Axa S.A. v Genworth Financial International Holdings, Llc & Ors [2020] EWHC 2024 (Comm) (27 July 2020)

Axa S.A. v Genworth Financial International Holdings, Llc & Ors [2020] EWHC 2024 (Comm) (27 July 2020)

The word 'incurred' in SPA Clause 10.8 means a legal obligation to pay, not actual payment; AXA need only prove liability, not payment, for losses to be recoverable. Losses relating to policies underwritten by FICL/FACL are within scope. Gross-up clause operates by reference to potential tax liability, not actual tax paid. Quantum proven by evidence of obligations and payments, including uncashed cheques and administrative costs.

Citation
[2020] EWHC 2024 (Comm)
Parties
Claimant: AXA S.A.; First Defendant: Genworth Financial International Holdings, LLC; Second Defendant: Genworth Financial, Inc.; Third Party: AXA France IARD; Third Party: AXA France VIE; Third Party: Santander Cards UK Limited; Third Party: Santander Insurance Services UK Limited
Jurisdiction
England and Wales
Judgment Date
27 July 2020
Procedural Posture
Commercial Court Quantum Hearing / Post Liability Judgment, Quantum Determination
Outcome
Claim allowed in respect of quantum as proven; AXA entitled to recover losses and gross-up as determined.
Legal Topics
Indemnity Clauses, Payment Protection Insurance Mis Selling, Contractual Construction, Tax Gross Up Provisions, Proof of Quantum
Contract Law Insurance Law Commercial Law Indemnity Clauses Payment Protection Insurance Mis Selling Contractual Construction Tax Gross Up Provisions Proof of Quantum

Case Brief

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Parties

AXA S.A.

Claimant

Genworth Financial International Holdings, LLC

First Defendant

Genworth Financial, Inc.

Second Defendant

AXA France IARD

Third Party

AXA France VIE

Third Party

Santander Cards UK Limited

Third Party

Santander Insurance Services UK Limited

Third Party

Procedural Posture

Commercial Court Quantum Hearing / Post Liability Judgment, Quantum Determination

Legal Issues

  1. 1 Whether losses claimed by AXA were 'incurred' under SPA Clause 10.8
  2. 2 Whether losses relate to policies underwritten by FICL/FACL
  3. 3 Proper construction of tax gross-up clause (Clause 18.5)

Ratio Decidendi

The word 'incurred' in SPA Clause 10.8 means a legal obligation to pay, not actual payment; AXA need only prove liability, not payment, for losses to be recoverable. Losses relating to policies underwritten by FICL/FACL are within scope. Gross-up clause operates by reference to potential tax liability, not actual tax paid. Quantum proven by evidence of obligations and payments, including uncashed cheques and administrative costs.

Court Disposition

Claim allowed in respect of quantum as proven; AXA entitled to recover losses and gross-up as determined.

Orders

  • Genworth to pay AXA £499,834,187 less interim payment of £100 million, plus applicable gross-up for tax liability.
  • Mechanism to be agreed for future claims to avoid repeated litigation.