Sharon's Bakery (Europe) Ltd v Axa Insurance UK Plc & Anor

Sharon's Bakery (Europe) Ltd v Axa Insurance UK Plc & Anor

The claimant, through its directors, knowingly submitted a false invoice to Lombard to evidence a fictitious sale and payment, constituting dishonesty and a material non-disclosure of moral hazard to the insurers. The same false document was used in support of the insurance claim, amounting to fraudulent means or devices. These actions justified the defendants' avoidance of the policy and forfeiture of all benefit under it.

Parties
Claimant: Sharon's Bakery (Europe) Ltd; Defendant: AXA Insurance UK PLC; Defendant: Aviva Insurance Ltd
Jurisdiction
England and Wales
Judgment Date
09 February 2011
Procedural Posture
Commercial Insurance Claim / Judgment After Trial
Outcome
Claim dismissed
Legal Topics
Material Non Disclosure, Moral Hazard, Fraudulent Means or Devices, Inducement, Quantum of Indemnity
Insurance Law Commercial Law Material Non Disclosure Moral Hazard Fraudulent Means or Devices Inducement Quantum of Indemnity

Case Brief

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Parties

Sharon's Bakery (Europe) Ltd

Claimant

AXA Insurance UK PLC

Defendant

Aviva Insurance Ltd

Defendant

Procedural Posture

Commercial Insurance Claim / Judgment After Trial

Legal Issues

  1. 1 Whether the claimant failed to disclose material facts amounting to moral hazard
  2. 2 Whether the claimant used fraudulent means or devices in support of its insurance claim
  3. 3 Whether the insurance policy was validly avoided by the defendants

Ratio Decidendi

The claimant, through its directors, knowingly submitted a false invoice to Lombard to evidence a fictitious sale and payment, constituting dishonesty and a material non-disclosure of moral hazard to the insurers. The same false document was used in support of the insurance claim, amounting to fraudulent means or devices. These actions justified the defendants' avoidance of the policy and forfeiture of all benefit under it.

Court Disposition

Claim dismissed

Orders

  • The claim is dismissed in its entirety.