Category Archives: Contractual interpretation

On Shaky Ground: the Robin Rigg case

MT Højgaard A/S v E.On Climate & Renewables UK Robin Rigg East Ltd & Anor [2017] UKSC 59

The proceedings in this case arose from the fact that the foundation structures of two offshore wind farms, which were designed and installed by MT Højgaard A/S (“MTH”), failed shortly after completion of the project. The issue for the court to determine was whether MTH was liable for this failure.

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Filed under Breach of contract, Contractual interpretation

Judgment alert: UKSC decision on design and installation of windfarm foundations

MT Højgaard A/S (Respondent) v E.ON Climate and Renewables UK Robin Rigg East Ltd and another (Appellants)

The issue in this case is whether a contract for the design and installation of foundations for an offshore windfarm in the Solway Firth imposed a fitness for purpose obligation on the contractor amounting to a warranty that said foundations would have a service life of 20 years.

The UK Supreme Court unanimously allowed the appeal, holding that the windfarm foundations neither had a lifetime of twenty years, nor was their design fit to ensure one.

Access the UKSC judgment  here

For a non-PDF version of the judgment, please visit: BAILII

For Court’s press summary, click here

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Filed under Breach of contract, Contractual interpretation

Like Shattered Glass: 125 OBS (Nominees) & Another v Lend Lease Construction (Europe) Ltd and Another [2017]

A contractor was ordered to pay £14.7 million in damages following a failure of toughened glass used to clad a central London office block. The breakages were caused by the contractor’s breach of its contractual obligations to heat soak all of the glass.
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Filed under Breach of contract, Contractual interpretation

Goodlife Foods Ltd v Hall Fire Protection Ltd [2017] EWHC 767 (TCC)

This is a useful decision of the Court upholding the application of a broadly drafted clause excluding property damage liability in negligence on the part of a supplier of a fire prevention mechanism which failed.  Continue reading

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Filed under Breach of contract, Contractual interpretation, Exclusion clauses, Fires

UKSC decision on insurance policy exclusion clauses

IMPACT FUNDING SOLUTIONS LTD v AIG EUROPE LTD (FORMERLY CHARTIS INSURANCE (UK) LTD) (2016)

Last week the UKSC handed down judgment in a case that involved the construction of exclusion or exemption clauses in insurance policies.

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Filed under Breach of contract, Contractual interpretation, Insurance

Fraudulent means and devices revisited by the Supreme Court

As reported last week the Supreme Court has allowed the appeal of the claimant shipowners in Versloot Dredging BV and another (Appellants) v HDI Gerling Industrie Versicherung AG and others (The “DC Merwestone”)  [2016] UKSC45. By a 4:1 majority the Supreme Court held that the fraudulent claims rule did not apply to collateral lies made in support of an insurance claim where those lies were irrelevant to the existence or amount of a justified claim.

The shipowners were entitled to payment of over 3 million euros in respect of damage caused to their ship’s engine by the ingress of sea water. Their manager’s lies regarding the timing of the bilge alarms, which he told in support of the claim, were irrelevant to the owners’ entitlement to payment under the policy. The false statements were intended to reassure insurers that the ship was not unseaworthy and, in particular, that its alarm systems were working satisfactorily and to draw insurers’ focus away from such matters. Continue reading

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Filed under Breach of contract, Contractual interpretation, Floods

UKSC hands down decision on fraudulent devices rule – Versloot Dredging

The UK Supreme Court handed down judgment in Versloot Dredging BV and Another v HDI Gerling Industrie Versicherung AG and others . You can access the full text of the decision here.

In brief, the Court determined (by a majority of 4 to 1) that the ‘fraudulent device’ rule does not apply to collateral lies, which are immaterial to the insured’s right to recover. Lord Sumption gave the lead judgment. Lord Clarke, Lord Hughes and Lord Toulson give concurring judgments. Lord Mance gives a dissenting judgment.

Our previous blog post on Versloot can be found here.

An in-depth analysis of Lord Sumption and Lord Mance’s judgments will be posted shortly. Watch this space.

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Filed under Breach of contract, Contractual interpretation, Floods

Fraudulent devices case to be heard by the UK Supreme Court

Versloot Dredging BV and Another v HDI Gerling Industrie Versicherung AG and others

The UK Supreme Court will hear the appeal in Versloot on 16 March 2016. In the previous judgment, the Court of Appeal, Civil Division, considered whether the rule whereby a fraudulent claim deprived the insured of any right to recover anything applied also in the case of ‘fraudulent devices’, namely statements made recklessly or with knowledge of their untruth to support a claim that was honestly believed to be true. In dismissing the claimant owners’ appeal, the court held that the rule was to be applied in such circumstances and that it was proportionate for it to do so.  Continue reading

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Filed under Breach of contract, Contractual interpretation, Floods

Maccaferri Ltd v Zurich Insurance PLC: When is notification “as soon as possible”?

There are often disputes between insureds and insurers as to whether notification of a claim has been done in time. The following is a recent example involving an obligation to notify “as soon as possible”: Maccaferri Ltd v Zurich Insurance PLC [2015] EWHC1708

An employee was seriously injured at work whilst using a Spanex gun, which had been hired from the claimant. The claimant was insured under a public and products liability policy issued by Zurich Insurance PLC (“Zurich”).  Continue reading

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Filed under Contractual interpretation, Insurance

From 1 October 2015: The Consumer Rights Act 2015

It is of importance to anyone who deals with consumer contracts to know that many of the provisions of the Consumer Rights Act 2015 (the “Act”) are due to come into force tomorrow, 1st October 2015.

In the property damage context, it is common for such consumer contracts to play a key role where allegations that, for instance, a faulty electrical item has caused a fire, or a badly-plumbed pipe has caused an escape of water, are regularly encountered. Continue reading

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Filed under Contractual interpretation, Insurance