Liability insurance: pay to be paid

In MS Amlin Marine NV v King Trader Ltd and Others [2024] EWHC 1813 (Comm); [2024] Lloyd's Rep IR 703 the third-party claimants against an insolvent charterer sought to recover from the charterer's insurers under the Third Parties (Rights Against Insurers) Act 2010. The policy contained a pay to be paid clause.

The claimants raised a series of arguments designed to overcome the effect of the pay to be paid clause, each of which was dismissed. Foxton J did express some disquiet over the operation of such clauses, but recognised that there was nothing the common law could do to mitigate the clear terms in which they were phrased.