Waiver

In Liberty Insurance (PTE) Ltd v Argo Systems FZE [2011] EWCA Civ 1572, insurers sought to overturn a finding at first instance that they had waived a breach of warranty. If they lost on that issue, then insurers claimed to be entitled to recover damages for misrepresentation. The Court of Appeal’s decision is considered by Katie Powell of 4 New Square.

Liberty: the facts

In March 2003, a floating casino sank in the Caribbean Sea. The vessel was, effectively, owned by Argo (the respondent on appeal). The vessel was insured under a marine insurance policy underwritten by the appellant. The policy had been produced by a US broker, DSI, and placed in England by LSR. Under the policy, Argo gave the following warranty: ‘[w]arranted no release, waivers or “hold harmless” given to Tug or Towers’. Arrangements were made for the vessel to be towed from to India. The contract for the tow of the vessel provided for extensive mutual exceptions of liability and cross-indemnities between the tug owner and Argo.