The Court of Appeal has upheld an insurer’s refusal to deal with a personal injury claim after finding that a security company breached policy conditions requiring timely notification of an incident and the immediate forwarding of related legal documents.
What did the Court of Appeal decide?
In Daniel Makin v QBE Insurance (Europe) Limited and others [2026] EWCA Civ 1367, handed down on 27 October 2026, the Court of Appeal dismissed Mr Makin’s appeal against the High Court’s decision that QBE was not liable to him under Protec Security Group Limited’s public liability policy.
Lord Justice Stuart-Smith gave the leading judgment, with Lady Justice King and Lady Justice Cockerill agreeing. The court held that Protec breached Claims Condition 3.5 by failing to notify the relevant incident within the required period after its director acquired sufficient knowledge that it might lead to a claim. Protec also breached Claims Condition 2 by failing to forward relevant letters of claim to the insurer immediately.
The court concluded that the wording of the policy made both conditions conditions precedent to liability. Their breach therefore entitled QBE to refuse to deal with the claim. The appeal was dismissed.
What happened to Daniel Makin?
On 6 August 2017, Mr Makin was ejected from the Muse Bar and Restaurant in Oldham by two door supervisors engaged by Protec. During an altercation outside, one of the supervisors forced him to the ground and held him in a headlock. Mr Makin stood up and walked away, but he was found to have suffered a stroke two days later, leaving him with serious neurological difficulties.
Mr Makin brought proceedings against the restaurant and Protec, alleging that the actions of the door supervisor caused his injuries. The claim against the restaurant was later discontinued. In July 2023, after Protec had entered liquidation, a judge found that Mr Makin’s stroke and resulting injuries were caused by the assault and entered judgment against Protec, with damages to be assessed.
QBE, Protec’s public liability insurer, had not participated in that earlier preliminary issue and had declined cover under the policy. Mr Makin subsequently joined QBE to the proceedings, relying on the Third Parties (Rights Against Insurers) Act 2010. QBE argued that Protec’s failure to notify it promptly meant that it was entitled to refuse indemnity.
- Mr Makin is ejected from the restaurant and an altercation takes place outside.
- Mr Makin is found unwell at home and is later understood to have suffered a stroke.
- Solicitors send a letter of claim to the restaurant describing the alleged assault and serious injuries.
- The restaurant’s director forwards the claim correspondence to Protec and asks that it be passed to its insurer.
- Solicitors send a letter of claim directly to Protec.
- QBE first receives notice of the potential claim from Mr Makin’s solicitors.
- The High Court rules that QBE is not liable under the policy.
- The Court of Appeal dismisses Mr Makin’s appeal.
Why did notification matter?
The policy required the insured to notify Sutton Specialist Risks of certain incidents within 30 days. The Court of Appeal agreed that this obligation was triggered when Protec’s director, Elvin Lucas, acquired sufficient knowledge that the incident might give rise to a claim. That knowledge could be acquired after the incident itself, including through information received on his return from holiday, so long as it arose within the relevant 30-day period.
The court stressed that the policy did not impose a general duty on the insured to keep investigating or repeatedly reassessing an incident when there was initially no reason to think a claim might arise. But if the insured did acquire the necessary knowledge within the specified period, the notification obligation was triggered. The judge’s finding that Mr Lucas had acquired that knowledge within the period was one he was entitled to make.
The second notification issue concerned legal correspondence. In December 2019, Protec received an email forwarding a letter of claim originally sent to the restaurant. A further letter of claim was sent directly to Protec in June 2020. Neither was passed to QBE at the time. The Court of Appeal held that Claims Condition 2 required documents connected with an incident that might give rise to a policy claim to be forwarded unanswered immediately. Protec’s failure to do so breached that condition.
How were the policy conditions interpreted?
A central issue was whether the claims conditions could operate as conditions precedent even though the policy did not expressly label them that way. The court explained that this question depends on construing the policy as a whole. The fact that other parts of the same policy expressly used the words “condition precedent” did not prevent these notification provisions from having that effect.
“Breach of these conditions will entitle us to refuse to deal with the relevant claim.”
The policy wording considered by the Court of Appeal
The court rejected the argument that the phrase “will entitle us” created a contractual discretion that QBE could exercise only on rational grounds. The wording was not qualified, and there was no basis for implying a term that would restrict the insurer’s entitlement in the manner argued by Mr Makin.
Accordingly, Claims Conditions 2 and 3.5 were to be treated as conditions precedent. It was common ground that, on that basis, QBE did not have to show that the breaches had caused it prejudice before refusing indemnity.
The judgment also considered the Third Parties (Rights Against Insurers) Act 2010. The court accepted that the earlier judgment against Protec had not established the amount of Mr Makin’s liability, because damages had not yet been assessed. The court declined to determine a wider issue about whether a judgment against an insured can bind an insurer under section 1 of the 2010 Act, leaving that question for a case in which it must be decided.
What does the judgment mean?
The decision highlights the importance of reading notification provisions carefully and complying with them promptly. Businesses insured under liability policies should ensure that incidents potentially involving injury or allegations against staff are reported in accordance with the policy, and that letters of claim, court documents and related correspondence are sent to the insurer or its nominated representative without delay.
It also demonstrates that a notification duty may be triggered by knowledge acquired after an incident, rather than only by what the insured knew at the precise moment it occurred. The time limit and wording of the particular policy remain important to that assessment.
For claimants seeking to rely on an insolvent insured’s insurance, the decision is a reminder that rights transferred under the 2010 Act are subject to the terms of the insurance contract. A prior judgment establishing the insured’s liability does not remove every potential policy defence, and questions about the establishment of liability and its amount may remain relevant.
Frequently asked questions
Why did QBE refuse to cover the claim?
QBE relied on Protec’s failure to comply with policy conditions requiring notification of a potentially claim-related incident and the immediate forwarding of relevant legal correspondence.
Did the Court of Appeal find that Protec breached the policy?
Yes. The court upheld the findings that Protec breached Claims Conditions 2 and 3.5.
Did the policy have to call the clauses “conditions precedent”?
No. The court held that the effect of the clauses depended on interpreting the policy as a whole, and that these conditions operated as conditions precedent despite not using that exact label.
Did QBE have to prove that it suffered prejudice?
No. It was common ground that, once the conditions were treated as conditions precedent, QBE did not have to demonstrate prejudice caused by the breaches.
Was the appeal successful?
No. The Court of Appeal dismissed Mr Makin’s appeal. It did not decide the wider question concerning the effect of section 1 of the Third Parties (Rights Against Insurers) Act 2010, as that issue did not need to be resolved for the appeal.