Wood v Sureterm Direct Ltd & Anor

Wood v Sureterm Direct Ltd & Anor

The indemnity clause (clause 7.11) is to be construed as covering all losses, including fines, compensation, or remedial payments imposed or required by regulatory authorities, arising from mis-selling or suspected mis-selling prior to completion, regardless of whether there has been a customer claim or complaint. The words qualifying the indemnity by reference to claims or complaints registered with the FSA or other authorities apply only to the illustrative losses in the second limb of the clause, not to all losses generally.

Parties
Claimant: Andrew Wood; First Defendant: Sureterm Direct Limited; Second Defendant: Capita Insurance Services Limited
Jurisdiction
England and Wales
Judgment Date
14 October 2014
Procedural Posture
Commercial Court Preliminary Issue Trial / Judgment on Preliminary Issue Regarding Construction of Indemnity Clause
Outcome
Preliminary issue resolved in favour of Capita (Second Defendant)
Legal Topics
Indemnity Clauses, Share Purchase Agreements, Mis Selling of Insurance, Regulatory Compliance
Contract Law Commercial Law Insurance Law Indemnity Clauses Share Purchase Agreements Mis Selling of Insurance Regulatory Compliance

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Parties

Andrew Wood

Claimant

Sureterm Direct Limited

First Defendant

Capita Insurance Services Limited

Second Defendant

Procedural Posture

Commercial Court Preliminary Issue Trial / Judgment on Preliminary Issue Regarding Construction of Indemnity Clause

Legal Issues

  1. 1 Proper construction of clause 7.11 of the SPA regarding indemnity for mis-selling or suspected mis-selling of insurance products
  2. 2 Whether indemnity is triggered only by claims or complaints registered with the FSA or also by regulatory findings absent such claims

Ratio Decidendi

The indemnity clause (clause 7.11) is to be construed as covering all losses, including fines, compensation, or remedial payments imposed or required by regulatory authorities, arising from mis-selling or suspected mis-selling prior to completion, regardless of whether there has been a customer claim or complaint. The words qualifying the indemnity by reference to claims or complaints registered with the FSA or other authorities apply only to the illustrative losses in the second limb of the clause, not to all losses generally.

Court Disposition

Preliminary issue resolved in favour of Capita (Second Defendant)

Orders

  • Declaration that Capita's construction of clause 7.11 is correct and applies to the indemnity claim