January 03, 2025 court of first instance - Orders
Claim No: CFI 013/2024
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
AL BUHAIRA NATIONAL INSURANCE COMPANY
Claimant
and
ARAB WAR RISKS INSURANCE SYNDICATE
Defendant
ORDER WITH REASONS OF JUSTICE MICHAEL BLACK KC
UPON reviewing the Case Management Order dated 25 September 2024 (the “Case Management Order”)
AND UPON the Defendant’s Request to Produce dated 8 October 2024
AND UPON the Claimant’s Request to Produce dated 9 October 2024
AND UPON the Defendant’s Supplemental Request to Produce dated 11 October 2024
AND UPON the Claimant’s Objections to the Defendant’s Request to Produce dated 15 October 2024
AND UPON the Defendant’s Response to the Claimant’s Request to Produce dated 15 October 2024
AND UPON the Claimant’s Objections to the Defendant’s Supplementary Request to Produce dated 17 October 2024
AND UPON the Defendant’s Application No. CFI-013-2024/2 for a Document Production Order in respect of the Defendant’s SRTP dated 22 October 2024
AND UPON the Claimant’s Application No. CFI-013-2024/3 for a Document Production Order dated 23 October 2024
IT IS HEREBY ORDERED THAT:
1. Requests 1, 2, 3, 4, 5, 6, 7, 9 of the Defendant’s Application No. CFI-013-2024/2 are refused.
2. Requests 1-3, 4, 5, 6, 7, 8 of the Claimant’s Application No. CFI-013-2024/3 are refused
3. Costs of the Applications shall be costs in the case.
Issued by:
Hayley Norton
Assistant Registrar
Date of Issue: 3 January 2025
At: 11am
SCHEDULE OF REASONS
1. By a Case Management Order dated 25 September 2024 it was directed that should either party be dissatisfied with any objection to a Request to Produce documents (“RTP”) it may apply to the Court for a Document Production Order (“DPO”) by 4pm (GST) on 22 October 2024.
2. The Defendant filed its RTP on 8 October 2024 and the Claimant filed its RTP on 9 October 2024.
3. The Defendant filed a Supplemental RTP (“SRTP”) on 11 October 2024.
4. On 15 October 2024 the Claimant filed its objections to the Defendant’s RTP, and the Defendant filed its Response to the Claimant’s RTP.
5. On 17 October 2024 the Claimant filed its objections to the Defendant’s SRTP.
6. On 22 October 2024 the Defendant made application for a DPO in respect of theDefendant’s SRTP.
7. On 23 October 2024 the Claimant made an application for a DPO supported by the Second Witness Statement of Leonard Omeed Soudagar dated 22 October 2024.
8. On 5 November 2024 the Claimant filed the Third Witness Statement of Leonard Omeed Soudagar dated 5 November 2024 in response to the Defendant's DPO application.
9. On 8 November 2024 the Defendant filed the Third Witness Statement of Gregg Hammond dated 8 November 2024 in response to the Claimant's DPO application.
10. On 18 November 2024 the Claimant filed the Fourth Witness Statement of Leonard Omeed Soudagar dated 18 November 2024 in response to the Third Witness Statement of Gregg Hammond.
THE DEFENDANT’S APPLICATION
11. All Request Numbers relate to the SRTP
Request No. 1
12. The Defendant seeks:
Documents and documentation relating to the Underlying Proceedings, (including, without limitation, all pleadings, applications, witness statements, expert reports and submissions) made by the parties involved, including the following:
(a) The expert report of Peter Townsend, including all of its exhibits.
(b) The first and second witness statements of Mahmoud Hasan Shalab, including all of its exhibits.
(c) The expert report of Richard Malone with all of its exhibits.
(d) The Claimant’s written submissions for the trial before Justice Robert French.
(e) All documents relating to the Claimant’s jurisdictional application.
(f) A transcript of the trial before Justice Robert French.
13. It claims that given the Underlying Policy was reinsured by the Defendant pursuant to the Reinsurance Contract, the documents relating to the Underlying Proceedings are necessary to establish the Claimant’s pleaded position under the Underlying Policy.
14. The request is refused. The judgment of Justice Robert French dated 26 September 2024 sets out with considerable particularity the Claimant’s pleaded position under the Underlying Policy. If that is all the Defendant wishes the ascertain there is no reason to look beyond the judgment.
15. Further, the difference between “documents” and “documentation” is not understood.
Request No. 2
16. The Defendant seeks:
Documents and documentation relating to the Insurers’ underwriting files with respect to the Hull and Marine Policy (the “Hull Policy”) and the Marine Hull War Risks Policy (the “War Policy”)
on the grounds that the Claimant argues that it is entitled to indemnification pursuant to the Underlying Policy. These documents are therefore necessary to establish the Claimant’s pleaded position.
17. The Claimant’s pleaded case is not that it is entitled to indemnification pursuant to the Underlying Policy but that to the extent that it is found liable to the Insured under the War Policy, it is entitled to be indemnified by the Defendant in like amount under the Reinsurance Contract.
18. No claim is made in respect of the Hull Policy. Nonetheless the Defendant submits that although the Hull Policy is not, itself, directly the subject matter of the Claimant’s claim under the Reinsurance Contract, disclosure of documents requested with respect to the Hull Policy is also necessary, since the Hull Policy (and any reinsurance of the Hull Policy) was governed by English law, and/or the costs claimed by the Claimant against the Defendant appear to relate to, and/or include, the Claimant’s costs of defending the Underlying Insured’s claims under the Hull Policy.
19. I cannot see how the mere fact that the Hull Policy or any reinsurance of the Hull Policy may be governed by English law renders any document in respect of the Hull Policy relevant to these proceedings.
20. The Defendant claims that the costs claimed by the Claimant against the Defendant appear to relate to, or include, the Claimant’s costs of defending the Underlying Insured’s claims under the Hull Policy. The burden of proving its claim rests on the Claimant. It is obliged to produce documents showing that the costs claimed relate to the Claimant’s costs of defending the Underlying Insured’s claims under the War Policy. If it fails to do so the claim will fail. It is not necessary for the Defendant to seek documents establishing the Claimant’s pleaded position.
21. The request is therefore refused.
Request No. 3
22. The Defendant seeks:
Documents and documentation relating to the Insurers’ claims (and investigative) files with respect to the Hull Policy and the War Policy on the same grounds as Request No. 2.
23. The Request is refused for the same reasons as under Request No. 2.
Request No. 4
24. The Defendant seeks:
Documents and documentation relating to the Insurers’ reinsurance placement files, including (but not limited to) any documents held by (i) the Insurer; (ii) a reinsurance broker; or (iii) agent, with respect to both the Hull Policy and the War Policy
on the same grounds as Request No. 2.
25. I accept that this Request relates to the Reinsurance Contract. Since no claim is made in respect of the Hull Policy, the documents sought with respect to the Hull Policy are irrelevant.
26. The Defendant has not established that documents relating to the Insurers’ reinsurance placement files held by a reinsurance broker or agent with respect to the War Policy are within the possession, custody or control of the Claimant.
27. The relevance of the Claimant’s reinsurance placement files is not explained. They do not appear necessary to establish the Claimant’s pleaded position.
28. The request is refused
Request No. 5
29. The Defendant seeks:
Documents and documentation relating to any reinsurance claims, or reinsurance claim payments, or reinsurance settlements, with respect to the Hull Policy (as opposed to the War Policy)
on the grounds set out at paragraph 18 above.
30. The request is refused for the reasons appearing at paragraphs 19 and 20 above.
Request No. 6
31. The Defendant seeks:
Documents and documentation evidencing the relationships between Mr Abdullah Juma Al Sari and/or Horizons LLC and the Claimant (whether in their capacities as director/officer, shareholder, or policyholder), including the Claimant’s registers of directors and officers, and the Claimant’s registers of shareholders and beneficial owners, at all material times on the grounds that the Claimant argues that Mr Abdullah Juma Al Sari was not involved in the decision of taking the risk during the conclusion of the Reinsurance Contract, or in the terms of the Reinsurance Contract. The requested documents will reflect what knowledge Mr Abdullah Juma Al Sari had, or ought to expected to have had, and the extent of his relationship with the Claimant and/or Horizons LLC.
32. I accept that there is an issue on the pleadings as to whether the Claimant knew that the m/t BETA was not trading or that the vessel was not classed with Buraeau Veritas before the Reinsurance Contract was concluded. If the object of the request is to identify what knowledge Mr Abdullah Juma Al Sari had, or ought to expected to have had, before the Reinsurance Contract was concluded, the request is too vague and unfocussed.
33. The request is refused.
Request No. 7
34. The Defendant seeks
Documents and documentation evidencing the relationships between Mr Abdullah Juma Al Sari and the Claimant
on same grounds as Request No. 6.
35. This appears to be a partial repetition of Request No. 6 and is likewise refused.
Request No. 9
36. The Defendant seeks
All documents evidencing the Claimant’s attempts to secure payment by any of the Reinsurers that provided reinsurance cover with respect to the Hull Policy (as opposed to the War Policy)
on the grounds on the grounds set out at paragraph 18 above.
37. The request is refused for the reasons appearing at paragraphs 19 and 20 above
THE CLAIMANT’S APPLICATION
Requests Nos. 1-3
38. The Claimant seeks
(a) A complete copy of the Defendant’s underwriting file for the Reinsurance Contract, including all Documents recording communications sent or received by the Defendant in connection with the acceptance of the risk at inception and thereafter on each renewal;
(b) Copies of all Documents recording communications sent or received by the Defendant which evidence the parties’ agreement annually on the terms of the reinsurance contracts concluded annually;
(c) Copies of all Documents recording communications sent or received by the Defendant which evidence the parties’ express choice that English law would apply to the Reinsurance Contract;
on the grounds that:
i. there is a dispute as to the terms of the Reinsurance Contract and, in particular, whether it contained a “follow the fortunes” for “follow the settlements” clause. The Claimant considers that the terms are evidenced by a Placement Document issued annually whereas the Defendant contends that only a Cover Note issued in 2015 evidences the same;
ii. further, the Defendant has pleaded that the parties expressly chose and agreed that the law of England and Wales would apply to the Reinsurance Contract; and
iii. the Claimant denies that there was any such express agreement. The Claimant considers that the requested documents will demonstrate the Claimant’s position that there was no express agreement that English law would apply. The requested documents will also demonstrate that it was not in the Defendant’s contemplation that any other law other than the federal law of the UAE would apply to the Reinsurance Contract.
39. The Claimant has clarified that it seeks internal communications and notes on the underwriting file. It does not seek the correspondence sent by the Defendant to the Claimant in the course of the underwriting exercise and which has already been produced in the course of these proceedings (by either party).
40. The Defendant objects to the Request on the grounds that:
(a) the Claimant has not provided a statement as to whether the requested documents are in its possession, custody or control, as is required by part 28.17(4)(a) of the RDC;
(b) insofar as the requested Documents include communications between the Claimant and the Defendant, they are already in the Claimant’s possession, custody or control; and
(c) the Defendant has either shared such requested documents in its Standard Production of Documents, exhibited them to its pleadings, and/or otherwise referred to them in its Response to the Claimant’s Request for Further Information.
41. I consider the request to be unfocussed. The entirety of the Defendant’s underwriting file cannot be relevant to the terms of the Reinsurance Contract and in particular the applicable law.
42. Indeed, I am unpersuaded that any internal communications and notes would be relevant to the ascertainment of the terms of the Reinsurance Contract as the issue to be resolved is what was agreed not the subjective intention or understanding of the individual parties.
43. The Requests are refused.
Request No. 4
44. The Claimant seeks
A complete copy of the Defendant’s claims file, including all documents recording communications sent or received by the Defendant in connection with the Claimant’s claim under the Reinsurance Contract
on the grounds that:
(a) the Defendant denies that the Claimant is entitled to be indemnified by the Defendant against the costs and expenses incurred in connection with (i) seeking to avoid and/or limit its liability under the Underlying Policy or (ii) proceedings brought by or against the Insured in respect of the same; and
(b) the Claimant requires sight of the Documents requested to show that the position adopted by the Defendant is inconsistent with its standard practice of (i) exercising claims control over claims notified under policies issued by the Claimant and reinsured by the Defendant, whether or not such claims trigger cover, and (ii) indemnifying costs incurred by the Defendant in respect of the same.
45. The Claimant maintains it has pleaded that there is a market practice that the costs claimed by the Claimant in these proceedings are to be indemnified by the Defendant as 100% facultative reinsurers of the Claimant. The Defendant denies that there is such a market practice. The Claimant asserts that the requested documents will demonstrate that the position advanced by the Defendant is false and cannot be sustained in circumstances where it is the Defendant’s own practice to indemnify such costs. Such documents are therefore directly relevant and material to the issues in dispute and the outcome of the proceedings and must be disclosed.
46. The Claimant does however accept that it is not entitled to sight of legally privileged documents.
47. The Defendant objects to the Request on the grounds that:
(a) the Request is immaterial and irrelevant (ground 1 – Rule 28.28 of the RDC). The Claimant’s explanation of the Request, i.e. alleged inconsistencies between the Defendant’s position and its standard practice, has not been pleaded in these proceedings. As such, the Defendant maintains that the requested documents are irrelevant and immaterial to the points at issue, as pleaded; and
(b) the category of documents requested contains legally privileged communications (ground 2 – Rule 28.28 of the RDC).
48. I fail to see the relevance of the documents requested. Whether or not there is a market practice is a different issue from the Defendant’s own practice, which may or may not conform to market practice. Market practice will have to be proved by evidence.
49. The Request is refused.
Request No. 5
50. The Claimant seeks
Copies of all Documents recording communications sent or received by the Defendant to its retrocessionaires notifying and then concerning the Claimant’s claim under the Reinsurance Contract
on the grounds set out at paragraph 44 above.
51. The Defendant repeats its objections set out at paragraph 47 above and additionally on the grounds that claims control at the retrocessionaire level rests with the retrocessionaires, and is entirely irrelevant to claims control at the reinsurer level.
52. The Request is refused for the reasons set at paragraph 48 above and additionally because the Defendant’s relationship with the retrocessionaires is irrelevant to any pleaded issue.
Request No. 6
53. The Claimant seeks
A copy the Defendant’s internal claims handling guidelines and procedures, and/or all documents to that effect
on the grounds set out at paragraph 44 above.
54. The Defendant repeats its objections set out at paragraph 47 above and additionally on the grounds of commercial and technical confidentiality (ground 5 – Rule 28.28 of the RDC).
55. The Request is refused for the reasons set at paragraph 48 above.
Request No. 7
56. The Claimant seeks
A complete copy of the Defendant’s underwriting file in relation to Claimant’s policy number ZRHULL/ 000007/17/AI, reinsured by the Defendant (the Bin Hendi Policy)
on the grounds set out at paragraph 44 above.
57. The Defendant repeats its objections set out at paragraph 47 above and additionally on the grounds that the documents requested pertain to an underwriting file for a separate claim, for a separate policy, for a separate original insured, and which does not form part of any pleaded issue.
58. The Request is refused for the reasons set at paragraph 48 above and additionally because the documents requested are irrelevant to any pleaded issue.
Request No.8
59. The Claimant seeks
A complete copy of the Defendant’s claim file (Defendant’s reference: H 1440/2019) in relation to the claim notified (and paid) under the Bin Hendi Policy, including all documents recording communications sent or received by the Defendant in connection therewith
on the grounds set out at paragraph 44 above.
60. The Defendant repeats its objections set out at paragraphs 47 and 57 above and additionally on the grounds that:
(a) the Claimant has not provided a statement as to whether the requested documents are in its possession, custody or control, as is required by Rule 28.17 (4)(a) of the RDC, or, in the alternative, a statement of the reasons why it would be unreasonably burdensome for it to produce such documents (RDC 28.17(4)(b)); and
(b) the requested documents, insofar as they include communications between the Claimant and the Defendant in relation to the claim notified under the Ben Hendi policy, are already in the Claimant’s possession, custody or control.
61. The Request is refused for the reasons set out at paragraph 58 above.
Costs
62. As I have dismissed the applications of both the Claimant and the Defendant in their entirety, I consider the most appropriate order to be that the costs of the applications shall be costs in the case.
