(1) Aspen Insurance UK Ltd (2) Brit Insurance Holdings Ltd (3) David Andrew Constable v Pectel Ltd [2008] EWHC 2804 (Comm)

A condition in an insurance policy requiring immediate written notice of any occurrence that might give rise to a claim, taken with a further condition that Insurers’ liability was conditional on the observance of the terms and conditions of the policy, was a condition precedent to liability under the policy.  

Aspen v David Constable: The claimant insurance companies sought a declaration that they had no liability to the Insured in relation to a claim that the Insured was liable for a fire in a British Telecom deep-level tunnel facility. Preparatory work on the North Tunnel had commenced on Monday 22 March 2004 in the crossover section where both tunnels met. The work was stopped on Friday, 26 March 2004, when BT and AMEC called off the works on the grounds that there had been no pre-start meeting. The defendant had 7 employees working in that area, who packed up their equipment and left site that afternoon. On the morning of 29 March 2004, there was a fire in that area. The Insured’s Mr Murray attended the site, but there was no suggestion that any blame would be laid at the Insured’s door. The cause of the fire had not, however, been investigated at that time. The Insured complied with subsequent requests for information in relation to that investigation, but never advised his brokers/Insurers of a possible claim. In January 2007, AMEC wrote to the Insured, notifying it of a possible claim by BT against it. The Insured said they never received that letter, although a letter written by the Insured to AMEC clearly acknowledged receipt of it. The claim was finally notified in March 2007 when a letter was received from AMEC’s lawyers attaching BT’s letter of claim against AMEC and suggesting that the Defendant should notify its Insurers.

The judge held that the Insured had a contractual obligation to give written notice of the fire and a possible claim for an indemnity by early 2004. Further, if he was wrong on that date, then notice should nevertheless have been given by November 2004, or at the very latest immediately on receipt of the letter in January 2007.