Contractors All Risks Insurance:  Any One Event (UK) – Part 3

In this judgment, discussed previously [here and here] the final issue for determination was the question of application of the insured’s Retained Liability. 

The relevant clause read:

“The policy deductible was €10 000 each and every loss, but there was a deductible for claims under D35 of €150 000 “any one event”. 

The net effect of all this was that a claim to repair property insured was subject to a per loss deductible of £10,000, but a claim for the cost of repairing property damaged by a design defect was £10,000, but a claim for the cost of repairing property damaged by a design defect was £150,000 any one event.  There was no definition of “event” as such, although there was a ”72 hour clause” under which “damage arising during any one period of seventy-two consecutive hours and caused by storm, tempest, flood, water damage, subsidence, collapse or earthquake shall be deemed to be a single event …”.

The question was whether there was a single event attracting just one aggregate deductible or whether, as contended by the insurers, the damage to each individual cassette was an event so that multiple deductibles applied.

The insured argued that the single proximate cause of the damage occurring during the period of insurance was the failure by the designers and contractors to specify the need for or provide temporary roofing or other effective waterproofing requirements. 

The questions was whether the design decisions were an event. 

The court said it was a question of fact in each case whether a decision could be an event.  In principle, it was possible for the decision not to adopt a temporary roof to be an event from which all losses arose.  The significant water ingress which occurred during construction was the result of the defects identified by the insureds.  Had a temporary roof been erected, the problem would not have arisen.  The decision to design the roof without incorporating the use of a temporary roof until permanent waterproofing had taken place was an event because it occurred at a particular time and place and was arrived at in a particular way which caused the damaged suffered.

Accordingly a single deductible was applicable. 

The judgment contains a useful collection analysis of the English law on “occurrence”” event” and “cause”.