On 1 April 2020, the Supreme Court handed down judgment in Aspen Underwriting v. Credit Europe Bank NV [2020] UKSC 11, a decision concerning the application of the Brussels Regulation (Re-Cast) 1215/2012 in matters ‘relating to insurance’. Upholding the appeal, the Court ruled that the English courts had no jurisdiction over claims brought by insurers against the defendant bank to recover proceeds paid out following a settlement agreement of a claim on a hull policy, holding that the bank could only be sued in a matter relating to insurance in its Member State of domicile.
Three issues of general application are considered in the judgment, which followed a two-day hearing before a panel of 7 Justices in November 2019.
First, applying and extending the principle in The Jay Bola [1997] 2 Lloyds Rep. 279 (CA), the Supreme Court held that an assignee of contractual rights was not bound by a jurisdiction agreement contained in the assigned contract unless the assignee commenced legal proceedings. If not, the assignee was to be sued in its Member State of domicile.
Secondly, the Court rejected the proposition that the interposition of a settlement agreement between the insurers and insured was sufficient to change the legal character of a claim to recover the proceeds from a ‘matter relating to insurance’. In doing so, it held that: (i) matters ‘relating to insurance’ are wider in scope than claims for breach of an insurance contract; and (ii) in any event in the case of an alleged insurance fraud, the claim would inevitably entail a breach the insurance contract.
Thirdly, the Supreme Court overruled the courts below and held that, absent a binding jurisdiction agreement, an insurer may only sue a policyholder, beneficiary, or insured in its Member State of domicile in matters ‘relating to insurance’. There was, in particular, no exception to the rules of jurisdiction based on the economic characteristics of the defendant.
The Court was invited, but declined, to overrule the decision in Kleinwort Benson Ltd v. Glasgow City Council (No. 2) [1999] 1 AC 153 (HL) that a claim in unjust enrichment for mistake was neither a matter ‘relating to contract’ nor a matter ‘relating to tort’ for the purposes of the European framework.
Steven Berry QC and Adam Board, instructed by Kirsty MacHardy and Kate Law of Campbell Johnston Clark, acted for the successful third defendant and cross-appellant.
