant provisions of the various Labour Acts are properly implemented to protect the welfare of the employees. Learned ASG also submitted before the Court that the Central Government would examine whether the remaining two suggestions i.e. suggestion nos.8 and 9 could be implemented and, if so, to what extent.

5. The Writ Petition again came up for hearing before this Court on 6.9.2010 and this Court passed the following order:

“Vide order dated January 30, 2008, Respondent No.1 had agreed to Guideline Nos.1 to 7.

However, time was taken to consider Guidelines Nos.8 and 9, which primarily dealt with the appointment of Committee of Experts by NIOH. The constitution of that Committee is also spelt out in Guideline No.9. Today, when the matter came up for hearing before this Court, learned Solicitor General stated that the Committee of Experts has been duly constituted by NIOH and it will submit its status report on the next occasion.

The writ petition shall stand over for eight weeks.”

6. The Government of India later placed a Report of the Committee prepared by the National Institute of Occupational Health (NIOH) titled Environment, Health and Safety Issues in Coal Fired Thermal Power Plants of the year 2011.

7. Shri Colin Gonsalves, learned senior counsel, referring to the above- mentioned Report, submitted that the Union of India as also the Committee have misunderstood the scope of the suggestion nos.8 and 9. Learned senior counsel submitted that not much importance was given to the serious health problems being faced by the workers who are working in the thermal power plants and the treatment they require as well as the payment of wages and compensation to those workers who are suffering from serious illness. Learned senior counsel pointed out that some urgent steps should be taken to ensure the health and safety of the workers, through comprehensive and timely medical examinations, follow-up treatment as well as to provide compensation for the serious occupational diseases they are suffering from. Even these vital aspects, according to the learned senior counsel, have been completely overlooked by the Committee.

8. Learned ASG submitted that the Report of the NIOH is comprehensive and all relevant aspects have been taken care of and that there are several laws to protect the health and safety of the workers who are working in the various thermal power stations in the country. Learned ASG also submitted that the Committee has recommended the need of occupational health services with adequate facilities for health delivery system and that all power generating authorities must have well defined sector-specific occupational health safety and environmental management framework. Learned ASG also submitted that the Report would be implemented in its true letter and spirit.

9. This Court in Consumer Education & Research Centre and others v. Union of India and others (1995) 3 SCC 42, has held that the right to health and medical care to protect one’s health and vigour, while in service or post-retirement, is a fundamental right of a worker under Article 21 read with Articles 39(e), 41, 43, 48-A and all related Articles and fundamental human rights to make the life of the workman meaningful and purposeful with dignity of person. The Court held that the compelling necessity to work in an industry exposed to health hazards due to indigence to bread-winning for himself and his dependents should not be at the cost of health and vigour of the workman.

10. Right to health i.e. right to live in a clean, hygienic and safe environment is a right flowing from Article 21. Clean surroundings lead to healthy body and healthy mind. But, unfortunately, for eking a livelihood and for national interest, many employees work in dangerous, risky and unhygienic environment. Right to live with human dignity enshrined in Article 21 derives its life breath from the Directive Principles of State Policy, particularly clauses (e) and (f) of Articles 39, 41 and 42. Those Articles include protection of health and strength of workers and just and humane conditions of work. Those are minimum requirements which must exist to enable a person to live with human dignity. Every State has an obligation and duty to provide at least the minimum condition ensuring human dignity. But when workers are engaged in such hazardous and risky jobs, then the responsibility and duty on the State is double-fold. Occupational health and safety issues of CFTPPs are associated with thermal discharge, air and coal emission, fire hazards, explosion hazards etc. Dust emanates also contain free silica associated with silicosis, arsenic leading to skin and lung cancer, coal dust leading to black lung and the potential harmful substances. Necessity for constant supervision and to the drive to mitigate the harmful effects on the workers is of extreme importance.

11. India is one of the largest coal producing countries in the world and it has numerous CFTPPs requiring nearly 440 million tons of coal per year. We have about 130 CFTPPs in India. The thermal power plants generate about two-third of the electricity consumed in India, while 54.3% of the energy demand is met by coal fired power generation. The NIOH in its Report in 2011 has already made its recommendations with respect to the suggestions made by this Court in its order dated 30.1.2008. Since the Central Government has already accepted suggestions no.1 to 7, at the moment we are concerned with suggestions no.8 and 9, which we reiterate as follows :-

“8. Safe methods be followed for the handling, collection and disposal of hazardous waste to be recommended by NIOH.

9. Appointment of a Committee of experts by NIOH including therein Trade Union representatives and Health and Safety NGO’s to look into the issue of Health and Safety of workers and make recommendations.”

12. The Report in para 4.1.2 has referred to various health hazards and the same is reproduced hereinbelow :-

“4.1.2 General . Use of Hazardous Material for Insulation: Certain materials such as asbestos, glass wool etc. are used for insulation. These materials are highly dangerous to human health, if inhaled or if contacted with the eye/skin surface. While handling such materials, the PPE should be provided to the workers as well as proper disposal of waste asbestos and glass wool should be ensured. Nowadays, safer substitutes, such as p-aramid, polyvinyl alcohol (PVA), cellulose, polyacrylonitrile, glass fibres, graphite are available, the use of which may be explored.

. Compliance with the provisions of the Environment (Protection) Act and its amendments from time to time applicable for the power plants with respect to emission and discharge, ash utilization and hazardous waste management should be ensured to protect the ambient environment as well as maintain safe and healthy working conditions for the workers. . The generated fly ash need to be utilized as per the CPCB annual implementation report on fly ash utilization (2009-10) that 100% utilization to be achieved by the power plants, within 5 years from the date of notification (refer to Table 17, page 48). For new CFTPPs, the fly ash utilization needs to be regulated as per the schedule given in Table 17.

. It is desirable that the coal handling facilities are mechanized and automated to the extent possible.

. Occupational health services should be provided for wide range benefit to the workers. Broadly, it should contain the facilities for occupational health delivery system with trained manpower and infrastructure including investigational facilities, environmental assessment, evaluation of occupational health status and first aid training of the workers on regular basis. These services should be independent and separate from hospital services (curative service) but should function in liaison with the curative service.

. Periodic awareness programmes regarding the health and safety with active involvement of the workers should be organized, covering each individual with the minimum annual average duration of 8 hours per worker. Regular community level awareness programmes may be organized in the vicinity of the plant for the family members of the workers. . Periodic medical examination (PME), as required under the Factories Act should be undertaken. However, the investigations performed under the PME should be relevant to the job exposures. Since coal/ash handling workers are prone to dust exposure related diseases, due attention is required to those workers. In case of need, the frequency of PME may be scheduled, based on observation of the health check-up information. Providing PPE and re-locating of job for those workers may also be considered. . As per recommendations of the Factories Act, the workers need to be examined radiologically (chest X-ray) on yearly basis. However, in order to avoid unnecessary exposure of the human body to the radiation, the regular yearly chest X-ray is not recommended, unless urgent and essential. Considering the latency period of development of pneumoconiosis, it is recommended to undergo chest X-ray every two years for initial 10 years and based on the progression, re-scheduling may be adopted. After 10 years it should be done on yearly basis or earlier depending on the development and/or progression of the disease.

. Health records should be maintained in easily retrievable manner, preferably in electronic form. The provision should be made to recall the worker, as and when his or her check up is due. Pre-placement medical examination and proper documentation of records should be mandatory.

. A comprehensive document on environment, health and safety specific to coal based thermal power projects should be framed. It should cover the legal provisions, management system, best practices, safe operating procedures, etc. for various areas of thermal power plants. This will serve as a reference document for effective implementation of the provisions. . All CFTPPs should have environmental and occupational health and safety management systems in place, which are auditable by third party, approved by the Govt of India (Ministry of Power). Participatory management regarding health and safety at plant level may be ensured.

. The occupier of the CFTPP shall be responsible for the compliance of provisions of the Factories’ Act for casual/contractual labour on health and safety issues. In case of women workers, the provisions of the Factories’ Act, as applicable, shall be given attention.

13. Para 3.1.2 of the Report specifically refers to the occupational health and safety issues of workers in CFTPPs. The Report also refers to the hazards associated with (a) dust, (b) heat, (c) noise, (d) vibration,

(e) radiation, and (f) disposal of waste. After dealing with those health hazards, the Committee has stated that the hazards associated with inhalation of coal dust might result in development of dust related morbidity in the form of pneumoconiosis (coal workers pneumoconiosis, silicosis) and non-pneumoconiotic persistent respiratory morbidities, such as chronic bronchitis, emphysema, asthma, etc. Further, it also pointed out that whenever asbestos fibres are used for insulation and other purposes, the possibility of asbestosis among workers due to inhalation of asbestos fibres cannot be ruled out. The Report also says that other morbidities because of exposure to fly ash, including metallic constituents such as lead, arsenic, and mercury might also be present. Due to exposure to other chemicals used in different operations of CFTPP, the Report says, may also be responsible to adversely affect human health.

14. Report further says that occupational exposure to high heat in different thermal power plants may also cause heat related disorders, like heat exhaustion. Noise and vibration exposures in higher doses than the permissible limits may result in noise-induced hearing loss, raised blood pressure, regional vascular disorders, musculo-skeletal disorders, human error, productivity loss, accidents and injuries. Radiation hazards particularly from the generated fly ash and its used products have also been indicated of possible health risks. Different chemicals that are often being used in CFTPPs, such as chlorine, ammonia, fuel oil, and released in the working and community environment may be responsible for wide range of acute as well as chronic health impairments. Since large quantities of coal, other fuels and chemicals are stored and used in CFTPPs, the risks of fire and explosion are high, unless special care is taken in handling the materials. It may cause fire and explosion. Further, it may also be pointed out that in various work operations for manual materials handling, the workers are subjected to high degree of physical stress, with potential risks of musculo-skeletal disorders and injuries.

15. In para 3.1.5 the Report suggests certain protective measures for health and safety and also steps to be taken for emergency preparedness on spot/off-spot emergency plans and also the measures to be adopted for social welfare.

16. We may notice, the recommendations made are to be welcomed, but how far they are put into practice and what preventive actions are taken to protect the workers from the serious health-hazards associated with the work in CFTPPs calls for serious attention. Many workers employed in various CFTPPs are reported to be suffering from serious diseases referred to earlier. What are the steps taken by CFTPPs and the Union of India and the statutory authorities to protect them from serious health hazards and also the medical treatment extended to them, including compensation etc. calls for detailed examination.

17. We notice that CFTPPs are spread over various States in the country like Uttar Pradesh, Chhattisgarh, Maharashtra, Andhra Pradesh, and so on, and it would not be practicable for this Court to examine whether CFTPPs are complying with safety standards and the rules and regulations relating to the health of the employees working in various CFTPPs throughout the country. We feel that these aspects could be better examined by the respective High Courts in whose jurisdiction these power plants are situated. The High Court should examine whether there is adequate and effective health delivery system in place and whether there is any evaluation of occupational health status of the workers. The High Court should also examine whether any effective medical treatment is meted out to them.

18. We, therefore, feel that it is appropriate to relegate it to the various High Courts to examine these issues with the assistance of the State Governments after calling for necessary Reports from the CFTPPs situated in their respective States. For the said purpose, we are sending a copy of this Judgment to the Chief Secretaries of the respective States as well as Registrar Generals of the High Courts of the following States :

a) Uttar Pradesh

b) Chhattisgarh

c) Maharashtra

d) Andhra Pradesh

e) West Bengal

f) Madhya Pradesh

g) Bihar

h) Orissa

i) Haryana

j) Rajasthan

k) Punjab

l) Delhi/NCT Delhi

m) Gujarat

n) Karnataka

o) Kerala

p) Tamil Nadu

q) Jharkhand

r) Assam

19. Report of National Institute of Occupational Health (NIOH) titled Environment, Health and Safety Issues in Coal Fired Thermal Power Plants of the year 2011 may also be made available by the Secretary General of the Supreme Court to the Registrar Generals of the High Courts of the aforesaid States. We make it clear that the Report is not at all comprehensive in certain aspects and the respective High Courts can examine the issues projected in this Judgment independently after calling for the reports about the CFTPPs functioning in their respective States. The Registrar Generals of High Courts of the aforesaid States should place this Judgment before the Chief Justices of the respective States so as to initiate suo moto proceedings in the larger interest of the workers working in CFTPPs in the respective States.

20. The Writ Petition is accordingly disposed of.


Credit: Indian Kanoon

Perumal vs Janaki (1947) LIJR-SC

Perumal vs Janaki (1947)

LawGlobal-Hub Indian Judgment Report – Supreme Court

Chelameswar, J.

1. Leave granted.

2. Aggrieved by an order in Crl. R.C. No.1119 of 2011 of the High Court of Madras, the unsuccessful petitioner therein preferred the instant appeal.

3. A petition in C.M.P. No.4561 of 2010 (private complaint) under section 200 of the Code of Criminal Procedure, 1973 (hereinafter for short referred to as “the Cr.P.C.”) filed by the appellant herein against the respondent came to be dismissed by the Judicial Magistrate No.2 at Pollachi by his judgment dated 31st August 2010. Challenging the same, the abovementioned Crl. R.C. was filed.

4. The factual background of the case is as follows:

5. The respondent was working as a Sub-Inspector in an All-Women Police Station, Pollachi at the relevant point of time. On 18th May 2008, one Nagal reported to the respondent that the appellant herein had cheated her. The respondent registered Crime No.18/08 under sections 417 and 506(i) of the Indian Penal Code (hereinafter for short referred to as “the IPC”). Eventually, the respondent filed a charge-sheet, the relevant portion of which reads as follows:

“On 26.12.07, that the accused called upon the de-facto complainant for an outing and while going in the night at around 10.00 via Vadugapalayam Ittori route the accused enticed the de-facto complainant of marrying her and had sexual interaction several times in the nearby jungle and on account of which the complainant became pregnant and when she asked the accused to marry him he threatened the complainant of killing her if she disclosed the above fact to anybody.

Hence the accused committed an offence punishable u/s. 417, 506 (i) of IPC.” [emphasis supplied]

6. The appellant was tried for the offences mentioned above by the learned Judicial Magistrate No.1, Pollachi. The learned Judicial Magistrate by his judgment dated 15th March 2010 acquitted the appellant of both the charges.

7. It appears that the said judgment has become final.

8. In the light of the acquittal, the appellant filed a complaint (C.M.P. No.4561 of 2010) under section 190 of the Cr.P.C. on the file of the Judicial Magistrate No.2 at Pollachi praying that the respondent be tried for an offence under section 193 of the IPC. The said complaint came to be dismissed by an order dated 31st August 2010 on the ground that in view of sections 195 and 340 of the Cr.P.C. the complaint of the appellant herein is not maintainable.

9. Aggrieved by the said dismissal, the appellant herein unsuccessfully carried the matter to the High Court. Hence the present appeal.

10. The case of the appellant herein in his complaint is that though Nagal alleged an offence of cheating against the appellant which led to the pregnancy of Nagal, such an offence was not proved against him. Upon the registration of Crime No.18/08, Nagal was subjected to medical examination. She was not found to be pregnant. Dr. Geetha, who examined Nagal, categorically opined that Nagal was not found to be pregnant on the date of examination which took place six days after the registration of the FIR. In spite of the definite medical opinion that Nagal was not pregnant, the respondent chose to file a charge-sheet with an allegation that Nagal became pregnant. Therefore, according to the appellant, the charge-sheet was filed with a deliberate false statement by the respondent herein. The appellant, therefore, prayed in his complaint as follows;

“It is, therefore, prayed that this Hon’ble Court may be pleased to take this complaint on file, try the accused U/s. 193 IPC for deliberately giving false evidence in the Court as against the complainant, and punish the accused and pass such further or other orders as this Hon’ble court deems fit and proper.”

11. The learned Magistrate dismissed the complaint on the ground that section 195 of the Cr.P.C. bars criminal courts to take cognizance of an offence under section 193 of the IPC except on the complaint in writing of that Court or an officer of that Court in relation to any proceeding in the Court where the offence under section 193 is said to have been committed and a private complaint such as the one on hand is not maintainable.

12. The High Court declined to interfere with the matter in exercise of its revisional jurisdiction. The operative portion of the order under challenge reads as follows:

“3. … This court is in agreement with the conclusion of the court below in dismissing the complaint. The complaint provided very little to take action upon, particularly, where this court finds that the respondent had not in any manner tampered with the medical record so as to mulct the petitioner with criminal liability. The wording in the final report informing of the de facto complainant having been pregnant can in the facts and circumstances of the case, be seen only as a mistake.

4. In the result, the criminal revision stands dismissed.”

13. We regret to place on record that at every stage of this matter the inquiry was misdirected.

14. The facts relevant for the issue on hand are that:-

(1) The appellant was prosecuted for the offences under sections 417 and 506 (i) IPC. (The factual allegations forming the basis of such a prosecution are already noted earlier).

(2) The respondent filed a charge-sheet with an assertion that the appellant was responsible for pregnancy of Nagal.

(3) Even before the filing of the charge-sheet, a definite medical opinion was available to the respondent (secured during the course of the investigation of the offence alleged against the appellant) to the effect that Nagal was not pregnant.

(4) Still the respondent chose to assert in the charge-sheet that Nagal was pregnant.

(5) The prosecution against the appellant ended in acquittal.

15. The abovementioned indisputable facts, in our opinion, prima facie may not constitute an offence under section 193 IPC but may constitute an offence under section 211 IPC. We say prima facie only for the reason this aspect has not been examined at any stage in the case nor any submission is made before us on either side but we cannot help taking notice of the basic facts and the legal position.

16. The offence under section 193[1] IPC is an act of giving false evidence or fabricating false evidence in a judicial proceeding. The act of giving false evidence is defined under section 191 IPC as follows:

“191. Giving false evidence.— Whoever, being legally bound by an oath or by an express provision of law to state the truth, or being bound by law to make a declaration upon any subject, makes any statement which is false, and which he either knows or believes to be false or does not believe to be true, is said to give false evidence.

Explanation 1.—A statement is within the meaning of this section, whether it is made verbally or otherwise.

Explanation 2.—A false statement as to the belief of the person attesting is within the meaning of this section, and a person may be guilty of giving false evidence by stating that he believes a thing which he does not believe, as well as by stating that he knows a thing which he does not know.” It can be seen from the definition that to constitute an act of giving false evidence, a person must make a statement which is either false to the knowledge or belief of the maker or which the maker does not believe to be true. Further, it requires that such a statement is made by a person (1) who is legally bound by an oath; (2) by an express provision of law to state the truth; or (3) being bound by law to make a declaration upon any subject.

17. A police officer filing a charge-sheet does not make any statement on oath nor is bound by any express provision of law to state the truth though in our opinion being a public servant is obliged to act in good faith. Whether the statement made by the police officer in a charge-sheet amounts to a declaration upon any subject within the meaning of the clause “being bound by law to make a declaration upon any subject” occurring under section 191 of the IPC is a question which requires further examination.

18. On the other hand, section 211 of the IPC deals with an offence of instituting or causing to be instituted any criminal proceeding or falsely charging any person of having committed an offence even when there is no just or lawful ground for such proceeding to the knowledge of the person instituting or causing the institution of the criminal proceedings.

19. Irrespective of the fact whether the offence disclosed by the complaint of the appellant herein is an offence falling either under section 193 or 211 of the IPCsection 195 of the Cr.P.C. declares that no Court shall take cognizance of either of the abovementioned two offences except in the manner specified under section 195 of the Cr.P.C.:

“195. Prosecution for contempt of lawful authority of public servants, for offences against public justice and for offences relating to documents given in evidence.—(1) No Court shall take cognizance— x x x x x

(b) (i) of any offence punishable under any of the following sections of the Indian Penal Code (45 of 1860), namely, sections 193 to 196 (both inclusive), 199, 200, 205 to 211 (both inclusive) and 228, when such offence is alleged to have been committed in, or in relation to, any proceeding in any Court, or except on the complaint in writing of that Court or by such officer of the Court as that Court may authorise in writing in this behalf, or of some other Court to which that court is subordinate.”

20. In the light of the language of section 195 Cr.P.C. we do not find fault with the conclusion of the learned Magistrate in dismissing the complaint of the appellant herein for the reason that the complaint is not filed by the person contemplated under section 195 Cr.P.C. It may be mentioned here that as a matter of fact the Court before which the instant complaint was lodged is not the same Court before which the appellant herein was prosecuted by the respondent.

21. Under section 340(1) of the Cr.P.C., it is stipulated that whenever it appears that any one of the offences mentioned in clause (b) of sub- section (1) of section 195 appears to have been committed in or in relation to a proceeding before a Court, that Court either on an application made to it or otherwise make a complaint thereof in writing to the competent Magistrate after following the procedure mentioned under section 340 of the Cr.P.C.[2]

22. Admittedly, the appellant herein did not make an application to the judicial magistrate No.1, Pollachi under section 340 to ‘make a complaint’ against the respondent herein nor the said magistrate suo moto made a complaint. Therefore, the learned judicial magistrate No.2 before whom the private complaint is made by the appellant had no option but to dismiss the complaint.

23. But the High Court, in our view, is not justified in confining itself to the examination of the correctness of the order of the magistrate dismissing the said private complaint. Both Section 195(1) and Section 340(2) Cr.P.C. authorise the exercise of the power conferred under Section 195(1) by any other court to which the court in respect of which the offence is committed is subordinate to. (hereinafter referred to for the sake of convenience as ‘the original court’)

24. It can be seen from the language of Section 195(4)Cr.P.C. that it creates a legal fiction whereby it is declared that the original court is subordinate to that court to which appeals ordinarily lie from the judgments or orders of the original court. (hereinafter referred to as ‘the appellate court’) In our view, such a fiction must be understood in the context of Article 227[3] of the Constitution of India and Section 10(1) and 15(1) of Cr.P.C[4]. Article 227 confers the power of superintendence on a High Court over all courts and tribunals functioning within the territories in relation to which a High Court exercises jurisdiction. Section 10(1) and 15(1) of Cr.P.C. declare that the Assistant Sessions Judges and Chief Judicial Magistrates are subordinate to the Session Judge and other Judicial Magistrates to be subordinate to the Chief Judicial Magistrate subject to the control of the Session Judge. It may be remembered that Section 195(4) deals with the authority of the superior courts in the context of taking cognizance of various offences mentioned in Section 195(1). Such offences are relatable to civil, criminal and revenue courts etc.[5] Each one of the streams of these courts may have their administrative hierarchy depending upon under the law by which such courts are brought into existence. It is also well known that certain courts have appellate jurisdiction while certain courts only have original jurisdiction. Appellate jurisdiction is the creature of statute and depending upon the scheme of a particular statute, the forum of appeal varies. Generally, the appellate for a are created on the basis of either subject matter of dispute or economic implications or nature of crime etc.

25. Therefore, all that sub-section (4) of Section 195 says is that irrespective of the fact whether a particular court is subordinate to another court in the hierarchy of judicial administration, for the purpose of exercise of powers under Section 195(1), every appellate court competent to entertain the appeals either from decrees or sentence passed by the original court is treated to be a court concurrently competent to exercise the jurisdiction under Section 195(1). High Courts being constitutional courts invested with the powers of superintendence over all courts within the territory over which the High Court exercises its jurisdiction, in our view, is certainly a Court which can exercise the jurisdiction under Section 195(1). In the absence of any specific constitutional limitation of prescription on the exercise of such powers, the High Courts may exercise such power either on an application made to it or suo moto whenever the interests of justice demand.

26. The High Courts not only have the authority to exercise such jurisdiction but also an obligation to exercise such power in appropriate cases. Such obligation, in our opinion, flows from two factors – (1) the embargo created by Section 195 restricting the liberty of aggrieved persons to initiate criminal proceedings with respect to offences prescribed under Section 195; (2) such offences pertain to either the contempt of lawful authorities of public servants or offences against public justice.

27. A constitution Bench of this Court in Iqbal Singh Marwah & Anr. v. Meenakshi Marwah & Anr., (2005) 4 SCC 370, while interpreting Section 195 Cr.P.C., although in a different context, held that any interpretation which leads to a situation where a victim of crime is rendered remediless, has to be discarded[6]. The power of superintendence like any other power impliedly carries an obligation to exercise powers in an appropriate case to maintain the majesty of the judicial process and the purity of the legal system. Such an obligation becomes more profound when these allegations of commission of offences pertain to public justice.

28. In the case on hand, when the appellant alleges that he had been prosecuted on the basis of a palpably false statement coupled with the further allegation in his complaint that the respondent did so for extraneous considerations, we are of the opinion that it is an appropriate case where the High Court ought to have exercised the jurisdiction under Section 195 Cr.P.C.. The allegation such as the one made by the complainant against the respondent is not uncommon. As was pointed earlier by this Court in a different context “there is no rule of law that common sense should be put in cold storage”[7]. Our Constitution is designed on the theory of checks and balances. A theory which is the product of the belief that all power corrupts – such belief is based on experience.

29. The appeal is, therefore, allowed. The matter is remitted to the High Court for further appropriate course of action to initiate proceedings against the respondent on the basis of the complaint of the appellant in accordance with law.

………………………………………..CJI (P. Sathasivam) …………………………………..……J.

(J. Chelameswar) New Delhi;

January 20, 2014.

———————–

[1] Section 193. Punishment for false evidence.—Whoever intentionally gives false evidence in any stage of a judicial proceeding, or fabricates false evidence for the purpose of being used in any stage of a judicial proceeding, shall be punished with imprisonment of either description for a term which may extended to seven years, and shall also be liable to fine, and whoever intentionally gives or fabricates false evidence in any other case, shall be punished with imprisonment of either description for a term which may extended to three years, and shall also be liable to fine.

Explanation 1.—A trial before a Court-martial; is a judicial proceeding.

Explanation 2.—An investigation directed by law preliminary to a proceeding before a Court of Justice, is a stage of a judicial proceeding, though that investigation may not take place before a Court of Justice. [2] Section 340. Procedure in cases mentioned in section 195.—(1) When upon an application made to it in this behalf or otherwise, any Court is of opinion that it is expedient in the interests of justice that an inquiry should be made into any offence referred to in clause (b) of sub-section (1) of section 195, which appears to have been committed in or in relation to a proceeding in that Court or, as the case may be, in respect of a document produced or given in evidence in a proceeding in that court, such Court may, after such preliminary inquiry, if any, as it thinks necessary,-

(a) record a finding to that effect;

(b) make a complaint thereof in writing;

(c) send it to a Magi?


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Nandlal Wasudeo Badwaik vs Lata Nandlal Badwaik & Anr (1947) LIJR-SC

Nandlal Wasudeo Badwaik vs Lata Nandlal Badwaik & Anr (1947)

LawGlobal-Hub Indian Judgment Report – Supreme Court

CHANDRAMAULI KR. PRASAD, J.

Petitioner happens to be the husband of respondent no. 1, Lata Nandlal Badwaik and alleged to be the father of girl child Netra alias Neha Nandlal Badwaik, respondent no. 2, herein. The marriage between them was solemnized on 30th of June, 1990 at Chandrapur. Wife filed an application for maintenance under Section 125 of the Code of Criminal Procedure, but the same was dismissed by the learned Magistrate by order dated 10th December, 1993. Thereafter, the wife resorted to a fresh proceeding under Section 125 of the Code of Criminal Procedure (hereinafter referred to as the ‘Code’) claiming maintenance for herself and her daughter, inter alia, alleging that she started living with her husband from 20th of June, 1996 and stayed with him for about two years and during that period got pregnant. She was sent for delivery at her parents’ place where she gave birth to a girl child, the respondent no. 2 herein. Petitioner-husband resisted the claim and alleged that the assertion of the wife that she stayed with him since 20th of June, 1996 is false. He denied that respondent no. 2 is his daughter. After 1991, according to the husband, he had no physical relationship with his wife. The learned Magistrate accepted the plea of the wife and granted maintenance at the rate of Rs.900/- per month to the wife and at the rate of Rs.500/- per month to the daughter. The challenge to the said order in revision has failed so also a petition under Section 482 of the Code, challenging those orders.

It is against these orders, the petitioner has preferred this special leave petition.

Leave granted.

Taking note of the challenge to the paternity of the child, this Court by order dated 10th of January, 2011 passed the following order:

“…………However, the petitioner-husband had challenged the paternity of the child and had claimed that no maintenance ought to have been awarded to the child. The petitioner had also applied for referring the child for DNA test, which was refused. It is against the said order of refusal that the present Special Leave was filed and the same prayer for conducting the DNA test was made before us. On 8th November, 2010 we had accordingly, directed the petitioner-husband to deposit all dues, both arrear and current, in respect of the maintenance awarded to the wife and child to enable us to consider the prayer for holding of such DNA test. Such deposit having been made on 3rd January, 2011, we had agreed to allow the petitioner’s prayer for conducting DNA test for ascertaining the paternity of the child.

We have since been informed by counsel for the parties that a Forensic Science Laboratory in Nagpur conducts the very same test, as has been asked for, by the Petitioner. Accordingly, we direct the petitioner-Nandlal Wasudeo Badwaik and the respondent No. 1-Ms. Lata Nandlal Badwaik to make a joint application to the Forensic Science Laboratory, Nagpur, situated at Jail Road, Dhantoli, for conducting such test. The petitioner, as well as the respondent No. 1, shall present themselves at the Laboratory with respondent No. 2 for the said purpose on the date to be fixed by the laboratory, and, thereafter, the laboratory is directed to send the result of such test to this Court within four weeks thereafter. The expenses for the test to be conducted shall be borne by the petitioner-husband.” In the light of the aforesaid order, the Regional Forensic Science Laboratory, Nagpur has submitted the result of DNA testing and opined that appellant “Nandlal Vasudev Badwaik is excluded to be the biological father of Netra alias Neha Nandlal Badwaik”, respondent no. 2 herein.

Respondents, not being satisfied with the aforesaid report, made a request for re-test. The said prayer of the respondents was accepted and this Court by order dated 22nd of July, 2011 gave the following direction:

“Despite the fact that the report of the DNA Test conducted at the Regional Forensic Science Laboratory, State of Maharashtra, Nagpur-12, indicates that the petitioner is not the biological father of the respondent No. 2, on the prayer made on behalf of the respondents for a re-test, we are of the view that such a prayer may be allowed having regard to the serious consequences of the Report which has been filed.

Accordingly, we direct that a further DNA Test be conducted at the Central Forensic Laboratory, Ministry of Home Affairs, Government of India at Hyderabad and for the said purpose the parties are directed to appear before the Laboratory on 24th August, 2011 at 11.00 a.m.” As directed, the Central Forensic Science Laboratory, Hyderabad submitted its report and on that basis opined that the appellant, “Nandlal Wasudeo Badwaik can be excluded from being the biological father of Miss Neha Nandlal Badwaik”, respondent no. 2 herein.

At the outset, Mr. Manish Pitale appearing for the respondents submits that the appellant having failed to establish that he had no access to his wife at any time when she could have begotten respondent no. 2, the direction for DNA test ought not to have been given. In view of the aforesaid he submits that the result of such a test is fit to be ignored. In support of the submission he has placed reliance on a judgment of this Court in Goutam Kundu v. State of W.B., (1993) 3 SCC 418, relevant portions whereof read as under:

“24. This section requires the party disputing the paternity to prove non-access in order to dispel the presumption. “Access” and “non-access” mean the existence or non-existence of opportunities for sexual intercourse; it does not mean actual “cohabitation”.

26. From the above discussion it emerges— (1) That courts in India cannot order blood test as a matter of course;

(2) wherever applications are made for such prayers in order to have roving inquiry, the prayer for blood test cannot be entertained.

(3) there must be a strong prima facie case in that the husband must establish non-access in order to dispel the presumption arising under Section 112 of the Evidence Act.

(4) the court must carefully examine as to what would be the consequence of ordering the blood test; whether it will have the effect of branding a child as a bastard and the mother as an unchaste woman.

(5) no one can be compelled to give sample of blood for analysis.

27. Examined in the light of the above, we find no difficulty in upholding the impugned order of the High Court, confirming the order of the Additional Chief Judicial Magistrate, Alipore in rejecting the application for blood test…………….” Yet another decision on which reliance has been placed is the decision of this Court in the case of Banarsi Dass v. Teeku Dutta, (2005) 4 SCC 449, paragraph 13, which is relevant for the purpose is quoted below:

“13. We may remember that Section 112 of the Evidence Act was enacted at a time when the modern scientific advancements with deoxyribonucleic acid (DNA) as well as ribonucleic acid (RNA) tests were not even in contemplation of the legislature. The result of a genuine DNA test is said to be scientifically accurate. But even that is not enough to escape from the conclusiveness of Section 112 of the Evidence Act e.g. if a husband and wife were living together during the time of conception but the DNA test revealed that the child was not born to the husband, the conclusiveness in law would remain irrebuttable. This may look hard from the point of view of the husband who would be compelled to bear the fatherhood of a child of which he may be innocent. But even in such a case the law leans in favour of the innocent child from being bastardised if his mother and her spouse were living together during the time of conception. Hence the question regarding the degree of proof of non-access for rebutting the conclusiveness must be answered in the light of what is meant by access or non-access as delineated above. (See Kamti Devi v. Poshi Ram, 2001 (5) SCC 311.)” Reliance has also been placed on a decision of this Court in the case of Bhabani Prasad Jena v. Orissa State Commission for Women, (2010) 8 SCC 633, in which it has been held as follows:

“22. In our view, when there is apparent conflict between the right to privacy of a person not to submit himself forcibly to medical examination and duty of the court to reach the truth, the court must exercise its discretion only after balancing the interests of the parties and on due consideration whether for a just decision in the matter, DNA test is eminently needed. DNA test in a matter relating to paternity of a child should not be directed by the court as a matter of course or in a routine manner, whenever such a request is made. The court has to consider diverse aspects including presumption under Section 112 of the Evidence Act; pros and cons of such order and the test of “eminent need” whether it is not possible for the court to reach the truth without use of such test.” Miss Anagha S. Desai appearing on behalf of the appellant submits that this Court twice ordered for DNA test and, hence, the question as to whether this was a fit case in which DNA profiling should or should not have been ordered is academic. We find substance in the submission of Ms. Desai. Fact of the matter is that this Court not only once, but twice gave directions for DNA test. The respondents, in fact, had not opposed the prayer of DNA test when such a prayer was being considered. It is only after the reports of the DNA test had been received, which was adverse to the respondents, that they are challenging it on the ground that such a test ought not to have been directed. We cannot go into the validity of the orders passed by a coordinate Bench of this Court at this stage. It has attained finality. Hence, we do not find any merit in the submission of the learned counsel for the respondents. As regards the decision of this Court in the cases of Goutam Kundu (supra), Banarsi Dass (supra) and Bhabani Prasad Jena (supra), the same have no bearing in the facts and circumstances of the case. In all these cases, the court was considering as to whether facts of those cases justify passing of an order for DNA test. When the order for DNA test has already been passed, at this stage, we are not concerned with this issue and we have to proceed on an assumption that a valid direction for DNA test was given.

Ms. Desai submits that in view of the opinions, based on DNA profiling that appellant is not the biological father, he cannot be fastened with the liability to pay maintenance to the girl-child born to the wife. Mr. Pitale, however, submits that the marriage between the parties has not been dissolved, and the birth of the child having taken place during the subsistence of a valid marriage and the husband having access to the wife, conclusively prove that the girl-child is the legitimate daughter of the appellant. According to him, the DNA test cannot rebut the conclusive presumption envisaged under Section 112 of the Evidence Act. According to him, respondent no. 2, therefore, has to be held to be the appellant’s legitimate daughter. In support of the submission, reliance has been placed on a decision of this Court in the case of Kamti Devi v. Poshi Ram, (2001) 5 SCC 311, and reference has been made to paragraph 10 of the judgment, which reads as follows:

“10. ………The result of a genuine DNA test is said to be scientifically accurate. But even that is not enough to escape from the conclusiveness of Section 112 of the Act e.g. if a husband and wife were living together during the time of conception but the DNA test revealed that the child was not born to the husband, the conclusiveness in law would remain irrebuttable. This may look hard from the point of view of the husband who would be compelled to bear the fatherhood of a child of which he may be innocent. But even in such a case the law leans in favour of the innocent child from being bastardised if his mother and her spouse were living together during the time of conception……….” Before we proceed to consider the rival submissions, we deem it necessary to understand what exactly DNA test is and ultimately its accuracy. All living beings are composed of cells which are the smallest and basic unit of life. An average human body has trillion of cells of different sizes. DNA (Deoxyribonucleic Acid), which is found in the chromosomes of the cells of living beings, is the blueprint of an individual. Human cells contain 46 chromosomes and those 46 chromosomes contain a total of six billion base pair in 46 duplex threads of DNA. DNA consists of four nitrogenous bases – adenine, thymine, cytosine, guanine and phosphoric acid arranged in a regular structure. When two unrelated people possessing the same DNA pattern have been compared, the chances of complete similarity are 1 in 30 billion to 300 billion. Given that the Earth’s population is about 5 billion, this test shall have accurate result. It has been recognized by this Court in the case of Kamti Devi (supra) that the result of a genuine DNA test is scientifically accurate.

It is nobody’s case that the result of the DNA test is not genuine and, therefore, we have to proceed on an assumption that the result of the DNA test is accurate. The DNA test reports show that the appellant is not the biological father of the girl-child.

Now we have to consider as to whether the DNA test would be sufficient to hold that the appellant is not the biological father of respondent no. 2, in the face of what has been provided under Section 112 of the Evidence Act, which reads as follows:“112. Birth during marriage, conclusive proof of legitimacy.-

The fact that any person was born during the continuance of a valid marriage between his mother and any man, or within two hundred and eighty days after its dissolution, the mother remaining unmarried, shall be conclusive proof that he is the legitimate son of that man, unless it can be shown that the parties to the marriage had no access to each other at any time when he could have been begotten.” From a plain reading of the aforesaid, it is evident that a child born during the continuance of a valid marriage shall be a conclusive proof that the child is a legitimate child of the man to whom the lady giving birth is married. The provision makes the legitimacy of the child to be a conclusive proof, if the conditions aforesaid are satisfied. It can be denied only if it is shown that the parties to the marriage have no access to each other at any time when the child could have been begotten. Here, in the present case, the wife had pleaded that the husband had access to her and, in fact, the child was born in the said wedlock, but the husband had specifically pleaded that after his wife left the matrimonial home, she did not return and thereafter, he had no access to her. The wife has admitted that she had left the matrimonial home but again joined her husband. Unfortunately, none of the courts below have given any finding with regard to this plea of the husband that he had or had not any access to his wife at the time when the child could have been begotten.

As stated earlier, the DNA test is an accurate test and on that basis it is clear that the appellant is not the biological father of the girl- child. However, at the same time, the condition precedent for invocation of Section 112 of the Evidence Act has been established and no finding with regard to the plea of the husband that he had no access to his wife at the time when the child could have been begotten has been recorded. Admittedly, the child has been born during the continuance of a valid marriage. Therefore, the provisions of Section 112 of the Evidence Act conclusively prove that respondent No. 2 is the daughter of the appellant. At the same time, the DNA test reports, based on scientific analysis, in no uncertain terms suggest that the appellant is not the biological father. In such circumstance, which would give way to the other is a complex question posed before us.

We may remember that Section 112 of the Evidence Act was enacted at a time when the modern scientific advancement and DNA test were not even in contemplation of the Legislature. The result of DNA test is said to be scientifically accurate. Although Section 112 raises a presumption of conclusive proof on satisfaction of the conditions enumerated therein but the same is rebuttable. The presumption may afford legitimate means of arriving at an affirmative legal conclusion. While the truth or fact is known, in our opinion, there is no need or room for any presumption. Where there is evidence to the contrary, the presumption is rebuttable and must yield to proof. Interest of justice is best served by ascertaining the truth and the court should be furnished with the best available science and may not be left to bank upon presumptions, unless science has no answer to the facts in issue. In our opinion, when there is a conflict between a conclusive proof envisaged under law and a proof based on scientific advancement accepted by the world community to be correct, the latter must prevail over the former.

We must understand the distinction between a legal fiction and the presumption of a fact. Legal fiction assumes existence of a fact which may not really exist. However presumption of a fact depends on satisfaction of certain circumstances. Those circumstances logically would lead to the fact sought to be presumed. Section 112 of the Evidence Act does not create a legal fiction but provides for presumption.

The husband’s plea that he had no access to the wife when the child was begotten stands proved by the DNA test report and in the face of it, we cannot compel the appellant to bear the fatherhood of a child, when the scientific reports prove to the contrary. We are conscious that an innocent child may not be bastardized as the marriage between her mother and father was subsisting at the time of her birth, but in view of the DNA test reports and what we have observed above, we cannot forestall the consequence. It is denying the truth. “Truth must triumph” is the hallmark of justice.

As regards the authority of this Court in the case of Kamti Devi (Supra), this Court on appreciation of evidence came to the conclusion that the husband had no opportunity whatsoever to have liaison with the wife. There was no DNA test held in the case. In the said background i.e. non- access of the husband with the wife, this Court held that the result of DNA test “is not enough to escape from the conclusiveness of Section 112 of the Act”. The judgment has to be understood in the factual scenario of the said case. The said judgment has not held that DNA test is to be ignored. In fact, this Court has taken note of the fact that DNA test is scientifically accurate. We hasten to add that in none of the cases referred to above, this Court was confronted with a situation in which DNA test report, in fact, was available and was in conflict with the presumption of conclusive proof of legitimacy of the child under Section 112 of the Evidence Act. In view of what we have observed above, these judgments in no way advance the case of the respondents.

In the result, we allow this appeal, set aside the impugned judgment so far as it directs payment of maintenance to respondent no. 2. However, we direct that the payments already made shall not be recovered from the respondents.


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