CL-2023-000064 - [2025] EWHC 1870 (Comm)

In relation to the meaning of “competent authority”, the Divisional Court in FCA v Arch held at [375] that the phrase “competent local authority” in a wording covering non-damage denial of access meant “whichever authority is competent to impose the relevant restrictions in the locality on the use of the premises, including central government”.

I was not convinced that this advanced the argument greatly. It is obvious that central government qualifies as an “authority” for the purposes of our clause. But the parties would perhaps disagree as to whether the BHA or the GBGB were “competent to impose the relevant restrictions in the locality on the use of the premises”. The U/Ws would, I think, say that the BHA could not “impose” a restriction.

In Midland Mainline v Eagle Star Insurance Co Ltd[2004] EWCA Civ 1042, it was common ground that the actions of Railtrack in imposing emergency speed restrictions after the Hatfield rail disaster in 2000 were the actions of a “competent authority” under a denial of access cover: see [15]. The Cs observed that Railtrack was at the relevant time a private company (privatisation was in 1996 and renationalisation was in 2002). The U/Ws argued that the source of Railtrack’s powers was statutory. Whether that is right or wrong, I was not greatly assisted by the fact that there had been agreement that Railtrack was a “competent authority”, since that agreement meant that there was no discussion in the case of the reason(s) why Railtrack qualified.

I was also shown some overseas cases. They did not assist me greatly either. For example, “competent public authority” was held by the New South Wales Supreme Court in Cat Media Ltd v Allianz Australia Insurance [2006] NSWSC 423 at [41]-[43] to mean the authority “with jurisdiction to deal with the specific events or occurrences”. But that case was really concerned with what the authority was competent to do. It was held that an authority with the power to suspend a license was not competent to close or evacuate the premises.

In relation to the ejusdem generis and noscitur a sociis principles, the Divisional Court in FCA v Arch (supra) had some useful general guidance to offer at [68]-[70]:

“68.

For instance, if a clause in an insurance policy covers, or excludes, the risk of damage to a number of items, it is likely that the words used denote things of the same genus (ejusdem generis), and each word can take its meaning from the words with which it is linked or surrounded (noscitur a sociis). In Watchorn v Langford (1813) 170 ER 1432, the insurance policy covered “stock in trade, household furniture, linen, wearing apparel and plate”. When the insured’s linen drapery goods were destroyed in a fi re, the House of Lords held that the policy did not respond because the reference to “linen” must have been to household linen or linen in clothing, rather than drapery.

69.

A more recent illustration can be seen in Tektrol Ltd v International Insurance Co of Hanover Ltd [2006] Lloyd’s Rep IR 38 where an insurance policy excluded liability for “erasure loss distortion or corruption of information on computer systems”. Sir Martin Nourse (agreeing with Buxton LJ) noted that “loss” in this context was a reference to loss by electronic means, rather than the burglary of a computer, citing the maxim noscitur a sociis (at para 29). That case also involved consideration of the meaning of “malicious person” within another exclusion containing the phrase “rioters strikers locked-out workers persons taking part in labour disturbances or civil commotion or malicious persons”. In that context, given the other categories of persons in the list, malicious person was held not to be a reference to a person who hacked in remotely to the computer systems in question (at paras 11 to 12).

70.

The principle of noscitur a sociis is, however, one which only operates if there can be said to be a common characteristic of the surrounding words, and it is a principle which must in any event give way if the particular words, or other features of the contract so dictate.”

I was referred to a further recent use of the rule in an insurance context: the decision of the Court of Appeal in Manchikalapati v Zurich Insurance plc [2020] Lloyd's Rep IR 77, [124]-[126]. In that case, it was confirmed that the clause “Any claim or contribution to a claim where cover is available under another insurance policy, or where some other form of compensation or damages is available to You” was not engaged just because a claim in damages could in principle have been made against a third party. They noted (at [126]) that “a single species and general words may constitute a genus”.

Of course, in order for the ejusdem generis principle to play a role, it is still necessary to identify some common genus or characteristic: see The Interpretation of Contracts (8^th Ed) at paragraph 7.144.