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IN THE SUPREME COURT OF JUDICATURE CCRTF 96/0122/C

(HIS HONOUR JUDGE MICHAEL QC )

Royal Courts of Justice

Strand

London WC2

Wednesday, 16 April 1997

B e f o r e:

LORD JUSTICE LEGGATT

LORD JUSTICE THORPE

LORD JUSTICE MUMMERY

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CHRISTOPHER DAVID SARGENT

PLAINTIFF/APPELLANT

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GRE (UK) LIMITED

DEFENDANT/RESPONDENT

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(Computer Aided Transcript of the Palantype Notes of

Smith Bernal Reporting Limited, 180 Fleet Street,

London EC4A 2HD

Tel: 0171 831 3183

Official Shorthand Writers to the Court)

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MR R COLBEY (Instructed by Messrs Bissmire Fudge & Co, Dyfed) appeared on behalf of the Appellant

MR A REDDIFORD (Instructed by Messrs Sansbury Hill, Avon) appeared on behalf of the Respondent

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J U D G M E N T

(As approved by the Court )

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©Crown Copyright

Wednesday, 16 April 1997

J U D G M E N T

LORD JUSTICE MUMMERY: This appeal concerns the construction of a personal accident insurance policy (no. W380/T8255481) taken out by the plaintiff, Mr Christopher Sargent, with the defendant, GRE (UK) Limited, on 16 May 1988 while he was serving as a Corporal in the Royal Corps of Transport.

He left the Forces in June 1991 at the age of 30. He then trained as a dry line jointer, a semi-skilled occupation in which he was employed when he was injured on the football field on 16 November 1991. His right and dominant index finger was so badly damaged that it had to be amputated on 30 September 1993. He is permanently disabled from continuing his occupation as a dry line jointer. That involves cutting and fixing plasterboards, which are then cemented to walls or nailed to partitions and ceilings. Mr Sargent is right-handed, and the right index finger is important in the use of a machine for levelling off jointing material. He can still do labouring work (so long as it is not too arduous) and he can drive heavy goods vehicles, which he has done.

The policy, which was in force at the time of the accident, provided that the benefits payable would include: (1) £750 for "permanent loss/loss of use of at least one phalanx of any finger"; and (2) £10,000 for "permanent total disablement from attending to any occupation".

Mr Sargent, who had notified the insurers that he had left the Forces, claimed that he was entitled to a claim of £10,000 for permanent total disablement, because he was no longer able to attend to his occupation as a dry line jointer. The insurers accepted that he was entitled to £750 for the loss of his finger, and that he could no longer continue with that occupation, but contended that there were other occupations open to him and that, as he was not permanently totally disabled from attending to those other occupations, he was not entitled to payment of £10,000.

On 5 September 1995, His Honour Judge Michael Evans QC, sitting in the Haverfordwest County Court, dismissed Mr Sargent's claim for £10,000. Mr Sargent appeals on the ground that the Judge misconstrued the policy. The Judge's reasoning was that:

"... the ordinary meaning of the clause is that the benefit is to be paid out in the event that the Plaintiff cannot carry on any occupation at all."

He rejected as "contrary to the object of the policy and as absurd" Mr Sargent's contention that permanent total disablement from attending to his occupation entitled him to £10,000 and that his ability to attend to other occupations was irrelevant to that payment under the policy. In the Judge's view, Mr Sargent's construction, taken to its logical conclusion:

"... would mean that the Plaintiff could still be a dry liner and get paid under the policy so long as he could identify an occupation that he could not perform."

In my judgment, it is not the particularly illuminating, and indeed it may be positively misleading, to adopt the dictionary approach to the question of construction by simply asking what the words " any occupation" mean. Similarly, it is of little assistance to look at decided cases on the meaning of "any" in the context of other contracts and deeds, or in different legislative contexts. I have not been able to derive any assistance on the construction of this policy from the decision cited by Mr Colbey on behalf of Mr Sargent, Re Janet Mary Fowles Deceased [1968] Queensland Law Reporter 109, or from Sherwood v. Cox [1945] 1 KB 549, a decision on the Food and Drugs Act 1938. At most, those decisions lay the basis for the submission that the expression "any occupation" in this policy is ambiguous. Further, it is not normally permissible in the process of interpretation to add words to the relevant part of the policy; for example, "any occupation at all "; or to substitute different words to achieve the desired result, depending on your point of view about the intentions of the parties; for example " every occupation" in place of " any occupation".

The insurer's drafting of the relevant provisions in this policy in unclear. Hence this dispute. The purely linguistic approach to construction has produced two conflicting positions, each of which may be legitimately commended by its proponent as literally sustainable, and stigmatised by its opponent as patently absurd. Thus, Mr Sargent argues for a construction which has the effect that, if there is any occupation which he is unable to carry on by reason of the injury, (for example, a concert pianist) he is entitled to £10,000; while the insurers argue that, if there is any occupation which he is able to carry on (for example, a heavy goods vehicle driver) he is not entitled to £10,000. Mr Reddiford for the insurers has not persuaded me, by reference to his authorities, notably Pocock v. Century Insurance Co Ltd [1960] 2 Lloyd's List Rep 150 at 154 (a decision on a significantly differently worded policy) that his construction of the policy does not produce absurd results.

In my judgment, a broader approach to the construction of a provision in a commercial document, such as this policy, is appropriate, embracing consideration of the policy as a whole, its context, scheme and the surrounding circumstances. That approach should help to bring into sharper focus the object and purpose of the provisions which lack linguistic clarity.

The policy is described as "HM Forces Insurance Plan", and the insurers are stated to be "leading insurers to HM Forces personnel". The policy is arranged in different parts: Definitions, Conditions, Special Provisions, General Exceptions and Sections A, B, C and D. Section C is the Personal Accident section. It contains a Table of Benefits with ten items which shortly describe the events on which sums are payable, and also specify the respective amounts payable to the insured, the insured's spouse or the insured's child, as the case may be. In considering the two items relevant to Mr Sargent's claim, items 6 and 7, it is important to keep in mind the fact that this policy was primarily tailored to fit members of Her Majesty's Forces, in which Mr Sargent was serving at the time. This explains item 6 which is in these terms:

"Permanent total disablement from following own or alternative occupation in HM Forces necessitating medical discharge from HM Forces ...... £10,000"

to the insured. The only other item for "permanent total disablement" is item 7 which reads:

"(Insured Person not a member of HM Forces) Permanent total disablement from attending to any occupation..."

That produces £10,000 for the insured, the insured's spouse or child. Mr Sargent can only claim under item 7 as he had ceased to be a member of HM Forces at the time of his injury. The important point for present purposes is that the Table of Benefits draws a distinction between an occupation in HM Forces and the occupation of a person who is not a member of HM Forces. Item 6 recognises that there are different occupations within the Forces -- your own or alternative occupations, which you may be required to do and be paid for and trained for within the Forces. £10,000 is payable to a member of HM Forces who is disabled from following his own or an alternative occupation in HM Forces, necessitating a medical discharge. £10,000 is payable, even though the insured is not, as Mr Reddiford accepts, permanently disabled from following any occupation outside HM Forces. Item 7 covers the case of permanent disability of an insured who is not a member of HM Forces. It draws no distinction between "own" or "alternative occupation". The insured, who is not a member of HM Forces, is entitled to payment of £10,000 if he is permanently disabled from attending to "any occupation". That is clearly a reference to any occupation outside HM Forces; a dry line jointer is such an occupation. By reason of his injury, Mr Sargent is permanently disabled from attending to it. There is no reference in item 7 to disability from following an alternative occupation; that is only relevant to the case of a member of HM Forces. Further, the potential width of the expression "any occupation", is circumscribed by its context and implicitly limited to any relevant occupation. The evident purpose of personal accident insurance against permanent disablement of a person, who is not in the special position of a member of HM Forces, is to provide for the event that he is permanently disabled from attending to his occupation as at the time of his disabling injury and not just to provide for the more drastic and remote event that he would not be able to attend to any occupation of any kind at all ever again.

In my judgment, Mr Sargent falls within item 7, as he is permanently disabled from attending to the occupation followed by him at the time of the disabling injury, occurring during the period of cover. It is not relevant to inquire under item 7 of the policy whether he is also disabled from attending to an alternative occupation. That line of inquiry is only relevant if the insured is a member of HM Forces and the claim is made under item 6. This is not such a claim.

I would therefore allow the appeal. It is common ground that this would entitle Mr Sargent to the payment of £10,000, but not to an additional payment of £750 under item 9 of the Table of Benefits.

LORD JUSTICE THORPE: I agree.

LORD JUSTICE LEGGATT: In my judgment, the words "any occupation" in this context bear the connotation that the policy holder is covered if he is permanently totally disabled from following any particular occupation or an occupation of whatever kind that he may happen to have been following at the date of his accident. If that were wrong, the phrase would be completely ambiguous because, at one extreme it would be contended that the policy holder could not recover if he was physically able to sell matches though nothing else, while at the other, he could recover if he was not physically able to be a concert pianist. In that event, the contra proferentes rule would apply and the insurers would still be liable. The appeal is therefore allowed.

ORDER: Appeal allowed with costs; legal aid taxation of the appellant's costs; leave to appeal to the House of Lords refused.