LIABILITY RULINGS MAY PENALIZE U.K. SPORTS TEAMS

LONDON-Professional and amateur sports clubs in the United Kingdom may face greater liability exposures following two recent court rulings, though industry experts are split over whether they will lead to higher insurance costs.

The two court rulings, one against a professional soccer player and one against an amateur rugby referee, raise liability stakes for compensating injuries in both sports.

In the London High Court last month, Brian McCord, a former soccer player with Stockport County, became the first major league soccer player to win damages for injury against another professional player.

Mr. McCord's soccer career ended with a broken leg caused by a tackle by Swansea City captain John Cornforth during a game in March 1993.

The judge awarded Mr. McCord (British pounds)50,000 ($82,450) plus his projected loss of earnings. The final amount of the award will be decided later this year. The Swansea City team was covered in 1993 by a group liability insurance program placed in the London market by Windsor Insurance Brokers Ltd. and led by Sun Alliance P.L.C. The program, which covers the public liability and employers liability of all clubs in England's top three divisions, excluding the Premier League, is currently led by Gerling A.G.

Football League Ltd., the company responsible for managing the league's three divisions, renews its policy in July.

Chris Griffin, the league financial controller, could not predict the ruling's impact on the program's rates. "A lot can happen between now and then," he said.

Gordon Taylor, chief executive of the Professional Footballers Assn., is more pessimistic.

"I would expect there to be an increase in premiums across the board," he predicted.

There has been a "steady increase in claims as the game has become more litigious," said Mr. Taylor, noting that several claims for sports-related injuries have been settled out of court.

Players can purchase disability insurance themselves through a package underwritten by syndicates at Lloyd's of London, but most players rely on insurance provided by their clubs, said Mr. Taylor.

Separately, London's Appeal Court last month upheld an award to a young amateur rugby player who was crippled during a match in 1991. The player, Ben Smoldon, is seeking more than (British pounds)1 million ($1.7 million) from referee Michael Nolan, claiming he fell below the standards of a competent referee in failing to prevent the player's injury (BI, May 6, 1996).

It was the first case in which an English court has ruled that a rugby referee can be liable to a player for injuries caused by the referee's alleged negligence.

London-based Rugby Football Union, the association governing amateur rugby in England, has professional liability insurance for all referees overseeing Rugby Union matches in the country.

The RFU's insurance coverage is led by Sun Alliance P.L.C.

Insurance market practitioners, however, seem relaxed about the judgments.

Jonathan Ticehurst, head of the sports division at Windsor Insurance Brokers, said it is too early to predict the impact of the judgments on insurance rates or capacity for sports-related risks.

Both cases are unusual and involve a particular set of circumstances, he said.

"The Court of Appeal and the original judge in the Smoldon case stressed that there were exceptional circumstances and an additional duty of care owed because of the age of the players," agreed Phil Bell, technical manager of the global risks division of Royal & Sun Alliance P.L.C.

The rugby match was a game of Colts rugby, a special form of the game for junior players.

"The judge stressed that (the duty of care) wouldn't have been the same if it had been a senior game, so it is unlikely to have a significant impact on referees generally," said Mr. Bell.

However, the RFU said that the judgment had "extended the scope of potential liability for sporting officials" and that the decision "must have implications for the playing and refereeing of the game."

The soccer judgment in the High Court, meanwhile, involved a "particularly vicious foul and was ruled not to have been an accident," said Mr. Bell, noting that it is too early to tell whether it will lead to an increase in similar claims.