It is difficult to distinguish between momentary inattention and mere inadvertence. If there is no difference, then Lloyd LJ may have been confused in Sofi when he commented that the insurers’ submission might have succeeded if the insured had given no thought to the danger of theft, when there is also a reference to the insurer being liable if the matter was one only of momentary inattention. They both involve a failure to consider the risk properly at the relevant time, but momentary inattention would require the insured to comply with the policy generally, but for a moment when he fails to take all reasonable steps because he was sufficiently distracted to forget it temporarily. Inadvertence could either be a failure to consider the risk at all, or to believe that steps had been taken when they had not, e.g. by removing the car keys but accidentally dropping them, having locked the car. Momentary inattention constitutes negligence, as does inadvertence, but this is precisely what the policy is intended by the insured to cover. The impression given by Sofi is that had the keys been left in the ignition inadvertently, the claim of the insured would have been met. However, such negligence could become a breach of the term with the passage of time, if the insured realises that he is in breach but fails to act to remedy the situation. The element of time may be relevant to the insurer in proving that the insured must at some stage have appreciated the risk but failed to act, e.g. he must have concluded that he left his keys in the car when he was unable to locate them. However, if, for example, an insured omits to set the burglar alarm, and maintains that he forgot and did not become aware of his omission until returning to the premises, then the insurer will have an uphill task in establishing a breach of the condition.
A reasonable care condition may sometimes include an obligation on the insured to behave as though he were uninsured. This appears to be a wholly subjective requirement so that, for example, where the “insured” would not have taken elaborate precautions to protect items of low value, there would be no lack of reasonable care because the insured would probably have failed to take any reasonable precautions whether he had been insured or not.
The Court of Appeal in Sofi also refused to distinguish between liability and property insurance for the applicability of the recklessness test. It is well established that in third party liability policies reasonable care provisions require the insured only to avoid recklessness. Slade LJ stated that the recklessness test is equally applicable to property or liability insurance. It is therefore clear that this test will be applicable in ARPI policies.
The court in Sofi also set out the guidelines then in use by the Insurance Ombudsman, which were as follows:
– What was the value of the goods at risk?
– What was the reason for having them in the place from which they were stolen?
– What precautions were actually taken to safeguard them?
– Were there any alternatives open to the policyholder?
The court commented that the greater the value of the goods insured, the greater the risk that they would be stolen, and the easier it would be for the insurer to establish the insured deliberately courted the risk by taking measures which he knew to be inadequate.