BP Plc v AON Ltd & Anor

BP Plc v AON Ltd & Anor

Aon London owed BP a duty of care in tort to make effective declarations to all underwriters under the Open Cover. The contractual Service Agreement with Aon Texas did not exclude or limit Aon London's tort liability. Aon London breached its duty by failing to make timely declarations, causing BP and its co-assureds to suffer unrecoverable losses. BP's settlement with the Frankona Defendants was reasonable, and BP's failure to obtain substitute insurance did not break causation or constitute failure to mitigate. Damages are measured by the amounts that would have been recovered from the Frankona Defendants if valid declarations had been made.

Parties
Claimant: BP Plc; Defendant: AON Limited; Defendant: Aon Risk Services of Texas Inc
Jurisdiction
England and Wales
Judgment Date
13 March 2006
Procedural Posture
Commercial Court Judgment / Final Judgment After Trial
Outcome
Judgment for BP and co-assureds against Aon London for negligence in tort.
Legal Topics
Broker's Duty of Care, Assumption of Responsibility, Measure of Damages, Sub Broker Liability, Contractual Indemnity, Estoppel, Mitigation of Loss
Insurance Law Tort Law Professional Negligence Broker's Duty of Care Assumption of Responsibility Measure of Damages Sub Broker Liability Contractual Indemnity +2 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 6 Authorities cited 11 Party arguments 2 Amounts and remedies 11
Sign in to unlock

Parties

BP Plc

Claimant

AON Limited

Defendant

Aon Risk Services of Texas Inc

Defendant

Procedural Posture

Commercial Court Judgment / Final Judgment After Trial

Legal Issues

  1. 1 Did Aon London owe BP a duty of care in tort regarding declarations under the Open Cover?
  2. 2 Was Aon London negligent in failing to make timely declarations to all underwriters?
  3. 3 Does the Service Agreement limit or exclude Aon London's tort liability?

Ratio Decidendi

Aon London owed BP a duty of care in tort to make effective declarations to all underwriters under the Open Cover. The contractual Service Agreement with Aon Texas did not exclude or limit Aon London's tort liability. Aon London breached its duty by failing to make timely declarations, causing BP and its co-assureds to suffer unrecoverable losses. BP's settlement with the Frankona Defendants was reasonable, and BP's failure to obtain substitute insurance did not break causation or constitute failure to mitigate. Damages are measured by the amounts that would have been recovered from the Frankona Defendants if valid declarations had been made.

Court Disposition

Judgment for BP and co-assureds against Aon London for negligence in tort.

Orders

  • Aon London liable in tort for losses suffered by BP and co-assureds due to failure to declare to Frankona Defendants.
  • Damages to be measured by amounts that would have been recovered from Frankona Defendants if valid declarations had been made.