Reinsurance: declaratory relief

In Al Buhaira National Insurance Co v Arab War Risks Insurance Syndicate [2026] DIFC CA 003 the Dubai International Financial Court of Appeal has upheld in part and overturned in part the lengthy decision of His Excellency Justice Michael Black KC sitting in the Dubai International Court of First Instance, [2026] Lloyd's Rep IR 345. In outline, a reinsured who had avoided the underlying insurance but remained in litigation with the assured sought declarations from the court as to the liability of the reinsurers and of its right to recover defence costs.

The judge had to consider a number of important issues, including the determination of the law applicable to the reinsurance, the reinsurers' liability for defence costs, the possible right of the reinsurers to avoid the reinsurance and whether a claim had been made in time. The appeal to the Court of Appeal was confined to insurable interest, the terms of the cover and defence costs.