Court Of Appeal Reverses Decision Of High Court And Rules That Consequential Losses Are Recoverable Under The Riot (Damages) Act 1886
In Mitsui Sumitomo Insurance Co (Europe) Ltd and Anor v The Mayor's Office For Policing And Crime [2014] EWCA Civ 682, the Court of Appeal has handed down a landmark decision on the recoverability of consequential losses under s2(1) of the Riot (Damages) Act 1886 (the "Act"). In September last year, the High Court confirmed that the Act was not intended to cover anything other than physical damage to property. Therefore consequential losses were not recoverable (see our blog on this decision here). The claimants' cross-appeal was successful on the issue of damages as the Court of Appeal held that the judgment of the High Court erred in its interpretation of s.2(1) of the Act and consequential losses were recoverable by the insurers. It was held that on the plain wording of s.2(1) of the Act, nothing supports the proposition that the loss sustained cannot include consequential losses caused by the injury or destruction of the property. Looking at the historical and legal background to the Act, Lord Justice Moore-Bick stated that historically, those who suffered property damage as a result of riotous and tumultuous behavior would have been able to recover damages for all their loss. The rationale behind this approach is enshrined in previous case law. The Court has held that losses which are a necessary or immediate consequence of a riot are recoverable. A consequential loss, such as damage to furniture, is not distinct from damage to the property itself, and is therefore...
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