November 2006 

Courts’ jurisdiction to hear appeals – CGU INTERNATIONAL INSURANCE PLC & OTHERS v ASTRA ZENECA INSURANCECO LTD, Court of Appeal, 16 October 2006

Astra Zeneca Insurance Co Limited (“Astra Zeneca”), the captive insurer of Astra Zeneca plc, insured the group’s global property and liability risks (the “Insurance Contract”). CGU International Insurance plc reinsured Astra Zeneca’s liability in respect of personal injuries and property damage (the “Reinsurance Contract”). The Reinsurance Contract was expressly subject to English law and jurisdiction. The Insurance Contract contained no express choice of law, but it was seemingly accepted by the parties that English law governed it. It also contained a “USA Service of Suit” clause which bound insureds operating within the USA to submit to a court of competent jurisdiction within the USA. The Reinsurance Contract contained a London arbitration clause.

November 2006

DLA Piper Reinsurance Bulletin November 2006

Current Issues: Directors' duties under the Companies Act 2006; EU study on auditor liability;

                       Mesothelioma claims; Consultation on Part 7 transfers; NEWCOB and MiFID;

                       Supervising insurance groups under Solvency II; WTC decision upheld. 

Case Notes     : A question of attribution; Knowledge loss.

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Law-Now

November 2006

Scope of NEWCOB and rulebook changes

On 31 October, in its latest consultation papers CP06/19 and 06/20, the FSA released its proposals to replace the existing COB rulebook with a new regime (NEWCOB); this will implement the COB requirements in MiFID and also FSA’s own review which is designed to simplify the conduct of business regime for designated investment business. It also sets out other proposed sourcebook changes to Systems and Controls (SYSC), Dispute Resolution: Complaints (DISP), Training and Competence (TC) and Supervision (SUP).

October 2006 

Claims handling costs should not be given priority over other debts of an insolvent company – CENTRE REINSURANCE INTERNATIONAL CO AND OTHERS v FREAKLEY AND OTHERS, House of Lords, 11 October 2006.

Several tort claims were made against T & N Limited (“the Insured”) arising out of its use of asbestos. As a consequence it became unlikely to be able to pay its debts. Administrators were appointed for the purposes of approving a scheme of arrangement under section 425 of the Companies Act 1985.