Analysing the claim

In Wickham Van Eyck v Norwich Union Insurance Ltd [2009] EWHC 2625 (Comm) the assured procured a policy which provided cover for the assured’s costs in litigation. Cover applied in a number of situations, one of which was that the claim made by the assured against the third party arose out of a contract for the provision of services. The question – familiar in the context of liability insurance – was whether the claim made by the assured against the third party fell into that category. Simon J held that the manner in which the assured has framed his claim against the third party is not conclusive of the matter.

The policy

The claimant, WVE, a firm of architects, was insured by the defendant insurers under a lengthy policy documents which covered a number of contingencies. The dispute in question related to cover for ‘Legal Liabilities – Commercial Legal Protection’ up to the sum of £500,000. That part of the policy provided an indemnity to WVE for legal costs incurred by it in pursuing a claim for damages where success was more likely than not and where liability was disputed. Contingency 5, headed ‘Contract Disputes’, was in the following terms: