English court rules on liability insurance claim from Spain
06 September 2022
A recent anti-suit case injunction issued by the English courts to restrain a third party from pursuing a direct action claim against a liability insurer in the courts of an EU country is the first example of a significant legal development made possible by Brexit.
In a complex legal battle between London and Madrid, the English Commercial Court granted an anti-suit injunction based on an arbitration clause in an insurance policy involving QBE Europe and another v Generali Espaňa de Seguros Y Reaseguros  EQHC 2062 (Comm).
The case from Spain arose from a 2016 incident involving the undersea power cable linking Mallorca and Menorca which was allegedly damaged by the €1.6 million ($2.3 million) superyacht “Angara”.
Red Eléctrica de Espaňa, the owner of the cable, made an insurance claim and its insurers (Generali) paid it €7.7 million. Generali then sought to recover this from the Angara’s insurers QBE UK.
QBE relied on a provision in the Protection & Indemnity (P&I) policy which made any dispute relating to its liability subject to English law and London arbitration. QBE argued Generali had to abide by the arbitration clause contained in the insurance contract when seeking to enforce its terms. The Commercial Court concluded that the circumstances warranted an anti-suit injunction.
Andrew Tettenborn, a professor at Swansea Law School, wrote in a blog for the Institute of International Shipping and Trade Law: “In this, one of the first post-Brexit P&I cases to come to the English courts, QBE won hands down.”
This anti-suit injunction was directed against a party which was not pursuing a claim under the policy but instead was pursuing a claim under a statute, and the party applying for the anti-suit injunction - relying on the London arbitration clause in the policy- denied it was a party to the policy.
QBE had been the insurer of the yacht in 2016, but in 2020 there had been a reorganisation of QBE’s business which meant that QBE Europe had taken over the insurance. In February 2022, Generali started a court claim against QBE UK in Madrid.
Generali also said its claim was a tortious claim under the Maritime Navigation Act in Spain, and not a contractual claim under the policy, which meant that the arbitration clause in the policy did not apply.
QBE UK and QBE Europe, applied to the English courts for an anti-suit injunction to restrain Generali from pursuing the claim against QBE UK in Spain, and to prevent it from starting similar court proceedings against QBE Europe.
The judge concluded that QBE UK could be granted the anti-suit injunction, even though it denied being a party to the policy, because Generali was claiming against it under that policy. In addition, QBE Europe could be granted the injunction, even though Generali was not claiming against it, because there was a real risk that Generali would seek to join QBE Europe to the Spanish court proceedings in the future.
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