Walton Insurance Ltd v Agrichem Ltd and Manufacturers &amp General Ltd

• Jurisdiction: Bermuda
• Judgment Date: 27 March 1987
• Date: 27 March 1987
• Docket Number: Civil Jurisdiction 1986 No: 431
• Court: Supreme Court (Bermuda)

In the Supreme Court of Bermuda

Collett, J.

Civil Jurisdiction 1986 No: 431

BETWEEN:-

Agrichem Limited (formerly Agrichem Insurance Company Limited)

and

Manufacturers and General Limited (formerly Manufacturers and General Insurance Company Limited

and

Manufactured Housing Limited (formerly Manufacturers Housing Company Limited)

Mr. Hargun for the Plaintiffs

Mr. Milligan Whyte for the Defendant

Nova (Jersey) Knit Ltd v Kammgarn Spinnerei GmbHUNK [1977] 1 Lloyds Rep. 463

SL Sethia Liners Ltd v State Trading Corp of India LtdUNK [1986] 2 All ER 395

'The Fuoshan Maru'UNK [1978] 1 Lloyds Rep. 24

Eagle Star Insurance Co Ltd v Yuval Insurance Co LtdUNK [1978] 1 Lloyds Rep. 357

Arbitration Act 1986 s. 8

Claim under reinsurance treaties — Application for summary judgment — Cross-Application for stay of all further proceedings — Triable issue

JUDGMENT

Collett, J.

The three Plaintiff companies in this action claim liquidated sums totalling $575,207.41 from the Defendant Company persuant to the terms of three separate reinsurance treaties in identical terms each dated 8th October, 1980. Appearance having been entered to the specially endorsed writ, the Plaintiffs have applied for summary judgment under Order 14 of the Rules of The Supreme Court 1952. There is a cross-application by the Defendant for a stay of all further proceedings persuant to section 8 of the Arbitration Act 1986.

Article XIV of the treaties in question constitutes a valid reference to arbitration of ‘any unresolved difference of opinion between the Reinsurer (the Defendant) and the Company (the respective Plaintiff)’. It is common ground that this is not a domestic arbitration agreement and that the pre-conditions laid down under section 8(1) of the Act have been complied with. The Court is therefore obliged to stay these proceedings unless satisfield as to one or other of the exceptions laid down in the subsection, the only relevant one being ‘that there is not in fact any dispute between the parties with regard to the matter agreed to be referred’.

The Plaintiffs rely upon a provision of Article IX (c) of the treaties to the effect that ‘upon receipt of a definitive statement of net loss and adjustment expense from the Company, the Reinsurer shall pay promptly to the company the Reinsurer's portion of net loss and Reinsurers portion of adjustment expense if any’. It is common ground that statements covering the net amounts claimed in the action were sent to and received by the Defendant early in 1986 and that they do arise out of losses and adjustment expenses covered by the treaties. Indeed in one instance the...