The Supreme Court ruled that Denis Collins was entitled to disability payments for five years after a 1996 accident aboard the Pacific Constructor in Dubai. It allowed his appeal on the contractual claim and dismissed the employer’s cross-appeal. The ruling did not alter the Court’s earlier dismissal of Collins’s negligence claim.
Collins, a commercial diver working mainly for J. Ray McDermott S.A., fell down an internal staircase while preparing to leave the vessel on 17 August 1996. He suffered a cerebral contusion, hearing loss and injuries to both shoulders. The parties agreed that the head injury carried a risk of epilepsy that would decline over five years to the general-population level.
After the accident, the employer’s agent wrote that Collins would receive $150 a day in disability pay, followed after two months by half-pay of $75 a day for up to ten months or until maximum medical improvement. The Supreme Court said the parties accepted that this letter contained the relevant contractual terms. The employer later stopped payments in 1998.
The High Court had awarded Collins on the contractual claim, finding that the employer had accepted an obligation to compensate him until maximum medical improvement. It assessed the relevant date as October 1998 and calculated an amount due of $13,650, assuming payments stopped on 7 April 1998. The High Court dismissed his negligence claim. On 21 February 2007, the Supreme Court had already dismissed his appeal against that negligence decision, reserving the contractual issues addressed in this judgment.
In April 1998, Collins contracted meningitis and had an epileptic fit. His counsel accepted that the episode was unrelated to the Dubai head injury and left him permanently unable to return to diving. Collins argued that payments under the letter should nevertheless continue until the risk from the original head injury had fallen away, which the medical evidence put at five years. The employer argued that the later illness ended any further payment obligation.
The Supreme Court found the letter ambiguous and construed it against the employer, which had issued it through its agent. It held that “maximum medical improvement” referred to recovery from the occupational injury, not other illness or incapacity. The later meningitis did not extinguish the undertaking: the Court said the two sources of epilepsy risk were distinct and that the letter did not make continued payments conditional on Collins remaining unfit to work.
The Court therefore held that payments were due for five years from the accident date. It allowed Collins’s appeal on the contractual issue and dismissed the employer’s cross-appeal.