Reinsurance - Reinsurance pools and limitation periods

The Court of Appeal in July handed down its decision in the appeal from the judgment of Mr Justice Langley in Companhia de Seguros Imperio v Heath (REBX) Ltd [1999] Lloyd’s Rep IR 571 : the appeal will be reported in Lloyd’s Rep IR shortly. A series of claims were made by the claimant reinsurers against the defendants, brokers who operated a reinsurance pool of which the claimants were members. The period of cover which gave rise to the claims had terminated by April 1983, and in fact the vast majority of the risks written had terminated in 1979 and 1980, but the claim form itself had not been issued until September 1995. The timings gave rise to a number of questions of limitation law, which were dealt with as preliminary issues by Mr Justice Langley. The appeal to the Court of Appeal was against only one of Mr Justice Langley’s rulings. The action proceeded on assumed facts, and none of the allegations made has been tested as to its substance in any court.