Genesisuk.Net Ltd v Allianz Insurance Ltd
| Jurisdiction | England & Wales |
| Judge | Judge Mackie,JUDGE MACKIE |
| Judgment Date | 07 November 2014 |
| Neutral Citation | [2014] EWHC 3676 (QB) |
| Docket Number | Case No: 2011 Folio 1597 |
| Court | Queen's Bench Division |
| Date | 07 November 2014 |
[2014] EWHC 3676 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
LONDON MERCANTILE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
His Honour Judge Mackie QC
Case No: 2011 Folio 1597
Andrew Butler (instructed by Edwin Coe LLP) for the Claimant
Ben Quiney QC (instructed by DAC Beachcroft LLP) for the Defendant
Hearing dates: 12 to15, 19 and 20 May and 31 July 2014
Judge Mackie QC:
The Claimant, Genesisuk.net Limited ("Genesis"), seeks to recover losses arising from a fire that occurred on 26/27 February 2011 ("the Fire") at Genesis' premises at 24a Pantglas Industrial Estate, Bedwas, Caerphilly, CF83 8DR ("the Unit"). Genesis was insured under a policy issued by the Defendant, Allianz Insurance Plc ("Allianz"). Allianz has avoided the policy claiming that Genesis' director, Mr Roe, either deliberately set, or procured the setting of, the Fire. Genesis and Mr Roe strenuously deny this serious claim. This question of fact is the only real issue in the case apart from disagreements about quantum. The facts are however complex.
The trial
The Claim is for at most some £220,000 but it has been hard fought. The Court has 27 bundles and heard from 9 of the 12 factual witnesses for the Claimant whose statements have been put forward. These were Mr and Mrs Roe, Mr Alan Riegler, Mr Jon Osborne, Ms Claire Hopkins, DS Court, PC Rees, Mr Nathan Rees-Taylor and Mr Andrew Sargent. The Defendant had no factual witnesses.
The parties also had experts in four disciplines as follows:
Facts about the Fire and the Unit agreed or not much in dispute
| Discipline | Claimant's Expert | Defendant's Expert |
| Fire Investigation | Rebecca Jewell | David Robbins |
| Fuel Analysis | Rebecca Jewell | Paul Jowett |
| CCTV | Neil Millar Simon Nash | Graham Dunne |
| Forensic Accountancy | Stephen Thompson | Kevin Harding |
Although the central issue is fiercely contested many of the facts are not in dispute. It is important, as I see it, to start with the facts directly relating to the Fire and to come to those relating to motive and circumstantial evidence later.
Genesis is a company owned and run by Dennis and Victoria Roe. Its business is the supply of alarm and security products. It is currently in a Creditors' Voluntary Arrangement ("CVA"). Mr and Mrs Roe are equal shareholders. Mr Roe has worked in the security industry since 1996. According to Mr Roe, Genesis was incorporated on 26 September 2008 as a result of an approach made by him to Tyco Safety Products, described by its UK Sales Director Alan Riegler, a witness, as "the world's largest fire and security company". In November 2008 Genesis entered a distribution agreement with Tyco giving it exclusive distribution rights over Wales and Southern England in respect of Tyco products and in January 2009 it took a lease of Unit 1A (later renumbered Unit A, 24 Pantglas Estate by the local council). This is a conventional industrial estate unit. There is a useful plan which was used at trial. The workshop and storage areas are about 13 metres long from shutter doors at the front to the back wall. This area contained shelf units about 2 metres long and 0.6 metres wide. There was a gap of about 4.8 metres from the roller door to the nearest rack. To the side of the storage area as part of the Unit was a separate door.
There is dispute between the parties about the financial state of Genesis and its business at the time of the Fire to which I will refer later.
On 23 February 2011, following a review of insurance arrangements, the policy of insurance was incepted with Allianz. Section 1A on p.6 (Property Insurance), Section 2A on p.11 (Business Interruption), and General Condition 8 on p.29 (Fraud) are the relevant provisions but their effect is not in dispute. The sums insured were £122,000 on stock and £250,000 for Business Interruption with a 12 month indemnity period (reduced from 24 months cover for the previous year). It is common ground that if Mr Roe was involved in deliberately causing a fire there is no cover and I need not address the details of the policy.
On the Saturday night of 26/27 February 2011 a fire took place at the Unit caused by arson. At about 00.10 hours on 27 February 2011 a person shown on CCTV footage introduced what started the Fire underneath the roller shutter door at the front of the unit. The Fire Joint Statement records this and other common ground. The parties agree that diesel was the accelerant and that it was found on boxes and shelving within the Unit at the time of the Fire. The external CCTV cameras show a man outside the Unit from about 23:58 to 00:18. The Fire is recorded by the internal cameras as starting at about 00:20. The external cameras show the man, amongst other things, appearing to push a hose under the roller doors. This seems to have been how he set the Fire.
The Unit's alarm receiving centre, EMCS, alerted the Roes to the alarm going off. The EMCS log records that Mrs Roe answered the telephone saying that Mr Roe was not there. The Fire Service was called and it soon extinguished the Fire. The six firemen on the scene were not aware of a smell of diesel at the Unit. Mr Roe also went to the Unit and took photographs at about 3am. These show diesel stains on cartons which could only have originated from inside the Unit but which had been taken outside by the Fire Service. The experts agree in the Joint Statement that the stains on the cartons photographed outside the Unit must have been present before the Fire occurred. More photographs were taken by Mr Gale (Genesis' Loss Adjuster) of Allianz's investigators on Monday 28 February. These show staining on some of the boxes still inside the Unit (some of those not taken out by the firemen) as well as on those outside.
Mr Robbins, the Defendant's fire investigator and an expert witness, examined the scene on 4 and 7 March 2011. On 4 March he identified oily staining on the shelves and the boxes on those shelves as well as on the cardboard boxes outside the Unit. He took 4 samples, which confirmed that the stains were evidence of diesel. It is now agreed that all 4 samples evidence diesel but it is disputed whether one of these is from the same source as the other three. It is agreed that the staining patterns are consistent with pouring of diesel and that three are from the same source, being DAR2, DAR9, and DAR13. There is a disagreement as to the source of DAR12 and whether any difference to the other samples is material. It is agreed that the diesel is petroleum based, not bio-diesel, thus eliminating one reason put forward by Mr Roe at an earlier point for why diesel might be within the Unit. There is disagreement between the experts about the extent and significance of the diesel.
Mr and Mrs Roe were in the Unit on Saturday afternoon 26 February and I shall refer to that when dealing with the CCTV evidence below. The internal cameras show that Mr Roe and his wife had been present on two occasions at the Unit between 15:00 and 18:52 that day. During that time they brought items from home and were piling things near the roller door, where the Fire appears to have been set. As Genesis has accepted more recently the Roes also took things out of the Unit. The cameras do not cover the area at the middle/back of the workshop where the diesel was later discovered. The EMCS log shows no entry, exit or alarm between 18:52 and the Fire. There is no other evidence of any forced entry into the Unit or that anyone was inside from when Mr Roe left the Unit at 18:52 on 26 February and the occurrence of the Fire at or about 00:20 on 27 February.
There were four CCTV cameras; two external (Cameras 1 and 2), and two internal (Cameras 3 and 4). They were motion-activated, that is to say, they would respond and begin recording in the event of a sufficient degree of motion within their field of view. Once the motion stopped the camera would continue to display the scene as it stood. The cameras could also be set to run continuously and had been in this mode until changed by someone on 16 February 2011. There are unexplained gaps in the footage which Allianz says is consistent with someone deliberately interrupting it or, as Genesis contends, with defects or inadequacies in the equipment.
On Monday 28 February Mr Priest, Genesis' landlord went to the Unit, found water escaping from a copper pipe and stopped this by shutting the stopcock. Both sides suggest that someone must have gone to the Unit and caused the water to start to escape. The experts agree that the pipe ruptured before or during the Fire but the stop cock was shut before the Fire. So someone opened it after the Fire and before Mr Priest went to the Unit, possibly to wash away evidence. Mr Roe says that the Unit was not secure after the Fire because the Fire Service cut the padlock to the shutter doors. There is no evidence of a further break in but on or around 2 nd or 3 rd of March there was minor pilfering amongst the debris outside the Unit. The police log records Mr Roe calling to say that the Fire Damaged Unit had been looted by people he believed to be travellers. The looters apparently drilled out the pedestrian shutter door locks rather than force open the main roller shutter.
Both the pedestrian door and the main roller shutter were shut and remained so when Mr Robbins visited on 4 th and 7 th March 2011. It was not possible to open the roller shutter as the chain pulley had apparently slipped. Mr Robbins says that he noticed this and that Mr Roe confirmed that this had happened. The roller shutter door was not opened until May 2011. An email of 4 May indicates that it was still firmly shut but one of 22 May that it was by then capable of being opened if only with the help of two men.
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