Spire And RSA Contest Aggregation Again

• Published date: 02 February 2022
• Law Firm: Herbert Smith Freehills
• Author: Mr Alexander Oddy and Nikita Davé

In Spire Healthcare Limited v Royal & Sun Alliance Insurance Limited [2022] EWCA Civ 17, the Court of Appeal overturned the High Court's decision and held that two groups of claims based on the negligent practice of the same surgeon should be aggregated. Irrespective of which group the claims fell into, the unifying factor between them was the surgeon's dishonest improper conduct.

Background

The Claimant (Spire) claimed against the Defendant insurer (RSA) under a policy (the Policy) providing cover for liabilities arising from the acts and omissions of employees and those providing medical or surgical service at its hospitals.

The underlying claims arose from the much-publicised activities of Consultant breast surgeon, Ian Paterson, who was sentenced in 2017 for carrying out unnecessary surgery on patients between 2004 and 2011. A large number of claims were brought against Spire by former patients of Mr Paterson in respect of surgeries performed at two of its hospitals.

There were two groups of claimant patients. One group of patients had required surgery but Mr Paterson had performed sub-total mastectomies, a negligent procedure where some breast tissue was left behind (Group 1). The other group of patients were the victims of entirely unnecessary surgery (Group 2).

The relevant aggregation provision in the Policy provided as follows:

"The total amount payable by the Company in respect of all damages costs and expenses arising out of all claims during any Period of Insurance consequent on or attributable to one source or...