Monarch Airlines Ltd v London Luton Airport Ltd [1997] CLC 698
Clarity of exclusion clauses, negligence
Facts
The Claimant airline had one of its planes damaged by a loose paving stone, while taxing on the runway of the airport operated by the Defendant. The parties’ relationship was governed by a contract which included an exemption clause excluding liability ‘… for any damage to aircraft resulting from an omission, neglect or default….’ by the Defendant.
Issues
The issue in this case was the meaning of this clause, and specifically on whether it could extend to negligence. In this instance it was a matter of clarity whether reference to “neglect” would also mean negligence within the specific legal meaning.
Decision/Outcome
It was held that the wording of the clause was sufficiently clear to extend to negligence, and did indeed so extend. Use of what effectively amounted to synonyms of a term (in this case “neglect”, “omission” etc, does not mean that the court will be blind to the meaning of the words used. In this instance, the words used clearly amounted to the same thing as they would have if the word “negligence” was used, and the clause was treated as such. The court held that making such determinations ought to involve considerations of the full set of facts and context of the case. It was held that this was the correct approach to be adopted (instead of an automatic exclusion of liability), and that this is the correct application of the third part of the test in Canada Steamship Lines v The King [1952] AC 192.
Updated 20 March 2026
This case summary remains legally accurate. Monarch Airlines Ltd v London Luton Airport Ltd [1997] CLC 698 is a real decision and the summary correctly reflects the court’s reasoning on the construction of exclusion clauses and the extension of such clauses to negligence. The reference to the three-stage test from Canada Steamship Lines v The King [1952] AC 192 is also accurate; that test remains good law, though readers should be aware that its application has been refined in subsequent cases, notably HIH Casualty and General Insurance Ltd v Chase Manhattan Bank [2003] UKHL 6 and Persimmon Homes Ltd v Ove Arup & Partners Ltd [2017] EWCA Civ 373, which have emphasised that the Canada Steamship guidelines are not rigid rules but an aid to construction in light of the contract as a whole. Additionally, where the Unfair Contract Terms Act 1977 applies, any clause purporting to exclude liability for negligence causing loss or damage to property remains subject to a reasonableness requirement under that Act. The article does not engage with the 1977 Act, which may be a relevant consideration depending on the contractual context. For consumer contracts, the Consumer Rights Act 2015 may also be relevant, though that would not affect the outcome on the facts of this commercial dispute.
