WISE Underwriting Agency Ltd v Grupo Nacional Provincial SA
| Jurisdiction | England & Wales |
| Judge | Lord Justice Rix,Lord Justice Longmore,Lord Justice Peter Gibson |
| Judgment Date | 20 July 2004 |
| Neutral Citation | [2004] EWCA Civ 962 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A3/2003/2212 |
| Date | 20 July 2004 |
[2004] EWCA Civ 962
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
COMMERCIAL COURT
The Honourable Mr Justice Simon
Royal Courts of Justice
Strand,
London, WC2A 2LL
The Right Honourable Lord Justice Peter Gibson
The Right Honourable Lord Justice Rix and
The Right Honourable Lord Justice Longmore
Case No: A3/2003/2212
Mr Gavin Kealey QC and Mr Huw Davies (instructed by Messrs Beaumont and Son) for the Appellant
Mr Nigel Cooper (instructed by Messrs Waltons & Morse) for the Respondent
This appeal lies between London reinsurers and a Mexican insurance company and concerns the reinsurance of cargo cover for a Cancun retailer's imports of luxury goods from Miami. The essence of the dispute is the reinsurers' complaint that they were not told that the retailer imported Rolex and other high-value branded watches. The reinsurers avoided their contract on that basis. At trial there were issues of misrepresentation, materiality, waiver, inducement, and affirmation. Apart from misrepresentation, the judge decided each of those issues against the reinsured. On appeal, the reinsured has not pursued the issue of materiality, nor given much prominence to the issue of inducement. The real battle-ground has been waiver and affirmation.
The reinsured acknowledges that the appeal is one of fact, and makes no complaint of the judge's statements of law. Nevertheless, the appeal has raised interesting points relating, in the case of the waiver issue, to the application of principle to fact, and, in the case of the affirmation issue, to the court of appeal's position as a finder of fact.
The reinsurance contract
There was no policy. The reinsurance contract was made on about 28 December 2000 on the basis of a slip presentation, which, unusually, was not even initialled by the reinsurers' underwriter. The slip provided as follows:
"Cedant: Grupo Nacional Provincial, S.A.
Insured: Perfumeria Ultra S.A. De C.V.
Locations: 1) Classical Gift Inc
9431 S.W. 65 Street
Miami…
2) Fragrances of the Word [sic] Inc.
10840 S .W. Street
Miami
3) Jewelry Time Inc
13228 N .W. Street
Miami…
Period: From December 31 st, 2000 to December 31 st, 2001
Type: Facultative cargo reinsurance. With monthly declarations
Interest: All real and personal property of any kind and description, including property but not limited to property of other in care, custody or control of the insured or for which the insured has assumed responsibility. All the shipments done by the insured consistent in but not limited to, cosmetics, perfumery, gifts, jewelery, lladró, (kind of porcelain) accessories, and in general on any type of supplies related to the Insured's activity and in which it has an insurable interest.
Coverage:
• Ordinary Transit Risk terrestrial, maritime and air
• Total and/or partial theft.
• Wetting
• Spots
• Pollution
• All risk of cargo as per GNP wording
• Warehouse to warehouse
• Theft by bulk by hole [sic]
• Breakage, bump, bend or crack
• Oxidation
• Contact with other charges [cargoes?]
• Spillage
• Strikes and civil commotion
• Loading and unloading manoeuvres.
• Damage for derailed. [sic]
• Lay up for 15 fifteen days
Activity: Commercialisation of Perfumes, gifts lladro, and jewelery.
Transportation: Any kind of usual transportation, terrestrial, maritime and air.
Geographic Limit: From Miami Flo. US to Cancun Q.R. Mexico
From warehouse to any store in Cancun city.
Maximum Limit of US$ 1,500,000.00 per shipment
Responsibility: US$ 50,000.00 per vehicle inside Cancun
Annual Estimated: US$ 17,000,000.00.
of Shipments:
Conditions: …
• Cancellation clause (60 days)
• Cooperation clause as per GNP wording"
The slip contained an Information clause as follows:
"Information: Loss Record:
Nil for the last 12 Twelve years
Maximum amount and rate of the merchandise:
- Perfumes and cosmetics: US$700,000 US$250,000
- Gifts (crystals, porcelain, leather bags, clothes, silverware) : US$250,000 US$150,000
- Clocks: US$1,000,000 US$200,000
- Jewelry (gold, diamonds, stones, precious pearls and semiprecious and over and lose [sic]: US$350,000 US$200,000.
- Clocks: less expensive piece: US$40. Most expensive piece US$18,000 and average cost US$1,500.
- Jewelry: more expensive piece (rare circulation) ; more expensive piece: US$30,000; Most expensive set US$50,000 average cost
- Maximum Transport: US$1,500,000 (high season).
- Average: US$500,000
- Average Transport US$500,000 per trip
- During the month: Three trips…"
There was also information concerning the logistics of the transport and security measures, eg that at Miami consolidation was made for all the North American and European suppliers.
The judge, Simon J, found that the meaning of various parts of the slip conditions and information was not clear, even allowing for spelling mistakes. It was common ground that the slip, which had as a matter of fact been translated from Spanish and was on the notepaper of the Mexican producing brokers, Grupo Internacional de Reaseguro ("GIR"), was clearly the product of a non-English speaker.
The parties, and the placing of the reinsurance
The original insured was, as stated in the slip, Perfumeria Ultra SA ("Perfumeria") of Cancun and Miami. Its Mexican insurer, the second largest insurance company in Mexico, was Grupo Nacional Provincial SA ("GNP"), here the appellants. The reinsurers were a group of Lloyd's syndicates for whom WISE (Underwriting Agency) Ltd, here the respondents, entered into the slip contract (the "reinsurers"). The reinsurers' cargo underwriter was Mr Roger Bennett.
GIR acted as GNP's reinsurance brokers. In May 2000 it approached Collard & Partners ("Collards"), London reinsurance brokers to place reinsurance on the London market. Vic Lancaster-Smith was employed by Collards as a placing broker with responsibility inter alia for Latin American and, in particular, Mexican reinsurance business. With his assistance, Collards ceded the Perfumeria risk at that time to HIH Insurance (Asia) Ltd ("HIH") under an open cover. In November 2000 Mr Lancaster-Smith received instructions to cancel the HIH cover as at the end of 2000 and seek new reinsurance. On this occasion, he employed a facility from WISE under which Collards could place, on a facultative basis, marine cargo reinsurance in respect of business primarily originating from the Americas. He negotiated the placing with Mr Bennett, whom he knew well. He had done business with him over a number of years.
The WISE open cover described the "Voyage" as "principally but not limited to sendings to/from/within Americas, Central/South and United States of America" and the "Interest" as "All Goods and/or Merchandise and/or Cargo of every description…" However, there was a long list of "Exclusions" which had been negotiated with Mr Bennett. The list included livestock, bloodstock, jewellers block, furriers block, cigarettes, fresh flowers, fish catch, mobile phones and computers and computer parts, and stock and/or goods at retail premises. Many of those exclusions had been listed at Mr Bennett's own request.
The slips prepared by GIR for presentation to GNP and reinsurers respectively were in different languages. The slip presented to GNP was in Spanish, and also included additional information concerning packaging which (as translated for the purposes of the trial) was inter alia as follows:
"Packaging:
A safety container is consolidated in Miami, which is not opened until it reaches the shop of the insured in Cancun. Subject to inspection by the authorities.
There is no way of identifying the type of goods; there are no tags, only the form of handling and form of stowage. The packages comply with the manufacturer's indications.
"Watches:
Packed in two types of packing as follows:
a.1) Special cases made in the factory
a.2) Watches in collective cases protected on an average of 10 in each pack. The packaging hold approximately 120 watches.
a.3) Rolex, each watch comes with its case and each packaging holds approximately 48 watches in packs of 16 rows, 3 rows high."
The judge commented:
"9. Two points should be noted. In the Spanish version of the Slip Presentation sent to GNP the word Relojes is always used. It seems that in Spanish Relojes can mean either watches or clocks. The Interpreter in the action before me distinguished the meaning by using reloj de pulsera for 'watch' and reloj de pared for 'clock'. In the Spanish version what was intended by the word Relojes would have been resolved by the specific reference to 'Rolex' in Clause a.3). However, as already noted, that Clause was omitted from the English version. In the English version the word 'clocks' was used throughout. One of the issues in the case is whether the word 'clocks' in the English version should have been understood to cover 'watches', and whether the use of the word 'clocks' was such as to put the Reinsurers on enquiry."
The judge was not able to determine why there was this difference between the Spanish and the English versions. He did not accept a possible explanation, given by an employee of GIR, that an employee of GNP had asked for the packing information not to be included out of concern that it would not be complied with. However, he did accept that the translation of relojes as clocks instead of watches (or perhaps clocks and watches as one translation had it) appeared to be a mistake, compounded by the omission of the packing sections which revealed that Rolex watches were being transported (at para 24). Since...
To continue reading
Request your trial
-
Synergy Health (UK) Ltd v CGU Insurance Plc & 3 others
...1 Lloyd's Rep 476, per Parker LJ at 511-2 and Stephenson LJ at 529. In the subsequent decision of the Court of Appeal in WISE Ltd v Grupo Nacional Provincial SA [2004] 2 Lloyd's Rep 483; [2004] EWCA Civ 962, at paragraph 110, Longmore LJ approved the following passage from MacGillivray at ......
-
Dalecroft Properties Ltd v Underwriters Subscribing to Certificate Number 755/BA004/2008/OIS/00000282/2008/005
...2015) para 17-089. This paragraph (as it stood in the 10th edition) was approved by the majority of the Court of Appeal in WISE Ltd v Grupo Nacional Provincial SA [2004] EWCA Civ 962; [2004] 2 Lloyd's Rep. 23 See eg Doheny v New India Assurance Ltd [2004] EWCA Civ 1705, [2005] Lloyd's Rep......
-
Involnert Management Inc. v Aprilgrange Ltd & Others Ais Insurance Services Ltd (First Third Party) Oamps Special Risks Ltd (Second Third Party)
...summarised in Insurance Corp of the Channel Islands v Royal Hotel Ltd (No 2) [1998] Lloyd's Rep IR 151, 161–3, and WISE Underwriting Agency Ltd v Grupo Nacional Provincial SA [2003] EWHC 3038 (Comm); [2004] 2 All ER (Comm) 613 at para 46 (affirmed on appeal on this issue at [2004] EWCA Ci......
-
William Francis Rendall and Combined Insurance Company of America
...would elicit the fact; and iii) the further inquiry is not made. See WISE (Underwriting Agency) Ltd v Grupo Nacional Provincial [2004] Lloyd's Rep IR 764 (CA). 96 Reinsurers say that if there has been no fair presentation of the risk, the reinsurer will not have been put on enquiry, citing ......
-
For A Surprised Reinsurer, That First Step Can Be A Big One
...See Allendale Mut. Ins. Co. v. Excess Ins. Co., 992 F. Supp. 278, 282-85 (S.D.N.Y. 1998). Wise Ltd. v. Grupo Nacional Provincial SA, [2004] EWCA (Civ) 962 [1]-[45] See, e.g., Allendale Mut. Ins., supra; Compagnie de Reassurance D'Ile de Fr. V. New England Reinsurance Corp., 57 F.3d 56 (1st ......
-
The Insurance Act 2015: Rebalancing the Interests of Insurer and Assured
...Rich and CoAG vPortman [1996] 1 Lloyd’s Rep 430; [1997] 1 Lloyd’s Rep 225; WISE Underwriting AgencyLtd vGrupo Nacional Provincial SA [2004] 2 Lloyd’s Rep 483.38 WISE Underwriting Agency Ltd vGrupo Nacional Provincial SA ibid.39 See Insurance Bill Explanatory note, at [14]Rob Merkin and Özle......
-
OF SHIFTING WINDS – INSURED'S PRE-CONTRACTUAL DUTY OF GOOD FAITH IN SINGAPORE
...UK Insurance Act 2015 on Singapore Insurance Law and Practice” Singapore Law Gazette (October 2016). 66[2011] 1 Lloyd's Rep 589. 67[2004] 2 Lloyd's Rep 483. 68(1766) 3 Burr 1905 at 1909. 69 (1782) 99 ER 548. 70 James Allan Park, A System of the Law of Marine Insurances (Butterworth, 4th Ed,......