Prifti and Others v Musini Sociedad Anonima De Seguros Y Reaseguros
| Jurisdiction | England & Wales |
| Judge | Mr Justice Andrew Smith,MR JUSTICE CHRISTOPHER CLARKE |
| Judgment Date | 06 May 2005 |
| Neutral Citation | [2003] EWHC 2796 (Comm),[2005] EWHC 832 (Comm) |
| Docket Number | Case No: 2003/366,Case No: 2003 FOLIO 366 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 06 May 2005 |
[2003] EWHC 2796 (Comm)
The Honourable Mr Justice Andrew Smith
Case No: 2003/366
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Roger Masefield (instructed by Reynolds Porter Chamberlain) for the Claimants
Stephen Phillips (instructed by Simmons & Simmons) for the Defendant
Hearing dates: 14 November 2003
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The Hon. Mr Justice Andrew Smith
The defendant in these proceedings, Musini Sociedad Anonima de Seguros y Reaseguros ("Musini"), applies for an order that the Court has no jurisdiction over the claim made by the claimants (to whom I shall refer as the "Reinsurers") and that the proceedings should therefore be set aside; and alternatively for an order under article 28 of Council Regulation no 44/2001 (the "Regulation") that the proceedings be dismissed or stayed. The application also indicated that Musini would seek a stay on the grounds that England is not the appropriate forum to determine the claim, but this argument is not pursued before me (although Musini reserve their position should the matter go further). The basis of Musini's applications are (i) that the relevant reinsurance contract made between them and the Reinsurers contained a jurisdiction agreement to the effect that claims relating to it would be heard in Spain, and (ii) that, these proceedings and proceedings brought against Musini in Spain being "related actions" under article 28, this Court may and should dismiss or stay this action.
This action was brought on 16 April 2003. The Reinsurers seek declarations that they are not liable to Musini as reinsurers of cover written for the Spanish football club, Real Sociedad de Fulbol SAD ("Real Sociedad"), in respect of personal accident and sickness of its players for a period from 5 December 2000 to 4 December 2001. A claim has been brought against Musini by Real Sociedad in respect of one of their players, Frederic Peiremans. Mr Peiremans, having played no competitive matches since September 2000 and having been taken off injured when he played in a friendly match in April 2001, retired from playing professional football in September 2001. In these proceedings, the Reinsurers claim (i) a declaration that they are entitled to avoid the reinsurance contract and have validly done so (the "avoidance claim"), and (ii) further and alternatively, a declaration that they are not liable under the reinsurance contract in relation to the claim concerning Frederic Peiremans (the "pre-existing condition claim").
The contractual background to the dispute is as follows: in December 1999, Musini wrote insurance (the "1999/2000 insurance") for Real Sociedad in respect of their players suffering personal accidents or sickness for a period of 12 months from 5 December 1999. They were reinsured as to 98% of the risk under a reinsurance contract (the "1999/2000 reinsurance") placed in the London market, the leading underwriter being CIGNA Re. The evidence is that Musini would not have contemplated underwriting the risk without such reinsurance. Musini wrote a second such policy (the "2000/01 insurance") for Real Sociedad for a period of 12 months from 5 December 2000, and took out reinsurance (the "2000/01 reinsurance") as to 98% of the risk with the Reinsurers.
The 1999/2000 reinsurance was a slip agreement, and no wording was produced. The terms of the slip included the following:
Type: Personal Accident Reinsurance
Form: Slip Reinsurance NMA 1779a plus wording as agreed by Leading Underwriter on 10 December 1999
…
Conditions: 1) Full reinsurance clause:-
Being a reinsurance of and warranted subject to the same terms and conditions (excluding limits and rates) as and to follow the settlements of the Reassured.
The above full reinsurance clause is amended to include the following claims Control clause:
) It is understood and agreed that the Reinsurers shall have the sole control of the adjustment, negotiations and settlement of all claims.
It is further agreed that:
(a) the Reinsured upon being advised of any claim(s) or of any possible claim(s), or upon their being advised of any situation likely to result in any claim(s), shall give immediate notice thereof to the Reinsurers,
(b) the Reinsured shall furnish the Reinsurers with all information and papers in connection with such claim(s) and co-operate in the settlement, negotiation and adjustment thereof.
) 24 hour cover including Flight risk and Hijacking, as original.
…
5) Pre existing conditions exclusion clause, as Original."
The 2000/01 reinsurance was also a slip agreement. Its terms included the following:
"Form: Slip Reinsurance NMA 1779a
…
Conditions: 1) Full Reinsurance Clause:-
Being a reinsurance of and warranted subject to the same terms and conditions (excluding limits and rates) as and to follow the settlements of the Reassured.
The above full reinsurance clause is amended to include the following Claim Control Clause:
It is understood and agreed that the Reinsured shall have the sole control of the adjustment, negotiations and settlement of all claims.
It is further agreed that:
(a) the Reinsured upon being advised of any claim(s) or of any possible claim(s), or upon their being advised of any situation likely to result in any claim(s), shall give immediate notice thereof to the Reinsurers;
(b) The Reinsured shall furnish the Reinsurers with all information and papers in connection with such claim(s) and co-operate in the settlement, negotiation and adjustment thereof.
) 24 hour cover including flight risk, as original.
…
4) Pre existing conditions exclusion Clause, as Original."]
…
The wording referred to in the 1999/2000 reinsurance slip and agreed by the leading underwriter on 10 December 1999 (and it will be observed that there was no comparable reference in the 2000/01 reinsurance slip) was a translation from the Spanish prepared by the brokers, Willis Faber and Dumas Limited ("Willis Faber"), of conditions of the underlying insurance. It was initialled by the leading underwriter, and included the following:
i) A term headed "24 hour risk", referred to in the reinsurance slip, that Musini should cover any accident in either professional or private life.
ii) A term headed "Pre-existing Conditions", excluding cover "in the event of death or permanent total disablement arising from, traceable to or accelerated by a pre-existing condition", subject to an exception if a duly completed proposal form and a medical report had been presented.
iii) Under the heading Special Conditions at article 17, a jurisdiction clause in these terms: "If any or both of the contracting parties decide to bring action before the Courts, this should be made before the Court with jurisdiction over the Policy Holder's Address in Spain, this being the only competent court to hear actions arising from this insurance contract, as long as it reside in the Spanish territory. In any other situation, the Court with jurisdiction over the Insurer's address shall be the only competent (sic)".
According to a witness statement of Mr Luis Castellanos, Musini's manager of the Northern Zone of Spain, the 1999/2000 insurance also included, at article 15 of the "policy wording", a simultaneous payments clause whereby it was agreed that Musini would be obliged to meet its obligations when it had received payment from its reinsurers for the reinsured proportion of the risk. This is not article 15 of the conditions initialled by the leading underwriter: it is apparent that the 1999/2000 insurance included other conditions which are not in evidence.
Further, perhaps more surprisingly, the 2000/01 insurance contract is not in evidence. However, it included the following terms:
i) A jurisdiction clause which (according to Prof Dr Juan Sanchez-Calero Guilarte, a Professor of Commercial Law at the Complutense University at Madrid and a practising Spanish lawyer, who gave expert evidence for Musinreads as follows in translation: "Competent Jurisdiction. The Competent Judge to hear any claims under the Policy will be the judge of the domicile of the Insured in Spain, notwithstanding any agreement to the contrary. Should the Insured have its domicile in another country, it will be required to nominate a domicile in Spain for the purposes of this article."
ii) A simultaneous payments clause and a pre-existing conditions clause similar to those of the 1999/2000 insurance.
I was invited by Mr S J Phillips, who represented Musini, to assume that otherwise the 2000/01 insurance was in similar terms to the 1999/2000 insurance. I do not find that an easy assumption in view of the differences which are apparent: the jurisdiction clause not only had different wording but was found at article 13 of the General Conditions in the later policy whereas it was article 17 of the Special Conditions in the 1999/2000 insurance. In any event, it is not necessary to my decision to draw any inference about the other terms of the 2000/01 insurance.
By a claim dated 27 March 2003, which was filed on 1 April 2003, Real Sociedad brought proceedings in the Court of San Sebastian against Musini, making a claim for E3,606,072.63 (including interest) under the 2000/01 insurance on the basis that Frederic Peiremans was permanently incapable of playing football. Cover in respect of Mr Peiremans had been added to the 1999/2000 insurance in about August 2000, and was included in the 2000/01 insurance. In their claim Real Sociedad, referring to...
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