Duties under a follow clause: lead underwriters left in the dark?
In the recent case of San Evans Maritime Inc v Aigaion Insurance Co  EWHC 163 (Comm), the Commercial Court held that a ‘follow clause’ had the effect of binding Aigaion to a settlement agreed by Lloyd’s syndicates under a separate insurance policy even though the settlement agreement expressly stated that the syndicates were not acting in their capacity as lead underwriters when they signed the agreement. The decision can be explained, however, by the circumstances of this particular case and the clear wording of the ‘follow clause’.
The dispute arose from the grounding of the vessel St Efrem in Brazil in July 2010. The insurance position for the vessel was as follows: a 50 per cent share had been insured with three Lloyd’s syndicates — Catlin, Ark and Brit (‘the Lloyd’s Policy’); a 30 per cent share had been insured with Aigaion (‘the Aigaion Policy’); and the remaining 20 per cent share had remained uninsured.
Critically, the Aigaion Policy contained the ‘follow clause’: ‘agreed to follow London’s Catlin and Brit Syndicate in claims excluding ex-gratia payments’…
Click on the link below to read the rest of the Addleshaw Goddard briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Addleshaw Goddard
News from The Lawyer
Briefings from Addleshaw Goddard
InCredit — new controller form for intragroup transactions; PPI complaints set to continue; and more
Addleshaw Goddard’s weekly publication provides information on current retail finance issues, regulatory and legislative developments, market watch and ASA adjudications.
Data Issues Roundup — firm warned to stop nuisance text messages; EU ruling on CCTV; ICO's privacy seals; and more
Addleshaw Goddard has released the 19 January 2014 issue of its Data Issues Roundup .
Analysis from The Lawyer
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all
Could Slater & Gordon achieve its stated aim of becoming a top consumer brand by acquiring Pannone?