Palliser Ltd v Fate Ltd & Ors [2019] EWHC 43 (QB) (16 January 2019)

Palliser Ltd v Fate Ltd & Ors [2019] EWHC 43 (QB) (16 January 2019)

Section 6 of the insurance policy does not cover Fate's liability for fire damage to the upper floors because Fate, as freehold owner, 'owned' the property; thus, the claim fails except for £8,500 relating to fixtures and fittings not belonging to Fate. Even if the Berni Inns defence applies where the landlord is...

Source-derived case information.

Citation
[2019] EWHC 43
Parties
Claimant: Palliser Limited; First Defendant: Fate Limited (in liquidation); Second Defendant: The National Insurance and Guarantee Corporation Limited; Third Defendant: UK Insurance Limited
Jurisdiction
England and Wales
Judgment Date
16 January 2019
Procedural Posture
Insurance/contractual Interpretation/negligence / Trial Judgment
Outcome
Claim dismissed except for £8,500 awarded to claimant for refurbishment costs relating to fixtures and fittings not belonging to Fate.
Legal Topics
Third Parties (rights Against Insurers) Act 2010, Contractual Interpretation, Implied Exclusion of Liability, Landlord's Covenant to Insure, Negligence, Quantum of Damages
Insurance Law Landlord and Tenant Tort Law Contract Law Third Parties (rights Against Insurers) Act 2010 Contractual Interpretation Implied Exclusion of Liability Landlord's Covenant to Insure +2 more

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Parties

Palliser Limited

Claimant

Fate Limited (in liquidation)

First Defendant

The National Insurance and Guarantee Corporation Limited

Second Defendant

UK Insurance Limited

Third Defendant

Procedural Posture

Insurance/contractual Interpretation/negligence / Trial Judgment

Legal Issues

  1. 1 Whether section 6 of the insurance policy covers Fate's liability for fire damage to upper floors let to Palliser ('property not belonging to Fate' issue)
  2. 2 Whether the Berni Inns defence (implied exclusion of liability due to landlord's covenant to insure) applies where the landlord is negligent and underinsured
  3. 3 Whether Palliser has proved its claim for loss of profits to the required standard

Ratio Decidendi

Section 6 of the insurance policy does not cover Fate's liability for fire damage to the upper floors because Fate, as freehold owner, 'owned' the property; thus, the claim fails except for £8,500 relating to fixtures and fittings not belonging to Fate. Even if the Berni Inns defence applies where the landlord is negligent, it is subject to a qualification: it does not exclude liability to the extent the landlord underinsured. Palliser failed to prove its loss of profits claim to the required standard; the claim was speculative and unsupported by credible evidence.

Court Disposition

Claim dismissed except for £8,500 awarded to claimant for refurbishment costs relating to fixtures and fittings not belonging to Fate.

Orders

  • Claim for refurbishment costs allowed in part: £8,500 awarded to Palliser.
  • Claim for remainder of refurbishment costs (£216,500) dismissed.