K/S Merc-Scandia XXXXII v Lloyd's Underwriters [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | Aikens J. |
| Judgment Date | 23 June 2000 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 23 June 2000 |
Queen's Bench Division
Before Mr Justice Aikens.
Insurance - insured producing forged letter on matter not affecting liability - insurers cannot avoid liability
The insured's production of a forged letter to underwriters to support their application, on the insured's behalf, to dispute the jurisdiction of the English court, in a claim brought by a third party, was not material constituting a breach of the insured's post-contract duty of utmost good faith.
Therefore, the underwriters were not entitled to avoid an insurance policy and decline to satisfy a third party's claim against the insured for risk covered under the policy for the insured's deliberate misrepresentation when the misrepresentation was not material to affect a valid claim of the third party.
Mr Justice Aikens so held in the Queen's Bench Division when he gave judgment for the plaintiff, K/S Merc-Scandia XXXXII, who sought to recover from the defendants, Lloyd's Underwriters subscribing to Lloyd's Policy No 25T 1954 87, Ocean Marine Insurance Company Ltd and 35 other defendants, money due under a judgment recovered against the defendants' insured.
The defendants had contended that they had avoided the policy for breach of the duty of utmost good faith by the insured's producing a forged letter to help the insurers relating to a jurisdiction application.
Mr Richard Millet for the plaintiff; Mr Andrew Lydiard for the defendants
MR JUSTICE AIKENS said that even if the claim against the assured had remained contested, the fact that the assured had forged the letter would not have influenced the outcome on the issue of...
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