Insurers in need of a sporting chance

While politics largely ignored sport amid the recent electioneering, the legal profession was caused pay close attention. March saw the widely reported Australian decision of McCracken v. Melbourne Storm, followed in May by the Court of Appeal's deliberations on insurance cover for professional sports players in Blackburn Rovers v. Avon.

The McCracken decision, which arose from a career-ending tackle in an Australian Rugby League game, emphasised that players must still operate within the rules. While the defendant's lawyer is quoted as saying: "This should send a shudder down the spines of administrators in any body-contact sports and the insurance companies that insure them", it must be remembered that both players had pleaded guilty to using a "dangerous throw when effecting a tackle" in disciplinary proceedings following the incident.

The offending players' club was vicariously liable for their actions, although this point does not appear from the judgment to have been expressly argued. This shows that sporting clubs, as employers, could well be liable for the deliberate action of their players.

At issue for the Court of Appeal in Blackburn Rovers v. Avon was the interpretation of an exclusion clause of a sports-injury policy. The clause sought to exclude liability for an injury resulting in "permanent total disablement" attributable either directly or indirectly to "arthritic or other degenerative conditions". The trial judge held that this meant conditions of sufficient severity to be regarded as an illness, as opposed to conditions forming part of the normal ageing process.

The Court of Appeal disagreed, concluding that insurers could exclude cover for an injury resulting in disablement caused by 'normal' degeneration. Overturning the first instance decision, it found that, although the judge had adopted the right approach to the construction of the policy and exclusion, he had disregarded causation.

These two cases, while dealing with different types of policies, highlight two significant points for brokers and insurers to check. First, in a liability policy, is there cover for the deliberate act of one player against another? Secondly, when drafting exclusion clauses in accident policies, have they been sufficiently clearly drafted to avoid judicial scrutiny?