Tokio Marine Europe Insurance Ltd v Novae Corporate Underwriting Ltd

Tokio Marine Europe Insurance Ltd v Novae Corporate Underwriting Ltd

The Retrocession covers TMEI's liability under both the Master Policy and local policies; 'Loss Occurrence' is to be construed identically to 'Occurrence' in the Master Policy; Novae is bound to follow settlements made by ACE; the standard of proof is arguability; and Novae is bound by ACE's determination on aggregation provisions, provided the settlement arguably falls within the Retrocession and ACE acted honestly and businesslike.

Parties
Claimant: Tokio Marine Europe Insurance Ltd; Defendant: Novae Corporate Underwriting Ltd
Jurisdiction
England and Wales
Judgment Date
06 November 2013
Procedural Posture
Commercial Insurance/reinsurance Dispute / Judgment on Preliminary Issues
Outcome
Judgment for the Claimant on all five preliminary issues.
Legal Topics
Follow the Settlements Clause, Construction of Insurance Contracts, Aggregation Provisions, Standard of Proof in Reinsurance Claims, Back to Back Coverage
Insurance Law Reinsurance Law Contract Law Follow the Settlements Clause Construction of Insurance Contracts Aggregation Provisions Standard of Proof in Reinsurance Claims Back to Back Coverage

Case Brief

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Parties

Tokio Marine Europe Insurance Ltd

Claimant

Novae Corporate Underwriting Ltd

Defendant

Procedural Posture

Commercial Insurance/reinsurance Dispute / Judgment on Preliminary Issues

Legal Issues

  1. 1 Does the Retrocession reinsure TMEI for its liability to ACE in respect of local policies?
  2. 2 Is 'Loss Occurrence' in the Retrocession to be construed in the same manner as 'Occurrence' in the Master Policy?
  3. 3 Did Novae agree under the Retrocession to follow the settlements of ACE or of TMEI?

Ratio Decidendi

The Retrocession covers TMEI's liability under both the Master Policy and local policies; 'Loss Occurrence' is to be construed identically to 'Occurrence' in the Master Policy; Novae is bound to follow settlements made by ACE; the standard of proof is arguability; and Novae is bound by ACE's determination on aggregation provisions, provided the settlement arguably falls within the Retrocession and ACE acted honestly and businesslike.

Court Disposition

Judgment for the Claimant on all five preliminary issues.

Orders

  • Retrocession covers TMEI's liability under both Master Policy and local policies.
  • 'Loss Occurrence' construed as 'Occurrence' in Master Policy.