Legal Affairs / General

Cyber risks again

When can an insured institute action to recover its excess from a third party wrongdoer?

The doctrine of subrogation literally means the substitution of one party for another as creditor. The doctrine is an incidence of the law of indemnity.

Prescription of business interruption insurance claims (UK)

Prescription arose in a UK case dealing with a business interruption claim arising from damage to the insured’s gym facilities when the premises were broken into and vandalised. Damage was caused to the toilets and wash hand basin and there was flooding of the premises. Exercise bikes, furniture, mirrors and other equipment were damaged and various items including computer equipment and audio equipment was stolen.

Unconditional performance guarantees are unconditional

The Supreme Court of Appeal has again emphasised that a performance guarantee in terms of which the guarantor undertakes to pay an amount if the contractor fails to perform the required work is unconditional. The beneficiary of the guarantee is not obliged to prove an entitlement under the principal contract before it can make a demand on the guarantee. A claim on the guarantee was permissible regardless of disputes under the main contract. In this case, the performance guarantee had been granted on the basis that it was subject to the sole approval of the beneficiary.