Woodford v AIG Europe Ltd & Anor

Woodford v AIG Europe Ltd & Anor

There was no knowledge of alleged breaches of duty prior to 1 August 2015 attributable to the Policyholder or insured persons; AIG was not entitled to decline cover under SC5 or clause 5.5; the defence costs claimed are reasonable and recoverable under the Policy.

Parties
Claimant: Michael Woodford MBE; Claimant: Paul Hillman; Defendant: AIG Europe Limited; Defendant: KeyMed (Medical and Industrial Equipment) Limited
Jurisdiction
England and Wales
Judgment Date
02 March 2018
Procedural Posture
Commercial Insurance Dispute / Final Judgment After Trial
Outcome
Claim allowed
Legal Topics
Directors and Officers Insurance, Breach of Directors' Duties, Knowledge Attribution Under German Law, Obligation to Provide Information, Quantum of Defence Costs
Insurance Law Company Law Contract Law Directors and Officers Insurance Breach of Directors' Duties Knowledge Attribution Under German Law Obligation to Provide Information Quantum of Defence Costs

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Parties

Michael Woodford MBE

Claimant

Paul Hillman

Claimant

AIG Europe Limited

Defendant

KeyMed (Medical and Industrial Equipment) Limited

Defendant

Procedural Posture

Commercial Insurance Dispute / Final Judgment After Trial

Legal Issues

  1. 1 Whether the Policyholder or persons whose knowledge is attributable to the Policyholder had knowledge of alleged breaches of duty prior to 1 August 2015
  2. 2 Whether AIG is entitled to decline cover by reference to clause 5.5 of the Policy
  3. 3 Quantum of defence costs recoverable under the Policy

Ratio Decidendi

There was no knowledge of alleged breaches of duty prior to 1 August 2015 attributable to the Policyholder or insured persons; AIG was not entitled to decline cover under SC5 or clause 5.5; the defence costs claimed are reasonable and recoverable under the Policy.

Court Disposition

Claim allowed

Orders

  • AIG to indemnify claimants for defence costs incurred to 31 December 2017: £2,318,053 for Mr Woodford and £1,773,223 for Mr Hillman
  • Interest at German statutory rate of 4.12% per annum payable 14 days after expiry of demand