Rise in claims unlikely after man wins settlement against publicans
There is unlikely to be a rash of claims arising out of the settlement of the case in Cork in which a man sued two publicans for allowing him to have too much to drink and drive his van.
On Tuesday Mr Denis Murphy, a Co Cork farmer, was paid an ex gratia sum thought to be in excess of £100,000 by a hotelier and a publican. He had crashed his van into a wall, resulting in his paralysis from the neck down, after consuming large quantities of drink in a public house and a hotel. He claimed the owners were negligent in serving him so much and allowing him to drive while drunk.
Both legal and insurance industry sources are confident that, because this was settled out of court and because of the specifics of the case, it will not prompt similar claims.
A Cork solicitor, Mr Kieran O'Callaghan, pointed out that there had been no judgment in court and therefore no legal precedent had been set. "There were also facts in this case that are unlikely to be repeated in another case," he said.
One of the publicans concerned drove the claimant back to his van after he had drunk a large amount.
"It could strengthen the hands of publicans who want to refuse drink to a person they think has already had too much," he said.
Unless there were unusual features attached to the case it was unlikely to succeed, he said, because the claimant had committed a criminal offence by driving while drunk, and should have been aware of the sanctions for doing so.
"It's common for insurance companies to pay 10-20 per cent of the full value of a claim for its `nuisance value'. What they are buying off are two things: the slight chance that he would win entirely the full value of the claim, which would be about £1 million, and also the chances of the case going on a long time with huge costs, which they might have to bear themselves.
"It was a commercial risk decision. Because there were two premises involved there were probably two insurance companies. The insurers have not done badly out of it. It will have cost them about £50,000 apiece. It would have cost that amount if it had gone to court. Buying off a doubtful claim is an everyday occurrence in the corridors.
"From a legal point of view it is interesting, and it will be used in bargaining in the corridors, but it does not set a precedent."
A spokeswoman for the Irish Insurance Federation said it was impossible to say yet whether the case would give rise to an increase in premiums for publicans' public liability insurance.
"It depends on whether there are more claims, and whether they succeed," she said. "If there is an increase in claim costs, premiums will follow them. We can't say yet whether this is a trend or an aberration. It would be quite hard to decide whether a legal liability has been established."
She pointed out that there had been no judgment in court against the publicans. "People settle a lot," she said.
"There is no one company identified with the licensed trade," she added. "Publicans are insured on an individual basis by individual insurance companies, covering both commercial property and public liability."
The size of the premium is negotiated on an individual basis and is determined by a number of factors, not primarily location and size of premises, she said. "A large public house might have more safety features in place."
The Licensed Vintners' Association was equally unalarmed. "It is not a precedent because it was an out-of-court settlement," said a spokeswoman. "There is no guarantee another similar case would succeed."