Following a recently well publicised event where the power to Gisborne was interrupted by a wire strike, many of our clients have asked if they are covered under their aviation policy for the consequential losses arising from proven negligence as a result of taking the powerlines down?
We posed this question to Mark Anderson, a partner with DAC Beachcroft Lawyers, and he has provided the following information.
Under the London Aircraft Insurance Policy wording AVN1C is in Section II; Legal Liability to Third Parties. The Coverage section 1 states that insurers will indemnify an operator for all sums that the operator is legally liable for accidental damage to property caused by the aircraft.
Save for necessitating that the conduct is accidental, the wording is broad to cover negligent acts or omissions that led to the accident and the policy has no exclusions relevant to the question about consequential losses or specifically power lines.
Mark references that:
Fletcher v Rylands ( LR 1 Ex 265 has a relevant maxim that “those who go personally or bring property where they know that they or it may come into collision with the persons or property of others have by law a duty cast upon them to use reasonable care and skill to avoid such a collision.”
Mark further advises that as long as the aircraft operator has caused the damage through a proven negligent act, and it is reasonably contemplated that the loss would have followed by that cause, then there will be a legal liability regardless of whether it is a direct loss or a consequential loss. If there is liability determined, there will be cover under the policy. Of course, if there has been an intervening cause (e.g.: powerline is struck, but an inadequate fuse box leads to a town’s power cut), or multiple causes (say a mid-air collision) then liability will be mitigated if not avoided altogether.
Our thanks to Mark for providing that information.