Category: Insurance

Involnert Management Inc v Aprilgrange Ltd and Others: ComC 10 Aug 2015

The claimant’s yacht ‘Galatea’ caught fire at her mooring in the Athens Marina. As a result of the fire, the yacht was damaged beyond economic repair. The defendant insurers had agreed to insure the Yacht against all risks for an agreed value of 13 million Euros. In this action the claimant is seeking to recover that sum from Insurers. Insurers accept that the loss was an accident of a kind which the policy was intended to cover. They deny liability to pay the claim, however, on a number of grounds.

Leggatt J
[2015] EWHC 2225 (Comm)
Bailii
England and Wales
Cited by:
Main Judgment – Involnert Management Inc v Aprilgrange Limited and Others ComC 8-Oct-2015
Date from which interest was to run on principal damages award. . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 03 January 2022; Ref: scu.551296

Jones v Zurich Insurance Plc: ComC 18 May 2021

Trial of a claim by the Claimant to recover the agreed value of a Rolex Daytona Tropical watch under a policy of insurance underwritten by the Defendant

His Honour Judge Pelling QC,
Sitting as a Judge of the High Court
[2021] EWHC 1320 (Comm)
Bailii
England and Wales

Insurance

Updated: 03 January 2022; Ref: scu.663104

Equity Syndicate Management Ltd v Glaxosmithkline Plc: ComC 23 Jul 2015

The court was asked: ‘whether a contract of insurance between Glaxo Smith Kline (‘GSK’) as insured and Equity Red Star (‘Equity’, also known as Syndicate 318 at Lloyd’s) as insurer should be rectified. Unusually, however, both parties to the contract agree that it should be rectified because the cover which it provided was wider than was intended. They agree that the contract was never intended to insure the liability of a GSK employee, Ms Janet Ball, who was involved in an accident on 5 October 2006. The claim for rectification is resisted by another insurance company, Axa, which undoubtedly insured Ms Ball. Axa contends that the wording of the Equity cover extends to Ms Ball; that as a result there was double insurance in place; and that it is therefore entitled to a 50% contribution from Equity towards what it has paid to the victim of the accident in which Ms Ball was involved. ‘

Males J
[2015] EWHC 2163 (Comm)
Bailii
England and Wales

Insurance

Updated: 02 January 2022; Ref: scu.550501

Woolwich Building Society v Taylor and Another: ChD 17 May 1994

A person requesting third party information under the Act, must first establish a claim sufficient to justify the right claimed. The third party claimant’s right against the insured arose at the time when the claimant suffered a loss but that the right of the insured to sue his insurer in respect of the liability he had incurred did not arise until the liability had been ascertained by judgment, award or agreement. Since it was impossible to know whether a right had been transferred until such judgment award or agreement had occurred, no information could reasonably be required, before such judgment award or agreement, ‘for the purpose of ascertaining whether any rights have been transferred or vested’ in the claimant by the Act.

Lindsay J
Times 17-May-1994, [1995] 1 BCLC 132
Third Parties (Rights Against Insurers) Act 1930 2
England and Wales
Cited by:
Cited – First National Tricity Finance Ltd v OT Computers Ltd; In re OT Computers Ltd (in administration) CA 25-May-2004
The company had gone into liquidation. They had sold consumer policies as extended warranties on behalf of the claimant. The company had insured its own joint liability under the contracts, and the claimant sought information from the company’s . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Insurance

Updated: 01 January 2022; Ref: scu.90601

Ram (Administrator of The Estate of Pearl Baboolal) v Motor and General Insurance Company Ltd: PC 18 May 2015

Trinidad and Tobago – There had been a road traffic accident leading to the loss of several lives. The insurer of the negligent party resisted paying out more in damages, saying that its liability was limited to $1m, and: ‘The principal issue in this appeal is whether an insurance company, before it pays third party claims under an insurance policy which has a contractual monetary limit on the aggregate of claims arising out of one event which equates with the statutory minimum cover, must (a) ascertain the total claims arising from the event and (b) where the total exceeds the limit, devise a scheme for the proportionate payment of the claims.’

Lord Mance, Lord Clarke, Lord Sumption, Lord Carnwath, Lord Hodge
[2015] UKPC 22
Bailii
Commonwealth

Insurance, Road Traffic

Updated: 30 December 2021; Ref: scu.546864

Society of Lloyd’s v Laws and others: ComC 24 Apr 2003

Cooke J
[2003] EWHC 873 (Comm)
Bailii
England and Wales
Cited by:
Cited – Thomas-Everard and Others v Society of Lloyd’s ChD 18-Jul-2003
The claimant appealed refusal to set aside a statutory demand made by the respondent society. The proposed defence had been already been dismissed by the courts.
Held: Such a consideration was very relevant, but not necessarily determinative. . .

Lists of cited by and citing cases may be incomplete.

Insurance, Litigation Practice

Updated: 30 December 2021; Ref: scu.181326

Teal Assurance Co Ltd v W R Berkley Insurance Europe Ltd and Another: ComC 23 Apr 2015

‘trial of certain preliminary issues in relation to disputes arising between the claimant (‘Teal’) and its defendant reinsurers (the ‘Reinsurers’). In essence, the questions concern the time at which, and therefore the order in which, insured losses were suffered for the purpose of a programme of professional indemnity insurance and reinsurance.’

Eder J
[2015] EWHC 1000 (Comm)
Bailii

Insurance

Updated: 29 December 2021; Ref: scu.546185

Van Hove v CNP Assurances SA: ECJ 23 Apr 2015

ECJ (Judgment) Reference for a preliminary ruling – Directive 93/13/EEC – Unfair terms – Insurance contract – Article 4(2) – Assessment of the unfairness of contractual terms – Exclusion of terms relating to the main subject-matter of the contract – Term intended to ensure that mortgage loan repayments are covered – Borrower’s total incapacity for work – Exclusion from cover in the event of recognised fitness to undertake an activity, paid or otherwise

Ilesic P
C-96/14, [2015] EUECJ C-96/14
Bailii
Directive 93/13/EEC

European, Consumer, Insurance

Updated: 29 December 2021; Ref: scu.546113

The Presidential Insurance Company Ltd v Mohammed and Others: PC 3 Feb 2015

(Trinidad and Tobago) The principal issue in the appeal is whether the MVIA enables someone who has suffered property damage caused by a motor vehicle accident to obtain indemnity from the vehicle owner’s insurers when the driver, who caused the damage, was not authorised by the insurance policy to drive the vehicle.

Lord Mance, Lord Wilson, Lord Carnwath, Lord Toulson, Lord Hodge
[2015] UKPC 4
Bailii

Commonwealth, Insurance, Road Traffic

Updated: 27 December 2021; Ref: scu.542233

Western Trading Ltd v Great Lakes Reinsurance (UK) Plc: QBD 26 Jan 2015

‘This fire insurance claim by the Claimant is resisted by the Defendant on the grounds that the assured had no insurable interest and that there was misrepresentation and non disclosure. The Defendant also claims that if the Claimant does have a valid claim it should not have a Declaration that it is entitled to be indemnified for the cost of reinstatement. ‘

Mackie QC HHJ
[2015] EWHC 103 (QB)
Bailii
England and Wales

Insurance

Updated: 27 December 2021; Ref: scu.541768

Sugar Hut Group and Others v A J Insurance: ComC 20 Oct 2014

The claimants had engaged the defendant insurance brokers to secure fire insurance. Their property was badly damaged by fire. The insurers had successfully repudiated liability for non-disclosure, but the judge had also found that the fault arose through the negligence of the defendants.

Eder J
[2014] EWHC 3352 (Comm)
Bailii

Insurance, Agency

Updated: 22 December 2021; Ref: scu.537765

Farnworth And Another v Hyde: CExC 27 Feb 1865

A vessel was stranded and frozen up in the St Lawrence in the beginning of the winter; and, on the breaking up of the ice in the Spring, she was found to be in imminent peril, and, after several surveys, both ship and cargo were sold under circumstances which the jury found to constitute a reasonable necessity for an immediate sale, the expense of getting the ship afloat and repairing her, and of forwarding the cargo (timber) to its destination (Liverpool) being greater than their value when so respectively repaired and carried :-Held, that the underwriters on cargo were liable as for a total loss, without notice of abandonment ; the information of the loss and of the sale having both reached the assured at the same time.

[1865] EngR 274, (1865) 18 CB NS 835, (1865) 141 ER 674
Commonlii
England and Wales

Insurance, Transport

Updated: 18 December 2021; Ref: scu.281186

In Re A Company No 007816 of 1994, Same Re 007818, 007819, 007820, etc: ChD 13 Oct 1995

The company was said to have acted in breach of section 2(1) of the1982 Act.
Held: A Minister’s application to wind up companies in the public interest must be cogently argued. Insurance authorisation depends on where the effecting and carrying out of contracts of insurance occurs. The purpose of the addition of the words ‘as principal’, which had not appeared in earlier equivalent legislation, was to confirm that it did not extend to agents duly authorised by insurers.
That an insurance contract is made outside the UK does not mean that there cannot be the carrying on of an insurance business within the UK. Some activities conducted by brokers in the UK on behalf of offshore companies (other than the mere acceptance of risk) can amount to evidence that the offshore companies were carrying on business in the UK.

Times 13-Oct-1995, [1997] 2 BCLC 685
Companies Act 1986 124A, Insurance Companies Act 1982 2(1)
England and Wales

Company, Insurance

Updated: 18 December 2021; Ref: scu.81646

Sunport Shipping Limited, Prometheus Maritime Corporation, Celestial Maritime Corporation, Surzur Overseas Limited v Tryg-Baltica International (UK) Limited, C N R Atkin: ComC 27 Feb 2002

A claim was made under a marine insurance policy. The policy incorporated the Institute War and Strikes Clauses, Hulls-Time of 1/10/83, and included a clause ‘loss damage . . arising from . . Detainment . . by reason of infringement of any customs or trading regulations.’ The ship was detained for possible involvement in illegal drugs importing to Greece. The insurers sought to deny liability under the clause.
Held: The phrase should be interpreted to achieve a business-like result and to include provisions of law controlling imports and exports and regulation of the misuse of drugs. It had to be interpreted widely to allow for the need to recognise the laws of any country.

Mr Justice Cresswell
Times 05-Apr-2002, Gazette 18-Apr-2002, [2002] EWHC 235 (Commercial)
Bailii
England and Wales
Cited by:
Appeal from – Sunport Shipping Limited, Prometheus Maritime Corporation, Celestial Maritime Corporation, Surzur Overseas Limited v Tryg-Baltica International (UK) Ltd (Formerly Know As Colonia Baltica Insurance Ltd) and others CA 24-Jan-2003
(The ‘Kleovoulos of Rhodes’) A large quantity of cocaine was discovered by divers behind a grille in a sea chest at the vessel’s discharge port, Aliveri – having been placed there by unknown third persons at the load port in Colombia, South America. . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 16 December 2021; Ref: scu.167735

Beacon Insurance Company Ltd v Maharaj Bookstore Ltd: PC 9 Jul 2014

(Trinidad and Tobago) The Board was asked as to an insurance claim arising out of a fire and the insurance company’s rejection of that claim on the ground that part of it was fraudulent or had involved fraudulent devices. The principal issue was whether the Court of Appeal was entitled to overturn the findings of fact made by the judge at first instance.

Lord Mance, Lord Sumption, Lord Reed, Lord Toulson, Lord Hodge
[2014] UKPC 21, [2014] 4 All ER 418
Bailii
Commonwealth
Cited by:
Cited – Carlyle (Scotland) v Royal Bank of Scotland Plc SC 11-Mar-2015
Assessing Whether 1st Judge was Plainly Wrong
The Court was asked whether, on an objective assessment of a what a developer and the bank had said to each other, the bank intended to enter into a legally binding promise to advance sums in the future to fund not only the developers purchase of . .
Cited – Paymaster (Jamaica) Ltd and Another v Grace Kennedy Remittance Services Ltd PC 11-Dec-2017
(Court of Appeal of Jamaica) The parties disputed the ownership of copyight in certain computer software, and also an allegation of the misuse of confidential information. . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 16 December 2021; Ref: scu.533886

Tokio Marine Europe Insurance Ltd v Novae Corporate Underwriting Ltd: ComC 2 Jul 2014

Application for summary judgment by the Claimant relating to one of the defences of the Defendant to a claim under a facultative excess of loss reinsurance in respect of a payment made by TMEI to the original insurer, ACE European Group Ltd following the settlement by ACE of a claim by the original insured, Tesco plc and its subsidiaries.

Field J
[2014] EWHC 2105 (Comm)
Bailii

Insurance

Updated: 16 December 2021; Ref: scu.533815

The Federal Mogul Asbestos Personal Injury Trust v Federal-Mogul Ltd and Others: ComC 27 Jun 2014

The claimant trust sought declarations regarding the responsibility of the defendant re-insurers to indemnify the insurers in respect of claims for asbestos related injuries on claims by the Trust on behalf of those injured.

Eder J
[2014] EWHC 2002 (Comm)
Bailii

Insurance, Personal Injury

Updated: 15 December 2021; Ref: scu.533191

Welch v Royal Exchange Assurance: CA 1938

The court was asked whether compliance with a clause in the insurance contract was a condition precedent. There was also a question whether the insured could rely on facts arising after the making of their claim.
Held: If a clause does not set out the time limit by which compliance is required, the insured must comply (a) within a reasonable time and (b) in any event before proceedings are issued,
Slesser LJ said: ‘During the hearing before the arbitrator it was for the first time relied upon by the insurance company that the claimant had failed to give the respondents any information which was reasonably required with respect to two banking accounts of his mother which had been used and controlled by the claimant for the purpose of his business and that large sums of money accruing to the claimant had been paid by him into the accounts and large sums drawn out of the accounts by him for the purposes of his business.
At the arbitration, in the course of the cross-examination of the claimant, the claimant, for the first time, offered to give, and did give, full information as to these two banking accounts, but the learned arbitrator finds that until the accounts were so produced the respondents were not in possession of sufficient information to enable them to allege that the claimant’s failure to give information in respect of the said accounts was a breach of condition 4 of the policy.’
. . And ‘In these circumstances, even if the requirement of information in condition 4 be not a condition precedent, but merely a condition that the insurance company need not pay until the information required in condition 4 is provided, the appellant fails because he cannot say that such information was in fact given before the claim was made, and therefore it becomes to my mind unnecessary in this case to determine whether the failure to comply with condition 4 as to information was a failure to satisfy a condition precedent. For myself, I would wish to keep open that question. Had the phrase at the end of condition 4 been ‘no claim under this policy shall ‘be payable until the terms of this condition have been ‘complied with’ instead of the word ‘unless,’ the case would have resembled that of Weir v. Northern Counties of England Insurance Co. (I), where it was held that such words did not constitute a condition precedent but only a requirement to be satisfied before a liability to pay arose, but it may well be said that here the word ‘unless’ has no such temporal limitation.
In the result I think this appeal should fail, not upon the ground that condition 4 is a condition precedent, but upon the ground of the claimant’s failure to give necessary information before a claim was made by him, which failure the appellant through his own act in the circumstances of this case is unable to excuse.’
MacKinnon LJ said: ‘But in truth the more formidable argument for the respondents does not depend on the last sentence of condition 4. They say that the promise in the body of the policy is ‘subject to the conditions which, so far as the nature of ‘them permits shall be deemed to be conditions precedent to ‘the right of the insured to recover.’ In condition 4 there is the provision that ‘the insured shall give all such information as ‘shall reasonably be required.’ The nature of this requirement does permit compliance with it to be a condition precedent to the right of the insured to recover. It is found by the arbitrator that it has not been complied with. There has therefore been a breach of a condition precedent to the right of recovery.’ and ‘None the less I am driven to the conclusion that the stipulation that the insured shall give all such information as may be reasonably required is one whose nature permits it to be a condition precedent to the right of the assured to recover, and that the presence of the last sentence in condition 4 does not by any ambiguity alter that nature or invalidate that conclusion.’

Slesser, MacKinnon LJJ
[1939] 1 KB 294, [1938] 4 All ER 289
England and Wales
Cited by:
Cited – Bolton Metropolitan Borough Council v Municipal Mutual Insurance Ltd CA 6-Feb-2006
The deceased had come into contact with asbestos when working on building sites for more than one contractor. The claimant here sought contribution from the defendants for the damages it had paid to his estate. The issue was as to liability on . .
Cited – Shinedean Ltd v Alldown Demolition (London) Ltd and Another CA 20-Jun-2006
The second defendant insurers appealed a finding of liability, saying that the insured had failed to provide its documents within a reasonable time in order to meet a condition to that effect in its terms. The documents had not been provided for . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 11 December 2021; Ref: scu.238334

Farrell v Whitty: ECJ 19 Apr 2007

ECJ Compulsory insurance for civil liability in respect of motor vehicles Directives 72/166/EEC, 84/5/EEC and 90/232/EEC Injuries to the passengers of a vehicle – Part of a vehicle not adapted for the carriage of seated passengers.

[2007] EUECJ C-356/05, [2007] ECR I-3067, [2007] Lloyd’s Rep IR 525
Bailii
Directive 90/232/EEC, Directive 84/5/EEC, Directive 72/166/EEC
European

European, Insurance, Road Traffic

Updated: 10 December 2021; Ref: scu.251879

Britain Steamship Company Limited v The King and Others (“The Matiana”): CA 1919

The court was asked wheter a merchant vessel was acting a a military ship when in convoy.
Held: The appeal succeeded. Warrington LJ said: ‘Of course the sailing with convoy may easily assume the character of a warlike operation; if the convoy were actually attacked or if an attack were impending or immediately apprehended then from that moment the operations might well become warlike operations’.

Warrington LJ
[1919] 2 KB 670
England and Wales
Citing:
Appeal from – Britain Steamship Company Limited v The King and Others (‘The Matiana’) CA 1919
(Year?) The steamship was insured under a time policy against perils of the sea and stranding, and under further insurance against risks excluded under the first, particularly risks of hostile action. It was in a convoy of four ships zig zagging in . .

Cited by:
Appeal from – Britain Steamship Company Limited v The King and Others (‘The Matiana’) HL 1921
The House considered the relationship between a merchant vessel in convoy and a convoying naval vessel.
Held: The appeal succeeded. Lord Atkinson: ‘With all respect, I am quite unable to concur in the learned judge’s view that the merchant . .
Cited – Fogg and Ledgard v The Secretary of State for Defence, Short Admn 13-Dec-2005
The applicants sought judicial review of a decision of the respondent not to name the wreck of the merchant ship SS STORAA as a protected site under the 1986 Act. It had been a merchant ship forming part of a convoy, and was sunk by enemy action in . .
Approved – Fogg and Another, Regina (on the Application of) v Secretary of State for Defence CA 5-Oct-2006
The Secretary of State appealed an order declaring the wreck of a merchant ship lost through enemy action in 1943 when part of a convoy. He said it was wrong in law to make the declaration, having not been in military service as such when sunk even . .

Lists of cited by and citing cases may be incomplete.

Armed Forces, Transport

Updated: 10 December 2021; Ref: scu.237697

British Telecommunications Plc v Royal Mail Group Ltd: CA 8 Jul 2010

Claim for indemnity made by the appellant, British Telecommunications Plc (‘BT’), against the respondent, Royal Mail Group Limited (‘RMG’), in proceedings against BT by the widow of a victim of mesophelioma, Gordon Hilton.

[2010] EWCA Civ 974
Bailii
England and Wales

Insurance, Personal Injury

Updated: 06 December 2021; Ref: scu.551928

Global Process Systems Inc and Another v Berhad: SC 1 Feb 2011

An oil rig (The Cendor MOPU) was being transported from Texas to Malaysia. During the voyage, three of the four legs suffered damage. The insurers refused liability saying that the damage was the result of inherent weaknesses in the rig.
Held: The insurer’s appeal succeeded. The proximate cause of the loss was not the inherent vice, but the insured peril. Under the 1906 Act the fact that the goods are not reasonably fit in all respects to encounter the ordinary perils of the seas of the adventure insured, does not automatically deprive the assured of cover. There is no equivalent to the provisions relating to time policies, where loss or damage attributable to unseaworthiness at the outset known to the assured is excluded.

Lord Mance, Lord Collins, Lord Clarke, Lord Dyson, Lord Saville
[2011] UKSC 5, UKSC 2010/0006, [2011] 1 All ER 869, [2011] 1 Lloyds Rep 560, [2011] Bus LR 537, 2011 AMC 305
Bailii, Bailii Summary, SC Summ, SC
Marine Insurance Act 1906 55(1)
England and Wales
Citing:
At first instance – Global Process Sytems Inc and Another v Syarikat Takaful Malaysia Berhad ComC 31-Mar-2009
The Cendor MOPU
The insurance company had refused a claim after the failure of an oil rig, saying that the loss of the rig legs during transit was the inevitable consequence of the voyage, and that since insurance was against risks, not certainties, they were under . .
Appeal from – Global Process Systems Inc and Another v Berhad CA 17-Dec-2009
An oil rig suffered major damage in transit in rough seas. The insurers repudiated liability saying that the damages was the result of a natural vice rather than perils at sea.
Held: The fact that the sea conditions were within the range of . .
Cited – J J Lloyd Instruments Ltd v Northern Star Insurance Co Ltd (The ‘Miss Jay Jay’) CA 1987
The owner claimed for damage to the hull of the Jay Jay.
Held: Where there are two operative causes, one covered by the policy risks and one not, then provided that the second cause is not an excluded peril, the Assured can recover. There was . .
Cited – Wayne Tank and Pump Company Ltd v Employers Liability Assurance Corporation Ltd CA 1973
The court discussed the effect of an exception clause in an insurance policy: ‘The effect of an exception is to save the insurer from liability for a loss which but for the exception would be covered. The effect of the cover is not to impose on the . .
Cited – Thomas Wilson Sons and Co v Owners of Cargo per the ‘Xantho’ HL 14-Jul-1887
A cause of damage otherwise satisfying the established definition may be a peril of the sea even though caused by a shipowner’s negligence. Lord Herschell said: ‘If that which immediately caused the loss was a peril of the sea, it matters not how it . .
Cited – Soya GmbH Mainz Kommanditgesellschaft v White CA 1982
Where insured goods deteriorated during a passage, not because they had been subjected to some external fortuitous accident or casualty, but because of their natural behaviour in the ordinary course of the voyage, then such deterioration amounted to . .
Cited – Soya GmbH Mainz Kommanditgesellschaft v White HL 1983
The cargo, soya beans, was insured against heating, sweating and spontaneous combustion risks. It arrived in a heated and deteriorated condition. The insurers denied liability saying that the proximate cause of the damage was inherent vice or nature . .
Cited – T M Noten BV v Hardin 1989
Industrial leather gloves were shipped from Calcutta to Rotterdam. On arrival the good were found to be wet, stained, mouldy and discoloured.
Held: The damage had been caused by moisture, which had been absorbed by the goods in the humid . .
Cited – T M Noten BV v Harding CA 1990
Bingham LJ wasasked as to what was meant by the proximate cause of an accident at sea, and said: ‘Unchallenged and unchallengeable authority shows that this is a question to be answered applying the common sense of a business or seafaring man.’ . .
Overruled – Mayban General Assurance Bhd, AMI Insurans Bhd, Malaysian International Insurance Bhd, Syarikat Takaful Malaysia Bhd v Alstom Power Plants Ltd, Alstom T and D Ltd QBD 11-May-2004
An electrical transformer was shipped from Ellesmere Port to Rotterdam and there transferred to a container vessel for carriage to Lumut. Severe weather was encountered, but not such as a commercial person would regard as falling outside the range . .
Cited – E D Sassoon and Co v Western Assurance Co PC 1912
(Shanghai) A cargo of opium was damaged as a result of ingress of water through a rotten hull.
Held: Losses occasioned by the incursion of water into a vessel’s hull owing to the defective, deteriorated or decayed condition of the hull or . .
Cited – Canada Rice Mills Ltd v Union Marine and General Insurance Co Ltd PC 1941
Cargo was on a voyage from Rangoon to British Columbia and insured against perils of the sea. It was damaged by reason of heating occasioned when cargo hold ventilators were closed to prevent ingress of water in heavy weather. The Court of Appeal of . .
Cited – J J Lloyd Instruments Ltd v Northern Star Insurance Co Ltd ‘The Miss Jay Jay’ 1985
Mustill J considered liability under a marine insurance where damage was suffered when the sea state was within what might reasonably be anticipated: ‘The cases make it quite plain that if the action of the wind or sea is the immediate cause of the . .
Cited – Steel v State Line Steamship Co 1877
An insured ship should be ‘in a condition to encounter whatever perils of the sea a ship of that kind and laden in that way may be fairly expected to encounter.’ However, an express exception of negligence did not cover loss due to unseaworthiness. . .
Cited – Nelson Marketing International Inc v Royal and Sun Alliance Insurance Co. of Canada 28-Jun-2006
(British Columbia Court of Appeal) Shipments of laminated truck flooring were damaged by moisture absorbed by the flooring in the course of manufacture, which on the voyage had evaporated and condensed in circumstances which were not established to . .
Cited – Robert Thompson, Joseph Lowes Thompson, And John Thompson v Thomas Duck Hopper 23-Feb-1856
There is not in general an implied warranty of seaworthiness in a time policy of assurance. . .
Cited – NE Neter and Co Ltd v Licenses and General Insurance Co Ltd 1944
A cargo of casks and bags of china clay out-turned damaged, as a result of the stoving in of the casks on a voyage during which there had been heavy weather.
Held: The claim failed. The plaintiffs had not proved that the proximate cause of the . .
Cited – Mountain v Whittle HL 1921
The insured vessel, a houseboat, was towed alongside a tug some seven and half miles to Northam. Her topside seams were leaky and defective. The breast wave thrown up by the two vessels caused water to mount up against the seams and enter and sink . .
Cited – Leyland Shipping Co Ltd v Norwich Union Fire Insurance Society Ltd HL 1918
The ship was insured against the perils of the sea by a policy containing a warranty against all consequences of hostilities. While voyaging to Le Havre, she was torpedoed by a German submarine 25 miles from port. She began to settle by the head, . .
Cited – Dudgeon v Pembroke 1877
If there are two concurrent causes of a loss, one falling within the policy, the other simply not covered by the terms of the policy, the insured may recover. . .
Cited – Thames and Mersey Marine Insurance Co Ltd v Hamilton, Fraser and Co 1887
Lord MacNaghten noted that: ‘In marine insurance it is above all things necessary to abide by settled rules and to avoid anything like novel refinements or a new departure’. . .

Cited by:
Cited – Navigators Insurance Company Ltd and Others v Atlasnavios-Navegacao Lda SC 22-May-2018
The vessel had been taken by the authorities in Venezuela after drugs were found to have been attached to its hull by third parties. Six months later it was declared a constructive total loss. The ship owners now sought recovery of its value from . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 01 December 2021; Ref: scu.428360

Cosco Bulk Carrier Co Ltd and Another v M/V ‘Saldanha’ C/P Dated 25/06/08: ComC 11 Jun 2010

The court considered the effect of a ship being taken by pirates at sea on the obligations in the charterparty contract. The insurers said that a claim for ‘average accident’ must include an element of physical damage – absent in this case.
Held: The appeal failed. ‘Average accident’ need not include physical damage, but nor could seizure by pirates amount to an accident. As a matter of indelible impression seizure by pirates is a ‘classic example’ of a totally extraneous cause.

Gross J
[2010] EWHC 1340 (Comm), [2010] 1 CLC 919, [2011] 1 Lloyd’s Rep 187
Bailii
England and Wales
Citing:
See Also – Masefield Ag v Amlin Corporate Member Ltd; The Bunga Melati Dua ComC 18-Feb-2010
. .
Not Followed – The Mareva AS 1977
The wording ‘average accident’ in the policy: ‘merely means an accident which causes damage.’ . .
Cited – Kidston v Empire Insurance Co 1866
The court was asked whether shipowners could recover under a sue and labour clause in a freight policy for the costs of transhipment expended in order to avoid the loss of the freight. There had been no abandonment and underwriters argued that this . .
Distinguished – The Laconian Confidence 1997
Charterers appealed against the decision of the arbitrator on the meaning of the phrase ‘any other cause’. The performance of the contract had been interrupted by the intervention of the authorities in Chittagong.
Held: The appeal failed. The . .
Cited – The Alfred Trigon 1981
The court considered the wording, in the context of a second-hand ship sale and purchase market, ‘average damage’.
Held: ‘Average’ here could not mean ‘damage’ simpliciter and was understandably construed to mean a particular kind of damage – . .
Cited – Kelman v Livanos 1955
. .
Cited – Chandris v Isbrandtsen-Moller Co Inc CA 1950
Although section 3(1) of the 1934 Act expressly empowered only courts of record to include interest in sums for which judgment was given for damages or debt, arbitrators were nevertheless empowered by the agreement of reference to apply English law, . .
Cited – Thomas Wilson Sons and Co v Owners of Cargo per the ‘Xantho’ HL 14-Jul-1887
A cause of damage otherwise satisfying the established definition may be a peril of the sea even though caused by a shipowner’s negligence. Lord Herschell said: ‘If that which immediately caused the loss was a peril of the sea, it matters not how it . .
Cited – Royal Greek Government v Minister of Transport CA 2-Jan-1949
The charterers had ordered the vessel to sail but her crew refused to do so, except in convoy, because of the war. A dispute arose as to whether, the charterers’ order to sail having been disobeyed, the vessel was off-hire.
Held: The appeal . .

Lists of cited by and citing cases may be incomplete.

Transport, Contract, Insurance

Updated: 01 December 2021; Ref: scu.416635

Thomas Wilson Sons and Co v Owners of Cargo per the ‘Xantho’: HL 14 Jul 1887

A cause of damage otherwise satisfying the established definition may be a peril of the sea even though caused by a shipowner’s negligence. Lord Herschell said: ‘If that which immediately caused the loss was a peril of the sea, it matters not how it was induced, even if it were by the negligence of those navigating the vessel.’ A shipowner owes the bill of lading holder a bailee’s duty of care and accordingly, construing the bill of lading contract as a whole, the shipowner could not rely on the ‘perils of the sea’ exception to oust his duty of care.
the words in a cancellation clause to ‘perils or danger and accidents of the sea’ bear the same meaning, as a matter of construction, in a bill of lading or contract of carriage as in an insurance policy.
The words ‘perils of the sea’: ‘do not protect, for example, against that natural and inevitable action of the wind and waves, which results in what may be described as wear and tear. There must be some casualty, something which could not be foreseen as one of the necessary incidents of the adventure. The purpose of the policy is to secure an indemnity against accidents which may happen, not against events which must happen.’

Lord Herschell, Lord Bramwell
(1887) 12 App Cas 503, [1887] UKLawRpAC 28
Commonlii
England and Wales
Cited by:
Cited – Cosco Bulk Carrier Co Ltd and Another v M/V ‘Saldanha’ C/P Dated 25/06/08 ComC 11-Jun-2010
The court considered the effect of a ship being taken by pirates at sea on the obligations in the charterparty contract. The insurers said that a claim for ‘average accident’ must include an element of physical damage – absent in this case.
Cited – Global Process Systems Inc and Another v Berhad SC 1-Feb-2011
An oil rig (The Cendor MOPU) was being transported from Texas to Malaysia. During the voyage, three of the four legs suffered damage. The insurers refused liability saying that the damage was the result of inherent weaknesses in the rig.
Held: . .
Cited – Volcafe Ltd and Others v Compania Sud Americana De Vapores Sa SC 5-Dec-2018
The claimant appellants, arranged shipment of bagged Colombian green coffee beans, stowed in 20 unventilated 20-foot containers from Panama to Rotterdam, Hamburg or Bremerhaven for on carriage to Bremen. The bill of lading for each consignment . .

Lists of cited by and citing cases may be incomplete.

Transport, Insurance

Updated: 01 December 2021; Ref: scu.416712

Albert v Motor Insurers Bureau: HL 1971

The plaintiff suffered injury as a passenger when getting a lift to work from a co-worker. The driver was uninsured and had given lift to several co-workers over a period of time, mking a charge.
Held: The lift arrangement was in the nature of a contract, and therefore under the MIB scheme, the MIB were obliged to pay compensation.
Viscount Dilhorne said: ‘To constitute carriage for hire or reward, it is not, of course, necessary that payment is made before the journey. If there is an arrangement that payment will be made for that it matters not when the payment is in fact made.’

Viscount Dilhorne
[1971] 3 WLR 291
England and Wales

Road Traffic, Insurance, Personal Injury, Contract

Updated: 30 November 2021; Ref: scu.565344

Scher and Others v Policyholders Protection Board and Others Ackman v Same: HL 1 Sep 1993

The Court of Appeal had defined the expression ‘any liability . . under the terms of any policy’ in wide terms. An insurance policy is a UK one, if the obligations to be performed might have been part of a UK operation.
Lord Mustill criticised an attempt by the judge to construe a statute in a vacuum divorced from any proper factual basis.

Lord Mustill
Independent 16-Jul-1993, Times 16-Jul-1993, Gazette 01-Sep-1993, Gazette 19-Jan-1994, [1994] 2 AC 57
Policyholders Protection Act 1975 4(2), Insurance Companies Act 1982 96(1), Third Party (Rights Against Insurers) Act 1930
England and Wales
Cited by:
Cited – Aitken v Financial Services Compensation Scheme Limited SCS 30-May-2003
. .

Lists of cited by and citing cases may be incomplete.

Insurance, International

Updated: 30 November 2021; Ref: scu.89046

Eurodale Manufacturing Ltd v Ecclesiastical Insurance Office Plc: CA 10 Feb 2003

Goods were insured whilst in transit. They were stored in a secure warehouse over a weekend pending delivery but were stolen. The insurance covered them ‘during the ordinary course of transit’.
Held: The goods were covered.

Lord Justice Ward,
Lord Justice Clarke,
And,
Lord Justice Longmore
[2003] EWCA Civ 203, Gazette 03-Apr-2003
Bailii
England and Wales
Citing:
Applied – Crows Transport Ltd v Phoenix Assurance Co Ltd 1965
The insured goods were stolen from temporary storage whilst awaiting being loading.
Held: They were ‘in transit’ under the insurance policy, everything done thereafter was incidental to and part of that transit. . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 29 November 2021; Ref: scu.181298

Nemeti and Others v Sabre Insurance Co Ltd: CA 3 Dec 2013

The court considered the power of courts to allow substitution of a new party after the expiration of the limitation period.

Sir Terence Etherton Ch, Hallett VP, Sharp LJJ
[2013] EWCA Civ 1555
Bailii
European Communities (Rights against Insurers) Regulations 2002, Road Traffic Act 1988 151
England and Wales
Citing:
Cited – Regina v Liverpool City Council Ex Parte Muldoon; Regina v Same Ex Parte Kelly HL 11-Jul-1996
The claimant sought to challenge a refusal of the Housing Authority to pay housing benefit. The Secretary of State had made the relevant Regulations determining eligibility for benefits. If the challenge were successful, the Secretary of State would . .
Cited – Irwin and Another v Lynch and Another CA 6-Oct-2010
The court considered an appeal against an order allowing an amendment outside the limitation period which would . .

Lists of cited by and citing cases may be incomplete.

Limitation, Insurance, Road Traffic

Updated: 26 November 2021; Ref: scu.518566

The North of England P and I Association (Freedom To Provide Services – Direct Insurance Other Than Life Assurance): ECJ 15 Apr 2021

Reference for a preliminary ruling – Direct insurance other than life assurance – Second Directive 88/357/EEC – Second indent of Article 2(d) – Directive 92/49/EEC – First subparagraph of Article 46(2) – Taxation of insurance premiums – Concept of ‘Member State where the risk is situated’ – Vehicles of any type – Concept of ‘Member State of registration’ – Insurance of sea-going vessels – Ships entered in the shipping register maintained by one Member State but flying the flag of another Member State or of a third State under a temporary flagging-out authorisation

[2021] EUECJ C-786/19, ECLI:EU:C:2021:276
Bailii
England and Wales

Insurance

Updated: 26 November 2021; Ref: scu.670071

Hall Brothers Steamship Company Limited v Young: CA 1939

The shipowners appealed a decision that the underwriters were not liable under collision liability clause. Their ship had collided with another at Dunkirk when the steering gear failed. Under french law the pilot was not liable since he had not been grossly negligent.
Held: The appeal failed.
Sir Wilfred Greene MR said: ‘the clause does not extend to every pecuniary liability arising in respect of the collision but only to such liabilities as arise by way of damages. The word ‘damages’ is one which to an English lawyer conveys a sufficiently precise meaning. This document is an English contract which falls to be construed according to English law. That does not, of course, mean that in its application to liabilities arising under foreign law (an application which the parties, of course, clearly contemplated as possible) the operation of the clause is to be excluded merely because some liability arising under foreign law as a result of a collision does not precisely coincide with the liability which is recognised in the Courts of this country. Nevertheless it is necessary in my opinion, in construing a document of this kind, to give to the word ‘damages’ its ordinary meaning in English law. ‘Damages’ to an English lawyer imports this idea, that the sums payable by way of damages are sums which fall to be paid by reason of some breach of duty or obligation, whether that duty or obligation is imposed by contract, by the general law, or legislation.
Now, the measure of the duty, of course, will depend upon the particular law. A statute may impose an absolute obligation not to do certain things, and as the result of that the person injured by the doing of such a thing may have a right to damages. That is a question of the measure of the duty. An example which was referred to in the course of the discussion is to be found in the Air Navigation Act, 1920, s.9, sub-s I, under which damages are recoverable from the owner of aircraft who causes damage irrespective of negligence or intention: it is a standard of duty not to do certain things imposed by that statute. Looking at it from another point of view, there are certain classes of liability to make pecuniary payments which clearly fall outside the word ‘damages’. For instance, compensation paid under the Land Clauses Act or a matter of that kind is certainly not damages. Workmen’s compensation payments are certainly not damages in the ordinary sense of the word, and in spite of Mr McNair’s argument to the contrary I find it quite impossible to suppose that workmen’s compensation payments are included in the word ‘damages’ in this clause. The foundation of that class of liability is something entirely different from the foundation of the liability which gives rise to a claim for damages.’

Sir Wilfrid Greene MR
[1939] 1 KB 748
Citing:
Appeal from – Hall Brothers Steamship Company Limited v Young 1938
The insured vessel, Trident, went to Dunkirk and engaged a French pilot whose pilot boat developed a fault in its steering gear which caused her to collide with Trident without Trident being in any way to blame. French law had a provision that . .

Cited by:
Cited – Yorkshire Water Services Ltd v Sun Alliance and London Insurance Plc and Others (1) CA 20-Aug-1996
The court was asked whether the costs of flood alleviation works were recoverable under public liability insurance policies.
Held: A claim for the costs of remedial action taken to mitigate future losses were not covered by the terms of the . .
Cited – Bedfordshire Police Authority v Constable and others ComC 20-Jun-2008
The authority insured its primary liability for compensation under the 1886 Act through the claimants and the excess of liability through re-insurers. The parties sought clarification from the court of the respective liabilities of the insurance . .
Cited – Bedfordshire Police Authority v Constable CA 12-Feb-2009
The police had responded to a riot at Yarlswood detention centre. They had insurance to cover their liability under the 1886 Act, but the re-insurers said that the insurance did not cover the event, saying that the liability was for statutory . .

Lists of cited by and citing cases may be incomplete.

Damages, Insurance

Updated: 23 November 2021; Ref: scu.270262

Yorkshire Insurance Co Ltd v Nisbet Shipping Co Ltd: QBD 1961

The assured alone can give a valid receipt and discharge to a third party against whom a judgment has been given following a successful subrogated claim.
Diplock J said: ‘The expression ‘subrogation’ in relation to a contract of marine insurance is thus no more than a convenient way of referring to those terms which are to be implied in the contract between the assured and the insurer to give business efficacy to an agreement whereby the assured in the case of a loss against which the policy has been made shall be fully indemnified, and never more than fully indemnified.’ and ‘The simple principle which I apply is that the insurer cannot recover under the doctrine of subrogation … anything more than he has paid.’

Diplock J
[1962] 2 QB 330, [1961] 2 All ER 487
England and Wales
Cited by:
Cited – Bee v Jenson ComC 21-Dec-2006
The defendant objected to paying the plaintiff the costs of a replacement hire car after the accident for which he was liable. He said that the plaintiff was in any event insured to recover that cost, and the insurance company were subrogated to the . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 23 November 2021; Ref: scu.247979

Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (The Good Luck): HL 1992

The effect of breach of an insurance warranty is automatic, rather than dependant on any acceptance or election.
Lord Goff of Chieveley said: ‘So it is laid down in section 33(3) that, subject to any express provision in the policy, the insurer is discharged from liability as from the date of the breach of warranty. Those words are clear. They show that discharge of the insurer from liability is automatic and is not dependent upon any decision by the insurer to treat the contract or the insurance as at an end; though, under section 34(3), the insurer may waive the breach of warranty.
Section 33(3) of the Act reflects what has been described, in successive editions of Chalmers, The Marine Insurance Act 1906, as the inveterate practice in marine insurance of using the term ‘warranty’ as signifying a condition precedent.’ Lord Goff referred to Thomson -v- Weems and said ‘Once this is appreciated, it becomes readily understandable that, if a promissory warranty is not complied with, the insurer is discharged from liability as from the date of breach of warranty, for the simple reason that fulfilment of the warranty is a condition precedent to the liability of the insurer . . In the case of conditions precedent, the word ‘condition’ is being used in its classical sense in English law, under which the coming into existence of (for example) an obligation, or the duty or further duty to perform an obligation, is dependent upon the fulfilment of the specified condition. Here, where we are concerned with a promissory warranty, i.e. a promissory condition precedent, contained in an existing contract of insurance, non-fulfilment of the condition does not prevent the contract from coming into existence. What it does (as section 33(3) makes plain) is to discharge the insurer from liability as from the date of the breach. Certainly, it does not have the effect of discharging the contract ab initio. Nor, strictly speaking, does it have the effect of bringing the contract to an end. It is possible that there may be obligations of the assured under the contract which will survive the discharge of the insurer from liability, as for example a continuing liability to pay premium. Even if in the result no further obligations rest on either party, it is not correct to speak of the contract being avoided; and it is, strictly speaking, more accurate to keep to the carefully chosen words in section 33(3) of the Act, rather than to speak of the contract being brought to an end, though that may be the practical effect. When, as section 34(3) contemplates, the insurer waives a breach of a promissory warranty, the effect is that, to the extent of the waiver, the insurer cannot rely upon the breach as having discharged him from liability. This is a very different thing from saying that discharge of the insurer from liability is dependent upon a decision by the insurer.

Lord Goff of Chieveley
[1992] 1 AC 233
Marine Insurance Act 1906 33
England and Wales
Citing:
Appeal from – Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (The Good Luck) CA 1990
When a contract is to be construed purposively, the court must look to the purposes of both parties, not just one of them. No apportionment was to be applied under the 1945 Act: ‘Similarly, we think that the facts and circumstances of the present . .
Cited – State Trading Corporation of India Ltd v M Golodetz Ltd CA 1989
Kerr LJ said: ‘What is commonly referred to as an acceptance of a repudiation must be communicated to the party in breach or at least overtly evinced. . An unequivocal act which is inconsistent with the subsistence of the contract may be sufficient, . .
Cited – Thomson v Weems HL 1884
Where a basis of the contract clause makes the correctness or completeness of the insured’s disclosure into a warranty, a breach of that warranty has the effect that the insurance cover never attaches under the contract.
Lord Blackburn said: . .

Cited by:
Cited – AXA General Insurance Limited v Gottlieb CA 11-Feb-2005
The defendant made a claim under an insurance policy. The insurer made an interim payment, but then asserted that the claim was fraudulent, and sought recovery of the interim payment.
Held: At common law, fraud in an insurance claim, once . .
Cited – Brit Syndicates Ltd and others v Italaudit Spa and others HL 12-Mar-2008
The parties disputed the extent of cover under an insurance policy. The insured firm of accountants had failed to verify the existence of a substantial balance claimed by the company it audited. The policy ‘included as an Assured Firm but solely in . .
Cited – Genesis Housing Association Ltd v Liberty Syndicate Management Ltd CA 4-Oct-2013
The housing association was to develop an estate of social housing, supported by an insurance guarantee. The insurance proposal contained a clause stating that the information in the proposal was to form the basis of the policy, and that the policy . .
Cited – Genesis Housing Association Ltd v Liberty Syndicate Management Ltd TCC 8-Nov-2012
Insurers had rejected a claim under the policy, saying that the proposal form had included a basis of insurance declaration warranted by the proposer, and that since it had named a main contractor different to the one named, there was no liability . .

Lists of cited by and citing cases may be incomplete.

Insurance, Transport

Updated: 23 November 2021; Ref: scu.223450

Yorkshire Water Services Ltd v Sun Alliance and London Insurance Plc and Others (1): CA 20 Aug 1996

The court was asked whether the costs of flood alleviation works were recoverable under public liability insurance policies.
Held: A claim for the costs of remedial action taken to mitigate future losses were not covered by the terms of the insurance policy. The court considered the relevance of American cases.
Stuart-Smith LJ said: ‘the American Courts adopt a much more benign attitude towards the insured; this seems to be based variously on the ‘folly’ argument in Leebov or ‘general principles of law and equity’ or that insurance contracts are: ‘contracts of adhesion between parties who are not equally situated’ giving rise to the principle: . . that doubts as to the existence or extent of coverage must generally be resolved in favour of insured . . or because the Courts have . . adopted the principle of giving effect to the objectively reasonable expectations of the insured for the purpose of rendering a ‘fair interpretation’ of the boundaries of insurance cover.’ As to the construction of contracts of insurance: ‘1. The words of the policy must be given their ordinary meaning and reflect the intention of the parties and the commercial sense of the agreement. Thus they must be construed in their context . . 2. A literal construction that leads to an absurd result or one otherwise manifestly contrary to the real intention of the parties should be rejected, if an alternative more reasonable construction can be adopted without doing violence to the language used. 3. In the case of ambiguity the construction which is more favourable to the insured should be adopted; this is the contra proferentem rule.’

Stuart-Smith LJ
Gazette 18-Sep-1996, Times 20-Aug-1996, [1997] 2 Lloyds Rep 21
England and Wales
Citing:
Cited – Charter Reinsurance Co Ltd v Fagan and Others HL 24-May-1996
The re-insurers appealed against a finding that they were liable to make payment under a contract which required them to pay ‘sums actually paid.’ They said that the company having become insolvent, no payment would in fact be made.
Held: The . .
Cited – Hall Brothers Steamship Company Limited v Young CA 1939
The shipowners appealed a decision that the underwriters were not liable under collision liability clause. Their ship had collided with another at Dunkirk when the steering gear failed. Under french law the pilot was not liable since he had not been . .

Cited by:
Cited – Pilkington United Kingdom Limited v CGU Insurance Plc QBD 28-Jan-2004
The claimants had installed glass tiles in a roof. They fractured, and facing a claim for damages, they sought payment from their insurers. The claimants argued that the risk of fracture meant that the damage occurred upon installation, the insurers . .
Cited – Blackburn Rovers Football and Athletic Club Plc v Avon Insurance Plc, Eagle Star Insurance Company Ltd, AGF Insurance Ltd IC Insurance Ltd ComC 15-Nov-2004
The claimant football club insured its players through the defendants. A footballer injured himself in training and his career was finished. The insurers rejected the claim, and relied upon exception clauses, saying that the true cause was a . .
Cited – Bedfordshire Police Authority v Constable and others ComC 20-Jun-2008
The authority insured its primary liability for compensation under the 1886 Act through the claimants and the excess of liability through re-insurers. The parties sought clarification from the court of the respective liabilities of the insurance . .
Cited – Bedfordshire Police Authority v Constable CA 12-Feb-2009
The police had responded to a riot at Yarlswood detention centre. They had insurance to cover their liability under the 1886 Act, but the re-insurers said that the insurance did not cover the event, saying that the liability was for statutory . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 23 November 2021; Ref: scu.90673

Spedition Welter Gmbh v Avanssur Sa: ECJ 10 Oct 2013

ECJ Insurance against civil liability in respect of the use of motor vehicles and enforcement of the obligation to insure against such liability – Directive 2009/103/EC – Article 21(5) – Claims representative – Authority to accept service of judicial documents – National rule making the validity of that service conditional on the express grant of an authority to accept it – Interpretation in conformity with Union law

C-306/12, [2013] EUECJ C-306/12
Bailii
Directive 2009/103/EC 21(5)

European, Road Traffic, Insurance

Updated: 22 November 2021; Ref: scu.516581

Enosi Epangelmation Asfaliston Ellados v Ipourgos Anaptixis: ECJ 17 Oct 2013

ECJ Directive 2002/92/EC – Insurance mediation – Exclusion of the activities pursued by an insurance undertaking or an employee acting under the responsibility of such an undertaking – Whether it is possible for such an employee to pursue insurance mediation activities on an incidental basis – Professional requirements

C-555/11, [2013] EUECJ C-555/11
Bailii
Directive 2002/92/EC
European

Insurance

Updated: 22 November 2021; Ref: scu.516573

Genesis Housing Association Ltd v Liberty Syndicate Management Ltd: CA 4 Oct 2013

The housing association was to develop an estate of social housing, supported by an insurance guarantee. The insurance proposal contained a clause stating that the information in the proposal was to form the basis of the policy, and that the policy would be void if any fact warranted in the proposal was wrong. The form mis-identified the main contractors.
Held: The appeal failed: ‘where a proposal form contains a ‘basis of contract’ clause, (i) the proposal form has contractual effect even if the policy contains no reference to the proposal form; (ii) all statements in the proposal form constitute warranties on which the insurance contract is based. They cannot therefore be treated as immaterial. ‘

Lord Dyson MR, Jackson, Gloster LJJ
[2013] EWCA Civ 1173, [2013] WLR(D) 368
Bailii, WLRD
England and Wales
Citing:
Cited – Condogianis v The Guardian Assurance Company Limited PC 2-May-1921
Australia – The insured had filled out a proposal form for fire insurance incorrectly having failed to mention in his answer to a question about a second of two fires for which he had previously claimed. The proposal form contained a declaration . .
Appeal from – Genesis Housing Association Ltd v Liberty Syndicate Management Ltd TCC 8-Nov-2012
Insurers had rejected a claim under the policy, saying that the proposal form had included a basis of insurance declaration warranted by the proposer, and that since it had named a main contractor different to the one named, there was no liability . .
Cited – Dawsons Ltd v Bonnin HL 1922
The House considered whether a provision was a warranty rather than a representation, allowing the contract to be avoided for its breach. It was an inadvertently inaccurate statement by the insured in the proposal form which was expressly . .
Cited – Rozanes v Bowen CA 1928
The court considered a proposal form for a jeweler’s block policy as filled in by the insured or his agent which incorrectly identified only one previous loss although there were several previous losses. The form stated that ‘It is understood that . .
Cited – Holmes v Scottish Legal Life Assurance Society KBD 1932
There had been an honest misstatement made by a son about his father’s health in a proposal form for a life insurance. The proposal form was made ‘the basis of the contract’ and there was a further provision in the policy that it could be avoided if . .
Cited – Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (The Good Luck) HL 1992
The effect of breach of an insurance warranty is automatic, rather than dependant on any acceptance or election.
Lord Goff of Chieveley said: ‘So it is laid down in section 33(3) that, subject to any express provision in the policy, the insurer . .
Cited – Unipac (Scotland) Ltd v Aegon Insurance Co (UK) Ltd SCS 1996
(Inner House) Information set out in a proposal form was incorrect and the declaration made by the insured was incorporated as the basis of the insurance. The insurer repudiated liability. . .
Cited – Unipac (Scotland) Ltd v Aegon Insurance Co (UK) Ltd SCS 1996
(Inner House) Information set out in a proposal form was incorrect and the declaration made by the insured was incorporated as the basis of the insurance. The insurer repudiated liability. . .
Cited – Economides v Commercial Union Assurance Co Plc CA 22-May-1997
The insured represented to the insurers that to ‘the best of his knowledge and belief’ the full cost of replacing all the contents in his flat as new was pounds 16,000. He contended that that meant that he honestly believed that pounds 16,000 was . .
Cited – Jagjivan Kumar v AGF Insurance Ltd ComC 10-Nov-1997
The court was concerned with a claim under a solicitors’ professional liability top up insurance policy. By clause 5 the insurer undertook ‘not to avoid repudiate or rescind this insurance upon any ground whatsoever including in particular . .
Cited – Zeller v British Caymanian Insurance Company Ltd PC 16-Jan-2008
(Cayman Islands) The Board considered the effect of a misdeclaration on a proposal for medical insurance.
Lord Bingham considered a statement which was said to be ‘complete and correct to the best of my knowledge and belief’. Lord Bingham . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 21 November 2021; Ref: scu.516255

Teal Assurance Company Ltd v WR Berkley Insurance (Europe) Ltd: SC 31 Jul 2013

An international engineering company had several layers of professional indemnity insurance. The top later did not cover claims originating in the US or Canada. The several insurers now disputed apportionment of liability between them. The appellants (Teal) appealed against decisions below that it was not entitled to select which claims to apportion to which policies, and that claimas must be apportioned to the successive layers as they fell.
Held: The appeal failed. Once the insured’s liability was settled, whether by agreement, judgment or award, the insured incurred expenses, within the scope of a liability policy A claim arose under the policy. That claim would either exhaust the policy cover entirely or pro tanto.
However, the insured may choose not to notify the claim to the insurers, and the policy would not thereby be exhausted.

Lord Neuberger, President, Lord Mance, Lord Clarke, Lord Sumption, Lord Toulson
[2013] UKSC 57, [2014] Lloyd’s Rep IR 56, [2013] WLR(D) 332, [2013] 2 CLC 390, [2013] 4 All ER 643, [2013] BUS LR 109, [2013] 2 All ER (Comm) 1009, UKSC 2012/0014
Bailii, WLRD, Bailii Summary, SC Smmary, SC
England and Wales
Citing:
At First Instance – Teal Assurance Company Ltd v W R Berkley Insurance (Europe) Ltd and Another ComC 31-Jan-2011
The parties disputed the proper construction and the operation of an excess reinsurance policy of professional liability insurance, and more specifically about how it is determined whether the ‘excess point’ that triggers the reinsurance cover has . .
Appeal from – Teal Assurance Company Ltd v WR Berkley Insurance (Europe) Ltd and Another CA 15-Dec-2011
. .
Cited – Post Office v Norwich Union Fire Insurance Society Ltd CA 1967
A contract of insurance provided an indemnity for ‘all sums which the insured shall become legally liable to pay as compensation in respect of loss of property’. The claim was by the Post Office against a contractor, Potters, for damaging one of . .
Cited – Bradley v Eagle Star Insurance Co Ltd HL 1989
Mrs Bradley was employed by Dart Mill several times from 1933 and 1970 and acquired byssinosis from inhaling cotton dust. The company was wound up in 1975 and dissolved in 1976. In 1984 she applied to the court for pre-action disclosure under . .
Cited – North River Ins Co v American Home Assurance Co 15-Mar-1989
California Court of Appeals . .
Cited – Rainy Sky Sa and Others v Kookmin Bank SC 2-Nov-2011
Commercial Sense Used to Interpret Contract
The Court was asked as to the role of commercial good sense in the construction of a term in a contract which was open to alternative interpretations.
Held: The appeal succeeded. In such a case the court should adopt the more, rather than the . .
Cited – Sprung v Royal Insurance (UK) Ltd CA 1999
An insured cannot recover damages at large for an insurer’s failure to pay. Interest on sums due under a policy is adequate compensation for late payment; this is so, even if an insurer deliberately withholds sums which he knows to be due under a . .
Cited – Ventouris v Mountain CA 1991
It is in the interests of the state which provides the court system and its judges at taxpayers’ expense that legal advisers should be able to encourage strong cases and discourage weak cases. ‘It is the protection of confidential communications . .
Cited – Apostolos Konstantine Ventouris v Trevor Rex Mountain, The Italia Express No 2 QBD 1992
A contract of marine insurance is not one to provide peace of mind or freedom from distress.
An assured cannot recover for losses caused by the insurer’s wrongful refusal to pay a valid claim. Interest on the sum is an adequate compensation. . .
Cited – Cox v Bankside Members Agency Ltd and Others QBD 27-Jan-1995
Some agents had policies against which there were likely to be various calls, either because several claims were being pursued against the same agents by different Lloyd’s Names, or because the policies were group policies covering several agents . .
Cited – Cox v Bankside Members Agency Ltd and Others CA 16-May-1995
Successful Lloyds names were entitled to enforce their claims in the normal time sequence. The transfer of the rights of the insured against the insurer under section 1(1) the 1930 Act takes place on the event of insolvency, even if the insured’s . .
Cited – Charter Reinsurance Co Ltd v Fagan and Others CA 6-Nov-1995
Liability of re-insurers arises on insurers becoming liable to pay, not payment. . .
Cited – Charter Reinsurance Co Ltd v Fagan and Others HL 24-May-1996
The re-insurers appealed against a finding that they were liable to make payment under a contract which required them to pay ‘sums actually paid.’ They said that the company having become insolvent, no payment would in fact be made.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 18 November 2021; Ref: scu.514221

John Paton Skilling v Zenith Insurance Plc: ScSf 31 Jan 2013

The pursuer sought indemnity from his insurers. They said that he had failed to disclose the fact that his car was an Audi A4 Quattro. He said that the on-line system through which he had applied did not allow him to make that specification, though there were later opportunities to do so. The insurers did not at that time have the facility to identify a car’s specification from its registration details.
Held: The pursuer had not acted in utmost good faith and his action failed: ‘An Audi A4 DTM FSI QUATTRO is a limited edition car. It`s power has gone from 197 bhp in the normal car to 217 bhp and a top speed of 152 mph. As its name implies the car is a four wheel drive vehicle. The A4 DTM FSI QUATTRO bears a little resemblance to the standard A4 two litre. ‘

Sherif Thomas Ward
[2013] ScotSC 23
Bailii

Insurance, Scotland

Updated: 17 November 2021; Ref: scu.513815

Verderame v Commercial Union Assurance Co Plc: CA 2 Apr 1992

The insurance brokers, acting to arrange insurance for a small private limited company did not owe a duty in tort to the directors of that company personally. Where an action was brought in a tort and in breach of contract, damages could not be awarded on the tort where they were not available in contract.

Balcombe LJ
[1992] BCLC 793, Times 02-Apr-1992
England and Wales
Citing:
Followed – Watts and Co v Morrow CA 30-Jul-1991
The plaintiff had bought a house on the faith of the defendant’s report that there were only limited defects requiring repair. In fact the defects were much more extensive. The defendant surveyor appealed against an award of damages after his . .

Cited by:
Cited – Johnson v Gore Wood and Co (a Firm) CA 12-Nov-1998
The claimant had previously issued a claim against the defendant solicitors through his company. He now sought to pursue a claim in his own name. It was resisted as an abuse of process, and on the basis that no personal duty of care was owed to the . .
Cited – Hamilton Jones v David and Snape (a Firm) ChD 19-Dec-2003
The claimant was represented by the respondent firm of solicitors in an action for custody of her children. Through their negligence the children had been removed from the country. She sought damages for the distress of losing her children.
Agency, Insurance, Company, Contract, Negligence, Damages

Updated: 16 November 2021; Ref: scu.181818

Walter Endress v Allianz Lebensversicherungs-Ag: ECJ 11 Jul 2013

ECJ Opinion – Life assurance – Right of cancellation – Cancellation period – Starting point and duration – Communication of information

Sharpston AG
C-209/12, [2013] EUECJ C-209/12
Bailii
European
Cited by:
Opinion – Walter Endress v Allianz Lebensversicherungs-Ag ECJ 19-Dec-2013
ECJ Request for a preliminary ruling – Directives 90/619/EEC and 92/96/EEC – Direct life assurance – Right of cancellation – Lack of information on the conditions governing the exercise of that right – Expiry of . .

Lists of cited by and citing cases may be incomplete.

Insurance, Consumer

Updated: 15 November 2021; Ref: scu.512345

Csonka v Magyar Allam: ECJ 11 Jul 2013

ECJ Use of motor vehicles – Insurance against civil liability – Directive 72/166/EEC – Article 3(1) – Directive 84/5/EEC – Article 1(4), first subparagraph – Insolvency of the insurer – No payment of compensation by the body providing compensation

C-409/11, [2013] EUECJ C-409/11
Bailii
Directive 72/166/EEC 3(1), Directive 84/5/EEC 1(4)

European, Insurance

Updated: 15 November 2021; Ref: scu.512336

Versloot Dredging Bv and Another v Hdi Gerling Industrie Versicherung Ag and Others (Rev 1): ComC 14 Jun 2013

[2013] EWHC 1667 (Comm)
Bailii
England and Wales
Cited by:
See Also – Versloot Dredging Bv and Another v Hdi Gerling Industrie Versicherung Ag and Others ComC 14-Jun-2013
The claimant shipowners suffered damage to their vessel and claimed under their policy with the defendants. The defendants argued that part of the evidence supporting the explanation of the claim was fabricated, thus excusing any payment.
Transport, Insurance

Updated: 14 November 2021; Ref: scu.510958

Manifest Shipping Co Ltd v Uni-Polaris Shipping Co Ltd and Others: HL 23 Jan 2001

The claimant took out insurance on its fleet of ships (the Star Sea). It had been laid up in its off season. The ship’s safety certificates were renewed before it sailed. It was damaged by fire. The insurers asserted that the ship had been unseaworthy, and that that was causative of the fire, and that the claimants knew of the condition, and that they had withheld a privileged expert report, said to be relevant to an allegation that the insured had knowingly sent the vessel to sea in an unseaworthy condition.
Held: That defence failed. The insurers then claimed that after litigation had commenced, the claimants had failed to make proper disclosure, and that since the contract was uberrimae fidei, that vitiated the entire insurance contract. It was not said the parties had actual knowledge of the unseaworthiness, but that they had ‘blind eye knowledge’. Such blind eye knowledge required a positive decision not to look. That was not established, and the appeal failed.
Liability for dishonest assistance requires a dishonest state of mind on the part of the person who assists in a breach of trust. Such a state of mind may consist in knowledge that the transaction is one in which he cannot honestly participate, or it may consist in suspicion combined with a conscious decision not to make inquiries which might result in knowledge.
Lord Scott of Foscote said: ‘Blind-eye’ knowledge approximates to knowledge. Nelson at the battle of Copenhagen made a deliberate decision to place the telescope to his blind eye in order to avoid seeing what he knew he would see if he placed it to his good eye. It is, I think, common ground – and if it is not, it should be – that an imputation of blind-eye knowledge requires an amalgam of suspicion that certain facts may exist and a decision to refrain from taking any step to confirm their existence.’
Lord Hobhouse observed: ‘The logic is simple. The fraudulent insured must not be allowed to think: if the fraud is successful, then I will gain; if it is unsuccessful, I will lose nothing.’
As to the Litsion Pride case, Lord Hobhouse said: ‘The particular claim was only fraudulent in so far as the broker had not been truthful in dealing with the insurers at that stage. The reasoning adopted by Hirst J has been criticised both by academic writers and by other judges in later cases. I consider that it should not any longer be treated as a sound statement of the law. . . In so far as it is based upon the principle of the irrecoverability of fraudulent claims, the decision is questionable upon the facts since the actual claim made was a valid claim for a loss which had occurred and had been caused by a peril insured against when the vessel was covered by a held covered clause.’

Lord Steyn Lord Hoffmann Lord Clyde Lord Hobhouse of Wood- borough Lord Scott of Foscote
Times 23-Jan-2001, [2001] 1 All ER 743, [2001] 2 WLR 170, [2001] UKHL 1, [2003] 1 AC 469
House of Lords, Bailii
Marine Insurance Act 1906 39(5) 35(2)
England and Wales
Citing:
Cited – Thomas v Tyne and Wear SS Freight Insurance Association 1917
For an insurer to set up a defence under claim for the loss of a ship on the grounds of the unseaworthiness of the vessel, the unseaworthiness must have been causative of the relevant loss. . .
Cited – Standard Oil Co of New York v Clan Line Steamers HL 1924
A ship sank with the entire loss of the cargo. The cargo owners sought damages from the owners, saying that the ship was unseaworthy. The ship was of an unusual construction, requiring a certain amount of water ballast to be mainatined for the ship . .
Cited – The Gloria 1935
‘I think that if it were shown that an owner had reason to believe that his ship was in fact unseaworthy, and deliberately refrained from an examination which would have turned his belief into knowledge, he might properly be held privy to the . .
Appeal from – Manifest Shipping Co Ltd v Uni-Polaris Shipping Co Ltd and Another CA 23-Jan-1997
The results which would follow from a fraudulent insurance claim should not to be extended similarly to follow from culpable non-disclosure in the absence of fraud. . .
Cited – Black King Shipping Corpn and Wayang (Panama) SA v Massie (The ‘Litsion Pride’) 1985
The LITSION PRIDE was insured against war risks. The terms required of her owners, notice as soon as practicable of her entry into specified war zones and then to pay an additional premium. The owners traded her into a war zone without giving . .

Cited by:
Cited – Agapitos and Another v Agnew and others CA 6-Mar-2002
Insurers resisted a claim saying that fraudulent acts of the defendants to promote an otherwise valid claim, made the entire claim void. The insurance required certificates to be obtained before ‘hot’ works were undertaken as part of the ship’s . .
Cited – Drake Insurance Plc v Provident Insurance Plc ComC 3-Feb-2003
A driver caused an accident, and the claimant insurance company paid out. It now sought a contribution from the defendant, who had also insured the driver, but had denied liability. The driver was a named additional driver under the second policy, . .
Cited – AXA General Insurance Limited v Gottlieb CA 11-Feb-2005
The defendant made a claim under an insurance policy. The insurer made an interim payment, but then asserted that the claim was fraudulent, and sought recovery of the interim payment.
Held: At common law, fraud in an insurance claim, once . .
Cited – Barlow Clowes International Ltd and Another v Eurotrust International Ltd and others PC 10-Oct-2005
(Court of Appeal of the Isle of Man) Defendants appealed a finding of dishonest assistance in the activities of Barlow Clowes.
Held: The judge had been able to reach the conclusions on the basis of the evidence. The appeal of the deemster . .
Cited – Meretz Investments Nv and Another v ACP Ltd and others ChD 30-Jan-2006
The applicant challenged the exercise of a power of sale under a mortgage, saying that the mortgagee’s purposes included purposes not those under the mortgage. The parties had been involved in an attempted development of a penthouse.
Held: The . .
Cited – Douglas and others v Hello! Ltd and others; similar HL 2-May-2007
In Douglas, the claimants said that the defendants had interfered with their contract to provide exclusive photographs of their wedding to a competing magazine, by arranging for a third party to infiltrate and take and sell unauthorised photographs. . .
Cited – Fairclough Homes Ltd v Summers SC 27-Jun-2012
The respondent had made a personal injury claim, but had then been discovered to have wildly and dishonestly exaggerated the damages claim. The defendant argued that the court should hand down some condign form of punishment, and appealed against . .
Cited – Versloot Dredging Bv and Another v Hdi Gerling Industrie Versicherung Ag and Others SC 20-Jul-2016
The ‘DC MERWESTONE’ suffered a water ingress of water flooding the engine room. This resulted from (i) the negligence of the crew in failing to close the sea inlet valve of the emergency fire pump and drain down the system, after they had used the . .
Cited – Willers v Joyce and Another (Re: Gubay (Deceased) No 1) SC 20-Jul-2016
Parties had been involved in an action for wrongful trading. This was not persisted with but the claimant sought damages saying that the action was only part of a campaign to do him harm. This appeal raised the question whether the tort of malicious . .

Lists of cited by and citing cases may be incomplete.

Insurance, Transport

Leading Case

Updated: 11 November 2021; Ref: scu.83379

Lexington Insurance Co v AGF Insurance Ltd: HL 30 Jul 2009

The respondent insurers had been held liable in Washington, and had been granted indemnity against the appellants by the Court of Appeal. The insurance contract had been under the law of Pennsylvania, but that of the re-insurance under the law of England and Wales.
Held: The claimant’s appeal succeeded. The re-insurance contract was governed by English law. If it was to be construed according to the law of another jurisdiction, that jurisdiction must have been capable of being identified at the time when the contract was made.

Lord Mance said: ‘a reinsurance is a separate contract, which may contain its own independent terms requiring to be satisfied before insurers can claim indemnity under it. To take an obvious example, the present reinsurance was not a perfectly proportional reinsurance, by virtue of the retention of $1,675,000. More fundamentally, even a perfectly proportional reinsurance is not an insurance against liability, still less against any liability which the reinsured may be held to incur under the insurance. ‘ and ‘ the reinsurance is an independent contract, with its own terms which fall to be construed under English law, and I see no basis for interpreting it as covering any liability which might subsequently be held to arise under the insurance in any State whose law might, after disputes had arisen under it and other separate insurances, be applied by reference to factors extraneous to the particular insurance to which alone the reinsurance related It follows that there is no basis for construing the two contracts as back to back in the present situation.’ and
‘under English law, a contract has a meaning which is to be ascertained at the time when it is concluded, having regard to its background and the surrounding circumstances within the parties’ knowledge at that time. ‘

Lord Phillips of Worth Matravers, Lord Walker of Gestingthorpe, Lord Brown of Eaton-under-Heywood, Lord Mance and Lord Collins of Mapesbury
[2009] UKHL 40, Times 13-Aug-2009, [2009] Bus LR 1452, [2009] 2 Lloyd’s Rep 508, [2010] 1 AC 180, [2009] 4 All ER 909, [2009] Lloyd’s Rep IR 675, [2009] 3 WLR 575, [2010] Env LR D1
Bailii
England and Wales
Citing:
Cited – British Dominions General Insurance Co Ltd v Duder KBD 1915
The court was asked whether the insurers, having settled the owners’ claim for a constructive total loss at 66 per cent. of the sum insured could recover 100 per cent. from their re-insurers. Bailhache J. held that they could, with the result that . .
Cited – Forsikringsaktieselskapt Vesta v Butcher HL 1988
A contract of insurance and a facultative reinsurance, under which part of the original risk was reinsured, contained warranties in identical terms.
Held: The warranty in the reinsurance policy, which was governed by English law, should be . .
Cited – Forsikringsaktieselskabet National (of Copenhagen) v Attorney-General HL 1925
Viscount Cave LC said that ‘by a contract of reinsurance the reinsuring party insures the original insuring party against the original loss.’ . .
Cited – Groupama Navigation Et Transports; Continent Sa; Mutuelles Du Mans; Zurich International France SA and Gie Generali Transports (Bodies Corporate) v V Catatumbo Seguros (a Body Corporate) CA 20-Jul-2000
. .
Cited – John Knight, William Ware And Others Against Faith And Another 23-Sep-1850
A ship, insured in 1000l. for a year ending 23rd September, was stranded, got off, and brought into the harbour of Sta. Cruz, on September 16th. She remained there with her crew on board till the middle of October, and, during that time, was pumped; . .
Cited – Municipal Mutual Insurance Limited v Sea Insurance Company Limited and Others CA 26-Mar-1998
The unifying event in an aggregation clause in an insurance policy was expressed in very general terms: ‘all occurrences of a series consequent on or attributable to one source or original cause.’
Held: As long as one could find any act, event . .
Cited – Hill and Others v Mercantile and General Reinsurance Co Plc; Berry and Others v Same HL 15-Aug-1996
Liability under reinsurance was not invalidated by a compromise including other claims. The parties to reinsurance contracts could set their own ways of proving the loss within a contract. A Full Reinsurance Clause is not binding in respect of any . .
Cited – Re London Marine Insurance Association 1869
. .
Cited – Joyce v Realm Marine Insurance Co 1872
The insurance covered (inter alia) cargo from ports in West Africa with outward cargo to be considered homeward interest 24 hours after the ship’s arrival at her first port of discharge. The reinsurance was at and from West African ports ‘to . .
Cited – Balfour v Beaumont 1984
. .
Cited – Youell and Others v Bland Welch and Co Ltd and Others CA 1992
The court considered whether an underwiter’s slip was admissible when construing the policy which followed.
Held: Staughton LJ said: ‘It is now, in my view, somewhat old-fashioned to approach such a problem armed with the parol evidence rule, . .
Cited – Bolton Metropolitan Borough Council v Municipal Mutual Insurance Ltd CA 6-Feb-2006
The deceased had come into contact with asbestos when working on building sites for more than one contractor. The claimant here sought contribution from the defendants for the damages it had paid to his estate. The issue was as to liability on . .
Cited – Whitworth Street Estates (Manchester) Ltd v James Miller and Partners Ltd CA 1969
The parties, one in England and one in Scotland agreed to perform certain actions in Scotland. Any dispute was to be settled by arbitration, but it was not said whether this would be in England or Scotland. The curial law of arbitration would decide . .
Cited – Compagnie Tunisienne de Navigation SA v Compagnie d’Armement Maritime SA HL 1970
The court considered what was the proper law of the contract. The inquiry must always be to discover the law with which the contract has the closest and most real connection. The mere fact that arbitration was to be in London did not mean that what . .
Cited – Whitworth Street Estates (Manchester) Ltd v James Miller and Partners Ltd HL 1970
The parties disagreed as to the curial law of an arbitration agreement. The proper law of the building contract and the arbitration agreement was English but the reference was conducted in Scotland.
Held: Evidence of behaviour after a contract . .
Cited – The Iran Vojdan 1984
Electric cable was carried on an Iranian flagged vessel from Hamburg to Dubai. The plaintiff consignees, alleging that the cargo was damaged, commenced proceedings against the shipowners in the English courts. The defendants sought a stay on saying . .
Cited – Amin Rasheed Shipping Corp v Kuwait Insurance Co HL 1983
A claimant must show good reason why service on a foreign defendant should be permitted. This head of jurisdiction was an exorbitant jurisdiction, one which, under general English conflict rules, an English court would not recognise as possessed by . .
Cited – Charter Reinsurance Co Ltd v Fagan and Others HL 24-May-1996
The re-insurers appealed against a finding that they were liable to make payment under a contract which required them to pay ‘sums actually paid.’ They said that the company having become insolvent, no payment would in fact be made.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Insurance, International

Updated: 11 November 2021; Ref: scu.368927

Pratt v Aigaion Insurance Company SA (‘the Resolute’): CA 27 Nov 2008

The court considered the interpretation of a term in a contract of insurance to the effect that ‘Warranted Owner and/or Owner’s experienced skipper on board and in charge at all times and one experienced crew member.’, asking whether ‘at all times’ meant 24 hours a day.
Held: The owner’s appeal succeeded. If underwriters wish to have a warranty with draconian consequences they must stipulate for it in clear terms. The clause should be construed contra proferentem, that is against the insurer. Other cases on different clauses were not necessarily good guidance. The principal purpose of the clause was to protect the vessel when two experienced crew members were on board, namely at times when she was manoeuvering. ‘At the time the crew left, the vessel was safely tied up alongside, as must happen very often. Sometimes, no doubt, the generator was left running and sometimes it was not. If the insurer wanted the owner or skipper and an experienced crew member on board whenever the vessel was left with the generator still running it should clearly have so provided. So too, if the insurer wanted them on board whenever the vessel was left, it should clearly have so stipulated. It did not.’

CLarke MR, Maurice Kay LJ, Stanley Burnton LJ
[2008] EWCA Civ 1314, Times 03-Dec-2008, [2009] Lloyd’s Rep IR 149, [2008] 2 CLC 756, [2009] 2 All ER (Comm) 387, [2009] 1 Lloyd’s Rep 225
Bailii
England and Wales
Citing:
Cited – F L Schuler AG v Wickman Machine Tools Sales Limited HL 4-Apr-1973
The parties entered an agreement to distribute and sell goods in the UK. They disagreed as to the meaning of a term governing the termination of the distributorship.
Held: The court can not take into account the post-contractual conduct or . .
Cited – Antaios Compania Naviera SA v Salen Rederierna AB (‘the Antaios’) HL 1984
A ship charterer discovered that the bills of lading were incorrect, but delayed withdrawal from the charter for 13 days. They now sought leave to appeal the arbitration award against them.
Held: Though he deprecated extending the use of the . .
Cited – Charter Reinsurance Co Ltd v Fagan and Others HL 24-May-1996
The re-insurers appealed against a finding that they were liable to make payment under a contract which required them to pay ‘sums actually paid.’ They said that the company having become insolvent, no payment would in fact be made.
Held: The . .
Cited – Investors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
Cited – Brownsville Holdings Ltd v Adamjee Insurance Co Ltd (‘The Milasan’) 2000
A 90 foot motor yacht sank in calm weather in the course of a voyage from Piraeus to Sardinia with a crew of three: a skipper, an engineer and a deckhand.
Held: The owner’s insurance claim failed. There had been a breach of warranty in these . .
Cited – Sirius International Insurance Company (Publ) v FAI General Insurance Limited and others HL 2-Dec-2004
The appellant had taken certain insurance risks on behalf of the respondents, subject to banking indemnities. Disputes arose and were settled under a Tomlin order, which was now itself subject to challenge.
Held: The appeal was allowed. The . .
Cited – Bank of Credit and Commerce International SA v Ali, Khan and others (No 1); BCCI v Ali HL 1-Mar-2001
Cere Needed Releasing Future Claims
A compromise agreement which appeared to claim to settle all outstanding claims between the employee and employer, did not prevent the employee later claiming for stigma losses where, at the time of the agreement, the circumstances which might lead . .
Cited – GE Frankona Reinsurance Ltd v CMM Trust No.1400 (the ‘Newfoundland Explorer’) AdCt 22-Mar-2006
The owner sought to claim under his insurance policy. The yacht was, in the policy warranted to be fully crewed at all times. The owner had left the boat to return a few hours later when it was found on fire.
Held: The insurance claim failed. . .

Cited by:
Cited – Horwood and Others v Land of Leather Ltd and Others ComC 18-Mar-2010
The claimants sought to claim for personal injuries against the defendant company, now in administration, and their insurers using the 1930 Act. The insurers said they were not liable to indemnify the company. The parties disputed the standing of an . .
Cited – AC Ward and Son v Catlin (Five) Ltd and Others CA 10-Sep-2009
The defendant insurers appealed against refusal of summary judgment in its favour in defending a claim under a policy. The claimants premises had been burgled. The insurer said that the claimant had failed to respect warranties given by it as to . .

Lists of cited by and citing cases may be incomplete.

Insurance, Transport

Updated: 11 November 2021; Ref: scu.278301

Dalamd Ltd v Butterworth Spengler Commercial Ltd: ComC 5 Oct 2018

Conflicting Insurance Policies – Disclosure Error

An assured operated a waste recycling facility. It held two relevant polices of insurance, with different insurers. The insurers both claimed that they were entitled to avoid the relevant policies for material non-disclosure. The assured, and the lessor of the premises, which was a co-insured under the first of the policies, assigned their causes of action to the claimant, which sued the defendant insurance broker in negligence. The broker was held liable for failing to give the assured adequate advice about its disclosure obligations and failing to disclose to the insurer material facts known to it. However, the assured could only recover damages in respect of one of the policies. In respect of other policy, the defendant’s negligence was not causative of the assured’s loss, because it had not affected the lessor’s claim under the policy. Furthermore, on a balance of probabilities, that policy would in any event not have responded by reason of a breach of condition, for which the broker was not responsible.

Butcher J
[2018] EWHC 2558 (Comm)
Bailii, Judiciary
England and Wales

Insurance

Updated: 10 November 2021; Ref: scu.625935

Reilly v National Insurance and Guarantee Corporation Ltd: CA 19 Dec 2008

The claimant sold fire extinguishers. Three failed, resulting in damage to the purchaser’s properties. His insurers refused to pay an indemnity saying that the failure was the failure of a piece of machinery (the switchgear) and was not covered by the policy. He appealed against a decision supporting the insurers.
Held: The court re-iterated the principles of construing contracts: ‘a presumption that the words in question should be construed in their ordinary and popular sense; that a commercial document, such as an insurance policy, should be construed in accordance with sound commercial principles and good business sense; that the commercial object of the contract as a whole, or the particular clause in question, will be relevant in resolving any ambiguity in the wording; and that in a case of true ambiguity, the construction which produces the more reasonable result is to be preferred. I would only add by way of comment that difficulty of construction is not the same thing as ambiguity.’ The endorsement was not limited to fire and intruder alarms and any switchgear, control panels and machinery associated with them. The word ‘machinery’ is capable of encompassing a wide range of devices which operate by means of physical movement to perform a particular function. On this basis, the failure of a piston would be a failure of machinery, but a failure in pressure of the master cylinder would not.

Sir Anthony May PQBD, Thomas LJ, Moore-Bick LJ
[2008] EWCA Civ 1460, [2009] Lloyd’s Rep IR 488, [2009] 1 All ER (Comm) 1166
Bailii
England and Wales
Citing:
Appeal from – Reilly v National Insurance and Guarantee Corporation Ltd ComC 11-Apr-2008
. .
Cited – Absalom v TCRU Ltd CA 19-Dec-2005
Longmore LJ discussed the construction of a contract: ‘(i) the aim of the exercise is to ascertain the meaning of the relevant contractual language in the context of the document and against the background to the document. The object of the enquiry . .
Cited – The ‘Arsa’ 1925
The court considered whether an outlet valve in the hull of a shape amounted to ‘machinery’. . .
Cited – Aktion Maritime Corporation of Liberia v S Kasmas and Brothers Ltd 1987
The parties contracted for the sale of a ship under the Norwegian sale form. The court considered whether the contract was properly cancelled and or novated and whether an anti-corrosion system forming part of the hull was machinery within a . .
Cited – Antaios Compania Naviera SA v Salen Rederierna AB (‘the Antaios’) HL 1984
A ship charterer discovered that the bills of lading were incorrect, but delayed withdrawal from the charter for 13 days. They now sought leave to appeal the arbitration award against them.
Held: Though he deprecated extending the use of the . .
Cited – Lovelidge v Anselm Odling and Sons Ltd 1967
The court was asked whether a flexible revolving drive shaft was ‘machinery’.
Held: A drive shaft connecting an electric motor to a cutting wheel could itself constitute machinery. . .

Lists of cited by and citing cases may be incomplete.

Insurance, Contract

Updated: 10 November 2021; Ref: scu.278984

Foskett v McKeown and Others: HL 18 May 2000

A property developer using monies which he held on trust to carry out a development instead had mixed those monies with his own in his bank account, and subsequently used those mixed monies to pay premiums on a life assurance policy on his own life, vested in trustees for his children. After his death, the life assurance company paid out on the policy. The beneficiaries of the development monies trust made a proprietary claim to a share in the monies paid out by the life assurance company.
Two groups of innocent parties disputed the rights to a death benefit of about 1m pounds paid by insurers pursuant to a whole life policy. A trustee had misappropriated trust funds and used them in part to pay premiums on life insurance policies for the benefit of his own children.
Held: The misappropriated funds could be traced through the insurance policies into the hands of the beneficiaries of the policies. Where part of the premiums had been paid properly, a mixed fund, akin to a bank account, was created, and the interest was according to the proportions. The interest was a property interest in the fund, and the court had no discretion as to its distribution. There is no rule in English law that in the case of a mixed substitution the beneficiary is confined to a lien. ‘Where a trustee wrongfully uses trust money to provide part of the cost of acquiring an asset, the beneficiary is entitled at his option either to claim a proportionate share of the asset or to enforce a lien upon it to secure his personal claim against the trustee for the amount of the misapplied money. It does not matter whether the trustee mixed the trust money with his own in a single fund before using it to acquire the asset, or made separate payments (whether simultaneously or sequentially) out of the differently owned funds to acquire a single asset.’
Lord Millett said: ‘Following is the process of following the same asset as it moves from hand to hand. Tracing is the process of identifying a new asset as the substitute for the old. Where one asset is exchanged for another, a claimant can elect whether to follow the original asset into the hands of the new owner or to trace its value into the new asset in the hands of the same owner . . Tracing is thus neither a claim nor a remedy. It is merely the process by which a claimant demonstrates what has happened to his property, identifies its proceeds and the persons who have handled or received them, and justifies his claim that the proceeds can properly be regarded as representing his property. Tracing is also distinct from claiming. It identifies the traceable proceeds of the claimants’ property. It enables the claimant to substitute the traceable proceeds for the original asset as the subject matter of his claim. But it does not affect or establish his claim.’
Lord Millett set out the distinction between a claim to enforce property right and a case of unjust enrichment: ‘A plaintiff who brings an action in unjust enrichment must show that the defendant has been enriched at the plaintiff’s expense, for he cannot have been unjustly enriched if he has not been enriched at all. But the plaintiff is not concerned to show that the defendant is in receipt of property belonging beneficially to the plaintiff or its traceable proceeds. The fact that the beneficial ownership of the property has passed to the defendant provides no defence; indeed, it is usually the very fact which founds the claim. Conversely, a plaintiff who brings an action like the present must show that the defendant is in receipt of property which belongs beneficially to him or its traceable proceeds, but he need not show that the defendant has been enriched by its receipt. He may, for example, have paid full value for the property, but he is still required to disgorge it if he received it with notice of the plaintiff’s interest.’
Lord Steyn said: ‘In truth tracing is a process of identifying assets: it belongs to the realm of evidence. It tells us nothing about legal or equitable rights to the assets traced.’

Lord Browne-Wilkinson, Lord Steyn, Lord Hoffmann, Lord Hope of Craighead, Lord Millett
Times 24-May-2000, Gazette 08-Jun-2000, [2000] UKHL 29, [2000] 3 All ER 97, [2000] Lloyd’s Rep IR 627, [2001] 1 AC 102, [2000] WTLR 667, (1999-2000) 2 ITELR 711, [2000] 2 WLR 1299
House of Lords, Bailii
England and Wales
Citing:
Cited – In re Diplock’s estate CA 1948
After considering a situation in which trust money had been applied in making alterations to the property of an innocent third party but had not added to the value of the property,
Held: The origin of the equitable rules of tracing were . .
Appeal from – Foskett v McKeown and Others CA 27-Jun-1997
Various people had paid money with the promise of acquiring an interest in land in Portugal. The scheme was fraudulent. The funds had been used to purchase a life/investment policy. The policy was held in trust for the fraudster’s mother but he had . .
Cited – In re Leslie; Leslie v French ChD 1883
The court gave guidance as to the circumstances in which an individual who had paid a premium on a policy belonging to someone else could claim an interest in the policy: ‘In my opinion a lien may be created upon the moneys secured by a policy by . .
Cited – In re Tilley’s Will Trusts ChD 1967
The court considered the rights of a beneficiary to participate in any profit which resulted where a trustee mixed trust money with his own money and then used it to purchase other property. . .
Cited – Scottish Co-operative Wholesale Society Ltd v Meyer HL 1959
Valuation of Shares on Order for Purchase
The Co-operative Society had formed a 51 per cent-owned subsidiary to manufacture rayon at a time of strict post-war controls. The other shares were owned by two outside directors with skill and experience in the trade. When these directors declined . .
Cited – Falcke v Scottish Imperial Insurance Co CA 1886
The owner of a policy of life assurance mortgaged the policy to secure repayment of a loan. Subsequently the owner, now the owner of an equity of redemption in the policy, paid two annual premiums which became due under the policy. The policy was . .
Cited – D’Avigdor-Goldsmid v Inland Revenue Commisioners HL 1953
A contingency which makes money payable under a chose cannot affect the proprietary interests in the chose in action and therefore in its proceeds. No fresh beneficial interest in a policy of life assurance accrues or arises on the death of the life . .
Cited – Sandeman and Sons v Tyzack and Branfoot Steamship Co Ltd HL 1913
The House described the doctrines of English law which are applicable to cases where goods belonging to different owners have become mixed so as to be incapable of either being distinguished or separated: ‘If the mixing has arisen from the fault of . .
Cited – Edinburgh Corporation v Lord Advocate HL 1879
Competing claims to a mixed fund were resolved by the application of equitable principles. Funds had been contributed by a benefactor of a hospital for particular trust purposes and had for more than 170 years been held, administered and applied as . .
Cited – Trustee of the Property of F C Jones and Sons (A Firm) v Jones CA 13-May-1996
A bankruptcy order was made in 1984. Under the 1914 Act the trustee in bankruptcy got title to all the assets of the bankrupt as of the date of the act of bankruptcy. So, the trustee owned the partnership assets. The wife drew andpound;11,700 out of . .
Cited – El Ajou v Dollar Land Holdings Plc ChD 1995
The tracing of assets into the hands of a third party depends upon a notional charge. There are no inflexible rules. The essential elements of ‘knowing receipt’ are: ‘For this purpose the plaintiff must show, first, a disposal of his assets in . .
Cited – Magistrates of Edinburgh v McLaren HL 1881
. .
Disapproved – In re Hallett’s Estate; Knatchbull v Hallett CA 1880
Where a trustee of a policy used money received from others to make payment of premiums on an insurance policy, they would be entitled to a lien on the policy. Where an asset was acquired exclusively with trust money, the beneficiary could either . .
Cited – Lupton v White 19-Dec-1808
Whatever alteration of form any property may undergo, the true owner is entitled to seize it in its new shape if he can prove the identity of the original material. . .
Cited – Jones v De Marchant 1916
A husband wrongfully used 18 beaver skins belonging to his wife together with four skins of his own, to have a fur coat made up which he then gave to his mistress. The wife was held entitled to recover the coat. The mistress knew nothing of the true . .
Cited – Frith v Cartland 1865
‘. . . If a man mixes trust funds with his own, the whole will be treated as the trust property, except so far as he may be able to distinguish what is his own.’ . .

Cited by:
Appealed to – Foskett v McKeown and Others CA 27-Jun-1997
Various people had paid money with the promise of acquiring an interest in land in Portugal. The scheme was fraudulent. The funds had been used to purchase a life/investment policy. The policy was held in trust for the fraudster’s mother but he had . .
Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Clark v Cutland CA 18-Jun-2003
One director discovered that his co-director had withdrawn substantial sums from the company. . .
Cited – Bank of Cyprus UK Ltd v Menelaou SC 4-Nov-2015
The bank customers, now appellants, redeemed a mortgage over their property, and the property was transferred to family members, who in turn borrowed from the same lender. A bank employee simply changed the name on the mortgage. This was ineffective . .
Cited – Scott v Bridge and Others ChD 25-Nov-2020
Claim to recover money and property said to have been transferred by the claimant to the defendants or one or more of them. The money concerned came from a bank account belonging to the claimant. The property concerned consisted of two . .

Lists of cited by and citing cases may be incomplete.

Insurance, Equity, Trusts

Leading Case

Updated: 10 November 2021; Ref: scu.80646

AIG Europe Ltd v OC320301 Llp and Others: CA 14 Apr 2016

‘This appeal turns on the true construction of an aggregation clause contained in an insurance policy applicable to all solicitors’ indemnity policies pursuant to the requirement in the Solicitors’ Act 1974 for compulsory liability insurance for solicitors and the Minimum Terms and Conditions (‘MTC’) required to be incorporated into such polices.’
Held: Teare J went too far in saying that the transactions had to be dependent on each other. It accepted a submission for the Law Society as an intervener, that there must be an ‘intrinsic’ relationship between the transactions rather than a relationship with some outside connecting factor, even if that factor was common to the transactions. If the relevant transaction was the payment of money out of an escrow account, which should not have been paid out of that account, what would be ‘intrinsic’ would depend on the circumstances of that payment. The court summarised its interpretation, at para 33, by saying that ‘the true construction of the words ‘in a series of matters or transactions’ is that the matters or transactions have to have an intrinsic relationship with each other, not an extrinsic relationship with a third factor.’ It allowed the appeal and remitted the action to the Commercial Court to determine in accordance with the guidance in its judgment.

Longmore, Kitchin, Vos LJJ
[2016] EWCA Civ 367, [2016] Lloyd’s Rep IR 289, [2017] 1 All ER 143, [2016] 2 All ER (Comm) 1058
Bailii
Solicitors’ Act 1974
England and Wales
Citing:
Appeal From – AIG Europe Ltd v OC320301 Llp and Others ComC 14-Aug-2015
The Claimants, AIG Europe Limited, seeks a declaration that certain claims brought by many individuals against a firm of solicitors are to be aggregated and thus considered a single claim for the purposes of a claim brought by the firm of solicitors . .

Cited by:
Cited – AIG Europe Ltd v Woodman and Others SC 22-Mar-2017
The parties disputed the effect of a clause aggregating claims for the purposes of limiting an insurer’s liability under professional negligence insurance.
Held: the claims of each group of investors arise from acts or omissions in a series of . .

Lists of cited by and citing cases may be incomplete.

Legal Professions, Insurance

Updated: 10 November 2021; Ref: scu.562146

Digital Satellite Warranty Cover Ltd and Another v Financial Services Authority: SC 13 Feb 2013

The appellants challenged an order for the dissolution of their company under the 2000 Acts. They had provided warranties for assorted consumer electrical goods which amounted to insurance, but said that they were not required to be registered under the Act since only services in kind were ever provided.
Held: The appeal failed. The fact that certain activities were to be regulated under European law did not prevent the regulation of other associated areas, in this case the issuing of insurance by provision of goods and services only. These were contracts of insurance, and the appellants were not registered.
The First Council Directive had not been intended to be comprehensive, and the list of businesses it scheduled did not restrict the capacity to regulate other actiities. This was acknowledged in its recitals.
The common law which restricted contracts of insurance to those where the detriment suffered by the insurer was strictly financial was displaced by the reuirement to construe UK law to conform with EU law.

Lord Neuberger, President, Lady Hale, Lord Mance, Lord Clarke, Lord Sumption
[2013] 1 WLR 605, [2013] UKSC 7
Bailii
Financial Services and Markets Act 2000, cial Services and Markets Act 2000 (Regulated Activities) Order 2001, First Council Directive 73/239/EEC
England and Wales
Citing:
Cited – Phoenix General Insurance Co of Greece SA v Halvanon Insurance Co Ltd ChD 1985
The court was asked to consider preliminary issues concerning facultative obligatory (fac. oblig.) reinsurances of a variety of business. The issues included whether the reinsured was obliged to keep a retention and whether the writing of its . .
At First Instance – Re Digital Satellite Warranty Cover Ltd and Others ChD 31-Jan-2011
The Financial Services Authority sought public interest orders for the winding up of three companies selling, it said, extended warranty cover plans without authorisation. The companies said that authorisation was not required, since only services . .
Appeal from – Digital Satellite Warranty Cover Ltd v The Financial Services Authority CA 29-Nov-2011
Parties appealed against on order for the winding up of the company. The Authority (FSA) had said that the company which supplied warranties to owners of digital receiver boxes were providing regulated insurance services, but that the companies were . .
Cited – Prudential Insurance Co v Inland Revenue Commissioners 1904
Contract for payment of sum on event
The Insurance company provided endowment insurance polices. They disagreed with the Commissioners as to whether these were policies of insurance and thus as to how they fell to be stamped. Life insurance was defined in the 1891 Act as ‘insurance . .
Cited – Department of Trade and Industry v St Christopher Motorists Association Ltd 1974
The defendant company provided for the hire of a chauffeur if the insured was disqualified from driving.
Held: Contracts of insurance are not confined to contracts for the payment of money, but may include a contract for some benefit . .
Cited – Phoenix General Insurance Co of Greece SA v Halvanon Insurance Co Ltd CA 1987
Kerr LJ summarised the aim of the Directives underlying the 1977 Regulations as being to achieve a uniform classification of non-life insurance businesses and of insured risks for the purposes of the supervision of insurers with a view to ensuring . .
Cited – Marleasing SA v La Comercial Internacional de Alimentacion SA ECJ 13-Nov-1990
Sympathetic construction of national legislation
LMA OVIEDO sought a declaration that the contracts setting up Commercial International were void (a nullity) since they had been drawn up in order to defraud creditors. Commercial International relied on an EC . .

Lists of cited by and citing cases may be incomplete.

Financial Services, European, Insurance

Leading Case

Updated: 10 November 2021; Ref: scu.470946

MacCaferri Ltd v Zurich Insurance Plc: ComC 19 Jun 2015

maccafferiCoC201506

The claimant manufacturer challenged a refusal of indemnity from his insurers, the defendants under its product liability policy. An end user consumer had been injured. The insurer said that the claimant had delayed on notifying the possible claim.
Held: The claim succeeded: ‘the likelihood of a claim cannot simply be inferred from the happening of an accident’ and ‘when the accident occurred, there was not at least a fifty per cent chance that a claim against the Claimant would eventuate. There had been an accident. The gun was involved. It was a possibility, but not more, that the accident involved a fault in the gun. But there were other possibilities: a fault in the way in which the gun was used, or no fault at all.’

Knowles CBE J
[2015] EWHC 1708 (Comm)
Bailii
Citing:
Cited – Layher Ltd v Lowe and Others CA 8-Jan-1997
The insurers became insolvent, and re-insurers sought to escape liability saying that no sums had been paid out to trigger the re-insurer’s liability.
Held: Re-Insurers were liable under a policy requiring them to pay out on sums paid out by . .
Cited – Verelst’s Administratrix v Motor Cross Union Insurance Company Limited 1925
The insured was killed in a motor accident in India on 14 January 1923. Knowledge of her death reached her personal representative in England within a month, but the personal representative did not know of the existence of the insurance policy until . .
Cited – Jacobs v Coster, Avon Insurance CA 25-Jan-1999
. .

Lists of cited by and citing cases may be incomplete.

Insurance

Updated: 09 November 2021; Ref: scu.549251

Motor Oil Hellas (Corinth) Refineries SA v Shipping Corporation of India (The Kanchenjunga): HL 1990

A ship was caught in harbour when an air raid broke out. The master took the ship to sea where it suffered damage.
Held: The shipowners were protected by a war risks clause in the charterparty agreement. As to waiver by election, Lord Goff of Chieveley said: ‘In the present case, we are concerned with an election which may arise in the context of a binding contract, when a state of affairs comes into existence in which one party becomes entitled, either under the terms of the contract or by the general law, to exercise a right, and he has to decide whether or not to do so. His decision, being a matter of choice for him, is called in law an election. Characteristically, this state of affairs arises where the other party has repudiated the contract or has otherwise committed a breach of the contract which entitles the innocent party to bring it to an end, or has made a tender of performance which does not conform to the terms of the contract. .
In all cases, he has in the end to make his election, not as a matter of obligation, but in the sense that, if he does not do so, the time may come when the law takes the decision out of his hands, either by holding him to have elected not to exercise the right which has become available to him, or sometimes by holding him to have elected to exercise it. Instances of this phenomenon are to be found in s. 35 of the Sale of Goods Act 1979. In particular, where with knowledge of the relevant facts a party has acted in a manner which is consistent only with his having chosen one of the two alternative and inconsistent courses of action then open to him – for example, to determine a contract or alternatively to affirm it – he is held to have made his election accordingly . . perhaps because a party who elects not to exercise a right which has become available to him is abandoning that right, he will only be held to have done so if he has so communicated his election to the other party in clear and unequivocal terms Moreover, it does not require consideration to support it, and so it is to be distinguished from an express or implied agreement, such as a variation of the relevant contract, which traditionally requires consideration to render it binding in English Law.’

Lord Goff of Chieveley
Times 19-Feb-1990, [1990] CLY 4077, [1990] 1 Lloyds Rep 391
Sale of Goods Act 1979 35
England and Wales
Cited by:
Cited – Oliver Ashworth (Holdings) Limited v Ballard (Kent) Limited CA 18-Mar-1999
In order for the landlord to claim double rent where a tenant held over unlawfully after the tenancy was determined, the landlord must not do anything to indicate that the lease might be continuing, for example by denying the validity of break . .
Cited – Peregrine Systems Ltd v Steria Ltd CA 14-Mar-2005
The claimant provided computer software to the defendants. The defendants appealed dismissal of their defences arguing that the system had failed.
Held: No repudiatory breach was established, and moreover Steria had elected to affirm the . .
Cited – Stocznia Gdynia Sa v Gearbulk Holdings Ltd CA 13-Feb-2009
Orders were placed for the construction of ships. They were not delivered. The buyer, the defendant, cancelled the orders. The defendants sought the loss of profit. The claimants said they were entitled only to the repayment of instalments. The . .
Cited – Wheatley, Smith As Executors of Henry Thomas Cadbury-Brown v King LRA 30-Nov-2011
LRA Estoppel – Exercise of options – whether defect waived – ‘The Kanchenjunga’ [1990] Lloyds Law Reports 391 – Peyman v Lanjani [1985] 1 Ch 457, HIH Casualty and General Insurance Ltd v AXA Corporate Solutions . .
Explained – Tele2 International Card Company Sa and others v Post Office Ltd CA 21-Jan-2009
Appeal against rejection of claim for novation of contract.
Held: Aikens LJ summarised the analysis by Lord Goff of the principles of affirmation by election in Kanchenjunga as follows: ‘i) If a contract gives a party a right to terminate upon . .
Cited – Force India Formula One Team Ltd v 1 Malaysia Racing Team Sdn Bhd and Others ChD 21-Mar-2012
The claimants alleged misuse by the defendants of confidential information.
Held: Arnold J said: ‘Confidential information is not property, however, even though businessmen often deal with confidential information as if it were property and . .

Lists of cited by and citing cases may be incomplete.

Insurance, Contract, Equity

Leading Case

Updated: 09 November 2021; Ref: scu.188152

Macaura v Northern Assurance Company Limited: HL 1925

Macaura owned the large majority of shares in a limited company, trading in timber. The company also owed him substantial sums. He kept on the insurance of timber and other assets within the business but in his own name. When he came to claim, his claim was refused by the insurers.
Held: His appeal failed. An insurable interest in property could only arise where the insured held a legal or equitable interest in the insured property.
Neither a shareholder nor a simple creditor of a company had any insurable interest in any particular asset of the company because as such he had no legal or equitable interest in it.
Lord Buckmaster said: ‘Turning now to his position as shareholder, this must be independent of the extent of his share interest. If he were entitled to insure holding all the shares in the company, each shareholder would be equally entitled, if the shares were all in separate hands. Now, no shareholder has any right to any item of property owned by the company, for he has no legal or equitable interest therein. He is entitled to a share in the profits while the company continues to carry on business and a share in the distribution of the surplus assets when the company is wound up. If he were at liberty to effect an insurance against loss by fire of any item of the company’s property, the extent of his insurable interest could only be measured by determining the extent to which his share in the ultimate distribution would be diminished by the loss of the asset – a calculation almost impossible to make. There is no means by which such an interest can be definitely measured and no standard which can be fixed of the loss against which the contract of insurance could be regarded as an indemnity . . In the present case, though it might be regarded as a moral certainty that the appellant would suffer loss if the timber which constituted the sole asset of the company were destroyed by fire, this moral certainty becomes dissipated and lost if the asset be regarded as only one in an innumerable number of items in a company’s assets and the shareholding interest be spread over a large number of individual shareholders.’ and ‘No shareholder has any right to any item of property owned by the company, for he has no legal or equitable interest therein. He is entitled to a share in the profits while the company continues to carry on business and a share in the distribution of the surplus assets when the company is wound up.’
Lord Sumner also said that the appellant had no insurable interest: ‘It is clear that the appellant had no insurable interest in the timber described . . He had no lien or security over it and, though it lay on his land by his permission, he had no responsibility to its owner for its safety, nor was it there under any contract that enabled him to hold it for his debt. He owned almost all the shares in the company, and the company owed him a good deal of money, but, neither as creditor nor as shareholder, could he insure the company’s assets. The debt was not exposed to fire nor were the shares, and the fact that he was virtually the company’s only creditor, while the timber was its only asset, seems to me to make no difference. He stood in no ‘legal or equitable relation to’ the timber at all. He had no ‘concern in’ the subject insured. His relation was to the company, not its goods, and after the fire he was directly prejudiced by the paucity of the company’s assets, not by the fire.’
Lord Wrenbury said: ‘My Lords, this appeal may be disposed of by saying that the corporator even if he holds all the shares is not the corporation, and that neither he nor any creditor of the company has any property legal or equitable in the assets of the corporation.’

Lord Buckmaster, Lord Wrenbury, Lord Sumner
[1925] AC 619, (1925) 133 LT 152, [1925] All ER 51, [1925] AC 619, [1925] All ER Rep 51, 94 LJPC 154, 133 LT 152, 41 TLR 447, 69 Sol Jo 777, 31 Com Cas 10 HL
England and Wales
Cited by:
Distinguished – Sharp v Sphere Drake Insurance plc (The Moonacre) 1992
S, a retired businessman, had bought a vessel and insured it in his name, but registered it in the name of company, R. In the winter, the boat was laid up, but occupied by a workman who maintained it and kept it secure. The boat was destroyed by a . .
Cited – Feasey v Sun Life Assurance Company of Canada and Another: Steamship Mutual Underwriting Association (Bermuda) Ltd v Feasey ComC 17-May-2002
The fact that there was more than one insurance policy in place for the same interest would not preclude a claim under one of them. A mutual underwriting group insured members against personal injury and so forth through ‘lineslip’ policies. The . .
Cited – Ben Hashem v Ali Shayif and Another FD 22-Sep-2008
The court was asked to pierce the veil of incorporation of a company in the course of ancillary relief proceedings in a divorce. H had failed to co-operate with the court.
After a comprehensive review of all the authorities, Munby J said: ‘The . .

Lists of cited by and citing cases may be incomplete.

Insurance, Company

Leading Case

Updated: 09 November 2021; Ref: scu.184482

Rhesa Shipping Co SA v Edmonds (The Popi M): HL 16 May 1985

The Popi M sank in calm seas and fair weather as a result of a large and sudden entry of water into her engine room through her shell plating. The vessel’s owners claimed against her hull and machinery underwriters, contending that the loss was caused by a peril of the sea or alternatively by crew negligence. The suggested peril of the sea was a moving submerged object, i.e. a submarine. The underwriters contended that the vessel was not seaworthy. More specifically, the underwriters advanced a mechanism for unseaworthiness through wear and tear, based on expert metallurgical evidence. The judge rejected that theory. He also rejected the owners’ argument that there had been crew negligence. That left the possibilities that the vessel was in some other way unseaworthy or that it collided with a submarine. There was no clear basis upon for the court to say that burden of proof had been discharged.
Held: The burden of proving this, on a balance of probabilities, lay on the plaintiffs. A trial judge is not bound to accept the evidence of one side or the other: there remains the possibility of deciding the case on the burden of proof. The court should avoid deciding cases on a balance of improbabilities. It was not possible to proceed on the basis of eliminating the impossible and deciding that the remaining explanation, however improbable, must be the cause, unless all the relevant facts were known; that state of affairs did not exist, as the ship had sunk in deep water. The concept of proof on a balance of probabilities had to be applied with common sense. It required a judge, before he found a particular event occurred, to be satisfied on the evidence that it was more likely to have occurred than not.
(1) where the cause of a past event is in issue and two or more competing causes are advanced the burden of proving his case on causation remains on the claimant throughout, and though the defendant can advance a competing cause there is no obligation on him to prove this case.
(2) Even after a prolonged enquiry with a mass of expert evidence, it is open to the courts to conclude that causation remains in doubt and the result will be that the claimant has failed to discharge the burden of proof.
(3) Therefore the effect of this decision is that where the court considers one theory as improbable but also rules out all other theories the court should not treat the improbable theory as the likely cause of the event.
Lord Brandon of Oakbrook said: ‘the appeal does not raise any question of law, except possibly the question what is meant by proof of a case ‘on a balance of probabilities’. Nor do underwriters challenge . . any of the primary findings of fact made by Bingham J. The question, and the sole question, which your Lordships have to decide is whether on the basis of those primary findings of fact, Bingham J and the Court of Appeal were justified in drawing the inference that the ship was, on the balance of probabilities, lost by perils of the sea.
In approaching this question it is important that two matters should be borne constantly in mind. The first matter is that the burden of proving, on a balance of probabilities, that the ship was lost by perils of the seas is and remains throughout on the shipowners. Although it is open to the underwriters to suggest and seek to prove some other cause of loss, against which the ship was not insured, there is no obligation on them to do so. Moreover, if they chose to do so, there is no obligation on them to prove, even on a balance of probabilities, the truth of their alternative case.
The second matter is that it is always open to a court, even after the kind of prolonged inquiry with a mass of expert evidence which took place in this case, to conclude, at the end of the day, that the proximate cause of the ship’s loss, even on a balance of probabilities, remains in doubt, with the consequence that the shipowners have failed to discharge the burden of proof which lay on them.’
As to the Sherlock Holmes fallacy that ‘once you have eliminated the impossible, whatever remains, however improbable, is the truth ‘: ‘In my view there are three reasons why it is inappropriate to apply the dictum of Mr. Sherlock Holmes, to which I have just referred, to the process of fact-finding which a Judge of first instance has to perform at the conclusion of a case of the kind here concerned.
The first reason is one which I have already sought to emphasize as being of great importance, namely, that the Judge is not bound always to make a finding one way or the other with regard to the facts averred by the parties. He has open to him the third alternative of saying that the party on whom the burden of proof lies in relation to any averment made by him has failed to discharge that burden. No judge likes to decide cases on burden of proof if he can legitimately avoid having to do so. There are cases, however, in which, owing to the unsatisfactory state of the evidence or otherwise, deciding on the burden of proof is the only just course for him to take.
The second reason is that the dictum can only apply when all relevant facts are known, so that all possible explanations, except a single extremely improbable one, can properly be eliminated.
The third reason is that the legal concept of proof of a case on a balance of probabilities must be applied with common sense. It requires a judge of first instance, before he finds that a particular event occurred, to be satisfied on the evidence that it is more likely to have occurred than not. If such a Judge concludes, on a whole series of cogent grounds, that the occurrence of an event is extremely improbable, a finding by him that it is nevertheless more likely to have occurred than not, does not accord with common sense. This is especially so when it is open to the Judge to say simply that the evidence leaves him in doubt whether the event occurred or not, and that the party on whom the burden of proving that the event occurred lies has therefore failed to discharge such burden.

In my opinion Bingham J adopted an erroneous approach to this case by regarding himself as compelled to choose between two theories, both of which he regarded as extremely improbable, or one of which he regarded as extremely improbable and the other of which he regarded as virtually impossible. He should have borne in mind, and considered carefully in his judgment, the third alternative which was open to him, namely, that the evidence left him in doubt as to the cause of the aperture in the ship’s hull, and that, in these circumstances, the shipowners had failed to discharge the burden of proof which was on them.’

Lord Brandon of Oakbrook
[1985] 2 All ER 712, [1985] 1 WLR 948, [1985] 2 Lloyds Rep 1, [1985] UKHL 15
Bailii
England and Wales
Citing:
At First Instance – The Popi M; Rhesa Shipping Co SA v Edmonds 1983
The parties disputed the cause of the loss of a ship. The experts suggested different but improbably explanations; each supported as the most likely explanation only because any other hypothesis was regarded as almost (if not altogether) impossible. . .
Approved – La Compania Martiartu v Royal Exchange Assurance Corporation CA 1923
The court found, on limited evidence, that the ship in respect of which her owners had claimed for a total loss of perils by sea, had in fact been scuttled with the connivance of those owners.
Scrutton LJ said: ‘This view renders it . .

Cited by:
Cited – Gibbs and others v Rea PC 29-Jan-1998
(Cayman Islands) The respondent worked for a bank. He disclosed a business interest, but that interest grew in importance to the point where he resigned in circumstances amounting to constructive dismissal. His home and business officers were raided . .
Cited – Moiz Ahmed Siddiqui, Ishrat Siddiqui/Bhajan Singh Sohanpal v Council of the London Borough of Hillingdon TCC 15-Apr-2003
The claimants sought damages for cracks in their house caused by the roots of trees on the defendant’s land.
Held: The claimants had failed to establish by evidence that the tree roots were the cause of the damage. The claim failed. . .
Cited – UCB Group Ltd v Hedworth CA 4-Dec-2003
The defendant challenged the claimant’s right to possession under a legal charge. She appealed a finding that she had not established the undue influence of her husband, a solicitor.
Held: A lender who received a voidable security was entitled . .
Cited – Exel Logistics Ltd v Curran and others CA 30-Sep-2004
The claimants sought damages for personal injuries after a crash in a Land Rover maintained by the defendants. The defendants appealed findings of negligence in failing properly to inflate the rear tyres, in continuing despite the danger, and poor . .
Cited – Stephens and Another v Cannon and Another CA 14-Mar-2005
The claimants had purchased land from the defendants. The contract was conditional on a development which did not take place. The master had been presented with very different valuations of the property.
Held: The master was not entitled to . .
Cited – Flannery and Another v Halifax Estate Agencies Ltd, Trading As Colleys Professional Services CA 18-Feb-1999
A judge at first instance taking a view on an expert’s report should give reasons in his judgment for that view. On appeal, where no reasons had been given, he should be asked to provide reasons by affidavit for the appeal. An inadequately reasoned . .
Cited – McTear v Imperial Tobacco Ltd OHCS 31-May-2005
The pursuer sought damages after her husband’s death from lung cancer. She said that the defenders were negligent in having continued to sell him cigarettes knowing that they would cause this.
Held: The action failed. The plaintiff had not . .
Cited – Carisbrooke Shipping Cv5 v Bird Port Ltd ComC 13-Sep-2005
. .
Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Kastor Navigation Co Ltd and Another v AGF M A T and others (‘Kastor Too’) ComC 4-Dec-2002
The claimant ship owner and its mortgagee sued the defendant insurer after the loss of the insured vessel, through fire. The insurers replied that the damage by fire was so extensive that the vessel was beyond repair when she sank, and was therefore . .
Cited – Hill Street Services Company Ltd v National Westminster Bank Plc and Burjor Mistry ChD 19-Oct-2007
The claimant company said that the bank had allowed money to be removed from its account without authority. Originally it said the second defendant, its former director had authrised the payments. On the second defendant denying this, the company . .
Explained – Ide v ATB Sales Ltd and Another CA 28-Apr-2008
Each appellant challenged how the judge had decided between alternative proofs of causation of the respective loss. In Ide, the claimant asserted a fault in a cycle handlebar, and in Lexus, the claimant asserted that it caught fire whilst . .
Cited – Fosse Motor Engineers Ltd and others v Conde Nast and National Magazine Distributors Ltd and Another TCC 20-Aug-2008
The claimant said that the defendant’s employees had negligently started a fire which burned down the claimant’s warehouse. There was limited evidence to establish the cause.
Held: The claim failed. The scientific evidence did not point to any . .
Cited – Piper v Hales QBD 18-Jan-2013
The claimant owned a very vauable vintage Porsche racing car. It was hired to the defendant. The car suffered severe mechanical damage whilst being driven, and the insurers declined liability.
Held: The Defendant as hirer was under an . .
Cited – Nulty and Others v Milton Keynes Borough Council CA 24-Jan-2013
There had been two fires at a depot owned by the claimants. The fires were found to have been likely to have been caused by the deceased employee. His insurers had repudiated liability saying that the had not been notified oin a timely fashion.
Cited – Milton Keynes Borough Council v Nulty and Others TCC 3-Nov-2011
There had been two fires at depots owned by the claimants. They brought proceedings against an employee, but his insurers repudiated liability saying that they had not been promptly notfied of the claim.
Held: The first fire was caused either . .
Cited – Love v Halfords Ltd QBD 8-Apr-2014
The claimant had purchased a new bicycle from the defendants who also maintained it. Several months later, the steerer tube broke causing an accident and severe injury. The cycle had been finally assembled by the defendant after importation, but . .
Cited – The Worshipful Company of Grocers v Keltbray Group Holdings Ltd and Another QBD 19-May-2016
Allegation that a collapse in a nearby building caused a water leak in the claimant’s nearby building.
Held: the effects of the collapse did not cause the major cracking at Grocers’ Hall which was reported on following the flood. The Grocers . .

Lists of cited by and citing cases may be incomplete.

Evidence, Damages, Insurance, Evidence

Leading Case

Updated: 02 November 2021; Ref: scu.184697

AJ Building and Plastering Ltd v Turner and Others: QBD 11 Mar 2013

An insurance company had engaged a main contractor to handle repairs to houses insured under its policies. The contractor had engaged the claimant subcontractor to carry out the works at the defendants’ homes, but then went into insolvent liquidation before the works were paid for. The claimant now sought payment direct from the insured. The defendants denied any contract with the claimant, despite mandates signed by them.
Held: The claims failed. It was both a perfectly possible reading of the mandate and far more consonant with the commercial common sense of the situation to interpret it to mean that, although the insurer will be responsible for paying the cost of the insured losses, the householder will remain liable for all other costs, namely the policy excess and any works not covered by the insurance.
The court considered the possible application of the contra preferentem rule: ‘The fact that the contra proferentem rule is a matter of common law whereas regulation 7 (2) is a creature of statute is no reason to differentiate between their applications; the 1999 Regulations give wholesale effect to a European Directive and it is unnecessary to suppose that they were intended to affect the common law relating to contractual interpretation. The occasions on which the principle of construction and the common-law rule apply are the same: their operation is limited to cases of genuine interpretative doubt or ambiguity’
The contracts were to be determined on the standard rules for construction. If the terms were unambiguous then the 1999 Regulation had no application, and ‘ it is impermissible to prejudge the construction of the mandates by presupposing an analysis that ignores them. The mandates were in fact signed. A common reason for having written express contracts is to impose and assume liabilities that would not otherwise be implied.’

Keyser QC J
[2013] EWHC 484 (QB)
Bailii
Unfair Terms in Consumer Contracts Regulations 1999 7
England and Wales
Citing:
Cited – Investors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
Cited – Chartbrook Ltd v Persimmon Homes Ltd and Others HL 1-Jul-2009
Mutual Knowledge admissible to construe contract
The parties had entered into a development contract in respect of a site in Wandsworth, under which balancing compensation was to be paid. They disagreed as to its calculation. Persimmon sought rectification to reflect the negotiations.
Held: . .
Cited – St Edmundsbury and Ipswich Diocesan Board of Finance v Clark (No.2) CA 1973
When looking at a contract ‘one must construe the document according to the natural meaning of the words contained in the document as a whole, read in the light of surrounding circumstances.’
The contra preferetem rule can only come into play . .
Cited – Mira Oil Resources of Tortola v Bocimar NV ChD 1999
Colman J discussed the application of the contra preferentem rule: ‘Further, this is not a case where the meaning of the words is so finely balanced that the contra proferentum rule should be applied in favour of the owners. If in the view of the . .
Cited – Association of British Travel Agents Ltd v British Airways Plc CA 2000
Sedley LJ described the common-law rule of contra preferentem, that any doubt as to the meaning of contractual words will be resolved by construing them against the party that put them forward, as ‘a principle not only of law but of justice’ and . .
Approved – The Financial Services Authority v Asset L I Inc and Others ChD 8-Feb-2013
The court was asked whether so-called ‘land-banking’ schemes were ‘collective investments schemes’ within section 235.
Held: Andrew Smith J discussed the difference in effect between the contra preferentem rule, and regulation 7 of the 1999 . .
Cited – Rainy Sky Sa and Others v Kookmin Bank SC 2-Nov-2011
Commercial Sense Used to Interpret Contract
The Court was asked as to the role of commercial good sense in the construction of a term in a contract which was open to alternative interpretations.
Held: The appeal succeeded. In such a case the court should adopt the more, rather than the . .
Cited – Pink Floyd Music Ltd and Another v EMI Records Ltd CA 14-Dec-2010
The defendant appealed against an order made on the claimant’s assertion that there were due to it substantial underpayments of royalties over many years. The issues were as to the construction of licensing agreements particularly in the context of . .
Cited – Direct Travel Insurance v McGeown CA 12-Nov-2003
The contra proferentem interpretation rule is to be invoked only in cases of genuine doubt or ambiguity. Auld LJ said: ‘A court should be wary of starting its analysis by finding an ambiguity by reference to the words in question looked at on their . .
Cited – Du Plessis v Fontgary Leisure Parks Ltd CA 2-Apr-2012
The claimant, who owned a holiday mobile home on the respondent’s site challenged the raising of site fees, saying that the contract was unfair. Previously all site fees were equal within the site, but the respondent had introduced a scheme which . .
Cited – Brown and Davis Ltd v Galbraith CA 1972
The defendant’s car was damaged in a collision. It was taken to the plaintiff’s garage for repair. The defendant’s insurers contracted with the defendant to pay for the repairs for a specified amount. The plaintiff carried out repair work, and the . .
Cited – Curtis v Chemical Cleaning and Dyeing Co CA 1951
The defendant sought to rely on an exemption clause in its garment cleaning contract. The defendant’ shop assistant had said that it extended only to damage to beads and sequins, whereas by its terms it covered all liability for damage to articles . .
Cited – Amalgamated Investment and Property Co Ltd (in Liq) v Texas Commerce International Bank Ltd CA 1982
The court explained the nature of an estoppel by convention.
Lord Denning MR said: ‘The doctrine of estoppel is one of the most flexible and useful in the armoury of the law. But it has become overloaded with cases. That is why I have not gone . .
Cited – Peekay Intermark Ltd v Australia and New Zealand Banking Group Ltd CA 6-Apr-2006
Moore-Bick LJ discussed whether the court should give effect to a non-reliance clause in a contract saying: ‘It is common to include in certain kinds of contracts an express acknowledgement by each of the parties that they have not been induced to . .

Lists of cited by and citing cases may be incomplete.

Contract, Insurance, Consumer

Leading Case

Updated: 02 November 2021; Ref: scu.471743

Litaksa UAB v BTA Insurance Company SE: ECJ 26 Mar 2015

Judgment – Reference for a preliminary ruling – Compulsory insurance against civil liability in respect of the use of motor vehicles – Directive 90/232/EEC – Article 2 – Differentiation in the amount of the insurance premium depending on the territory in which the vehicle is used

L. Bay Larsen, P
C-556/13, [2015] EUECJ C-556/13, ECLI:EU:C:2015:202
Bailii
Directive 90/232/EEC 2
European

Road Traffic, Insurance

Updated: 02 November 2021; Ref: scu.545366

Lim (An Infant) v Walia: CA 29 Jul 2014

The parties disputed a claim under the 1975 Act. Immediately before her death, the deceased had, because of her medical condition, a vested right to bring forward an insurance benefit, but that right had ceased upon her death. The court had found that the sum available was part of the estate for the purposes of the 1975 Act. The policy was a joint-life furst death policy. Thr 1975 Act referred to the value of the estate immediately before the death.
Held: The appeal succeeded (McCombe LJ dissenting). Section 9 asked two questions: did she have a severable interest in the terminal illness benefit, and what was that value immediately before her death. The policy made no provision for the advanced benefit to be paid to one only of the insured lives. The deceased had a severable interest which remained contingent until a claim was made. Under section 9(1) the valuation of a severable interest should take into account the imminence of death. The valuation should take into account events occurring after the date at which valuation was to occur. Because no claim had been made the value immediately before the death was nil.

Ardn, McFarlane, McCombe LJJ
[2014] EWCA Civ 1076, [2014] WLR(D) 339
Bailii, WLRD
Inheritance (Provision for Family and Dependants) Act 1975
England and Wales
Citing:
Appeal from – Lim and Others v Walia ChD 26-Sep-2012
The court was asked: ‘where the proceeds of a fixed term joint life policy are paid over as the result of the death of the first of the joint lives insured, but in circumstances where it is to be assumed that the payment of the sum insured might . .
Cited – Powell v Osbourne CA 1993
The deceased had separated from his wife and was cohabiting with Miss Osbourne. The deceased and Miss Osbourne purchased a property as joint tenants, with the assistance of a mortgage. The purchase price had been andpound;91,000 and the mortgage was . .
Cited – Murphy (By Her Litigation Friend Stockmont) v Holland CA 19-Dec-2003
A married couple had taken out an insurance policy on their joint lives. The policy was maintained after they divorced. On his death, his child by the later marriage claimed a share in the policy under the 1975 Act.
Held: (Chadwick LJ . .
Cited – Dingmar v Dingmar CA 12-Jul-2006
A house was held upon joint tenancy between the deceased and one of his sons. The transfer into joint names took effect just before the deceased married the claimant. They lived at the property with her children. Seven years after the death, the son . .

Lists of cited by and citing cases may be incomplete.

Wills and Probate, Family, Insurance

Updated: 02 November 2021; Ref: scu.535401

Thomson v Weems: HL 1884

Where a basis of the contract clause makes the correctness or completeness of the insured’s disclosure into a warranty, a breach of that warranty has the effect that the insurance cover never attaches under the contract.
Lord Blackburn said: ‘In policies of marine insurance I think it is settled by authority that any statement of a fact bearing upon the risk introduced into the written policy is, by whatever words and in whatever place, to be construed as a warranty, and prima facie, at least that the compliance with that warranty is a condition precedent to the attachment of the risk.’

Lord Blackburn
[1884] 9 AC 671
England and Wales
Cited by:
Cited – F L Schuler AG v Wickman Machine Tools Sales Limited HL 4-Apr-1973
The parties entered an agreement to distribute and sell goods in the UK. They disagreed as to the meaning of a term governing the termination of the distributorship.
Held: The court can not take into account the post-contractual conduct or . .
Cited – Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (The Good Luck) HL 1992
The effect of breach of an insurance warranty is automatic, rather than dependant on any acceptance or election.
Lord Goff of Chieveley said: ‘So it is laid down in section 33(3) that, subject to any express provision in the policy, the insurer . .
Cited – Brit Syndicates Ltd and others v Italaudit Spa and others HL 12-Mar-2008
The parties disputed the extent of cover under an insurance policy. The insured firm of accountants had failed to verify the existence of a substantial balance claimed by the company it audited. The policy ‘included as an Assured Firm but solely in . .

Lists of cited by and citing cases may be incomplete.

Insurance

Leading Case

Updated: 02 November 2021; Ref: scu.251140

Philip Owen Lloyd-Wolper v Robert Moore; National Insurance Guarantee Corporation Plc, Charles Moore: CA 22 Jun 2004

The first defendant drove a car belonging to his father and insured by his father. The father consented to the driving but under a mistaken belief that his son was licensed. The claimant was injured by the defendant in a road traffic accident.
Held: For insurance purposes, the father could validly permit the driving when under a mistake. A permission which would arise only subject to and upon the fulfillment of a condition was not a permission until that condition was fulfilled, but a permission given did not cease to be one only such for mistake. There was no relevance in different kinds of mistake.
Pill LJ said: ‘permission does not cease to be permission for the purposes of the statute because, in good faith, the person giving it believes that the person to whom it is given is covered by the policy when in fact the person is not.’

Lord Justice Pill, Lord Justice Rix
[2004] EWCA Civ 766, Times 06-Aug-2004, [2004] 3 All ER 741, [2004] 1 WLR 2350
Bailii
Road Traffic Act 1988 151
England and Wales
Citing:
Cited – Newbury v Davis QBD 1974
newbury_davisQBD1974
The owner of a vehicle agreed to lend it to someone else on condition that that person insured against third party risks. In the owner’s absence, that person drove the car on a road without insurance.
Held: The appeal against conviction was . .
Cited – Ferrymasters Ltd v Adams 1980
Employers were alleged to have caused or permitted an employee to drive a vehicle on the road while not holding a driving licence authorising him to do so. When the employee had entered the employment, the employers had ensured that he held a valid . .
Cited – Baugh v Crago QBD 1975
The defendant believed that a driver was the holder of a driving licence and permitted him to use the vehicle, when the driver was not in fact such a holder. The prosecutor appealed his acquittal.
Held: Considering Newbury v Davis. The . .
Cited – Director of Public Prosecutions v Fisher QBD 1992
F was asked to lend L a car. F knew L was disqualified, but agreed provided L found an insured driver with a full valid driving licence. F did not know who L would ask or that he in fact asked R to drive; R was employed as delivery driver and the . .
Cited – Monk v Warbey CA 1935
The court took a strict view of a vehicle owner’s potential liability to injured third parties.
Held: A person who suffered injury by reason of a breach of s35 could maintain an action in damages for that breach: ‘The Road Traffic Act, 1930, . .
Cited – Lyons v May 1948
A person who was ignorant of the fact that there was no policy of insurance covering a vehicle may be guilty of an offence if he permits the use of the vehicles while uninsured. . .

Cited by:
Cited – Churchill Insurance Company Ltd v Wilkinson and Others CA 19-May-2010
The various insured defendants had been driven in the insured vehicles by a non-insured driver. Suffering injury at the negligence of the driver, they recovered variously damages. Their insurance companies sought recovery of the sums paid from their . .

Lists of cited by and citing cases may be incomplete.

Insurance, Road Traffic, Personal Injury

Leading Case

Updated: 01 November 2021; Ref: scu.198301

Cavell USA, Inc and Randall v Seaton Insurance Company etc: CA 16 Dec 2009

The parties had settled terms for concluding business arrangements between them. The agreement released and referred all claims in law and in equity ‘save for fraud’ to the UK courts. The respondents now wanted to bring a case alleging breach of a contractual or fiduciary duty, and to bring the case in the US, saying that as the claims amounted to fraud, and were there excluded from the jurisdiction provision. The claimants sought an order to prevent them.
Held: The concept of dishonesty was not an essential element of a fraud. Looking at the contract, any claim for fraud was to be brught in England. The judge had incorrectly conflated ‘claims in fraud’ and ‘in the case of fraud’. This narrowed down the the phraseology of the release. The word ‘fraud’ did not require as an essential element an allegation of dishonesty. The document was an international commercial one, and it would be wrong to import too narrow a meaning: ‘in the commercial context of this case the concept of ‘fraud’ is wider than the concept of the tort of deceit where a fraudulent misrepresentation (or equivalent) is required.’

Mummery, Longmore, Toulson LJ
[2009] EWCA Civ 1363, Times 12-Jan-2010, [2010] Lloyd’s Rep FC 197, [2009] 2 CLC 991
Bailii
England and Wales
Citing:
Appeal from – Cavell USA Inc and Another v Seaton Insurance Company and Another ComC 11-Dec-2008
The court gave preliminary rulings as to the meanings on a term sheet signed by both parties which set out arrangements for the termination of other agreements between them. The sheet had released the second defendant from all claims ‘whether in law . .
Cited – Reddaway and Co Ltd v Banham and Co Ltd HL 1896
The plaintiff manufactured and sold Camel Hair Belting. The defendant also began to sell belting made of camel’s hair in the name of Camel Hair Belting. The trader claimed a right in the term ‘Camel Hair’.
Held: The term was descriptive. Where . .
Cited – Satyam Computer Services Ltd v Upaid Systems Ltd CA 9-May-2008
The parties had settled their action, but the claimant now wished to assert that the compromise was based on a concealed fraud. The defendant argued that the agreement precluded re-opening the case.
Held: It was only by the clearest of words . .
Cited – Welham v Director of Public Prosecutions HL 1961
The House considered what was required to establish an ‘intent to defraud’.
Held: Lord Radcliffe said: ‘Now, I think that there are one or two things that can be said with confidence about the meaning of this word ‘ defraud ‘. It requires a . .
Cited – Barclays Bank v Cole CA 1966
There was a bank robbery and the robber had paid in part of the stolen proceeds into another branch of the same bank and the bank sued the robber to recover the stolen monies after the robber had been convicted of robbery and the robber had claimed . .
Cited – Armitage v Nurse; etc CA 19-Mar-1997
A clause in a trust deed may validly excuse trustees from personal liability for even gross negligence. The trustee was exempted from liability for loss or damage ‘unless such loss or damage shall be caused by his own actual fraud’.
Held: The . .
Cited – Kensington International Ltd v Republic of Congo CA 7-Nov-2007
The defendants appealed against orders requiring them to disclose documents in an action regarding the payment of bribes, saying that the requirement effectively required them to incriminate themselves.
Held: The appeal failed. The public . .

Lists of cited by and citing cases may be incomplete.

Insurance, Torts – Other

Updated: 01 November 2021; Ref: scu.384147

HIH Casualty and General Insurance Limited v New Hampshire Insurance Company Independent Insurance Company Limited Axa Reinsurance S A: CA 21 May 2001

A claim was made under a re-insurance policy which supported film finances. The re-insurers resisted the claim on the grounds of misrepresentation. Rix LJ: ‘In principle it would seem to me that it is always admissible to look at prior contracts as part of the matrix or surrounding circumstances of a later contract. I do not see how the parol evidence rule can exclude prior contracts, as distinct from mere negotiations. The difficulty of course is that, where the later contract is intended to supersede the prior contract, it may in the generality of cases simply be useless to try to construe the later contract by reference to the earlier one. . Where, however, it is not even common ground that the later contract is intended to supersede the earlier contract, I do not see how it can ever be permissible to exclude reference to the earlier contract.’

Lord Justice Aldous Lord Justice Rix and Mr Justice Lloyd
[2001] EWCA Civ 735, [2001] 2 Lloyds Rep 161, [2001] LLR IR 224
Bailii
England and Wales
Citing:
See also – HIH Casualty And General Insurance Limited and Others v The Chase Manhattan Bank and Others CA 31-Jul-2001
Parties syndicating finance for a film obtained the security of an insurance which is designed to pay up to the sum insured, if the revenues generated by the film were insufficient to repay the loan finance plus associated expenses. The polices were . .

Cited by:
Cited – Amiri Flight Authority v BAE Systems Plc CA 17-Oct-2003
The appellant had contracted to purchase maintenance from the defendant of aircraft it had also purchased from them. They sought damages for negligence, saying the defendants had failed to prevent a known risk of corrosion. The defendants argued . .
See also – HIH Casualty And General Insurance Limited and Others v The Chase Manhattan Bank and Others CA 31-Jul-2001
Parties syndicating finance for a film obtained the security of an insurance which is designed to pay up to the sum insured, if the revenues generated by the film were insufficient to repay the loan finance plus associated expenses. The polices were . .
Cited – Taylor v Rive Droite Music Ltd ChD 6-Jul-2004
The claimant music producer and songwriter had entered into a publishers agreement with the defendant, agreeing to work for it. He now sought to be free to work for another company. The factual background was unclear, and the contract documentation . .
Cited – Limit (No 3) Ltd and others v PDV Insurance Company CA 11-Apr-2005
There had been substantial oil leaks in Venezuela, which had been insured and then re-insured in London. Permission had been given to serve the defendant out of the jurisdiction, but that permission had been set aside. The claimant now appealed.
Cited – KPMG Llp v Network Rail Infrastructure Ltd ChD 31-Jan-2006
. .
Cited – Crown Estate Commissioners v Roberts and Another ChD 13-Jun-2008
The defendant claimed ownership as Lord Marcher of St Davids of historical rights in foreshores in Pembrokeshire. The claimants sought removal of his cautions against first registration.
Held: Lewison J explored the history of manorial . .

Lists of cited by and citing cases may be incomplete.

Insurance, Contract

Leading Case

Updated: 01 November 2021; Ref: scu.147555