Insurance warranties and “basis of contract” clauses: Genesis Housing Association v Liberty Syndicate Management Ltd [2012] EWHC 3105 (TCC)

On 13 November 2012, Akenhead J handed down judgment in Genesis Housing Association v Liberty Syndicate Management Ltd [2012] EWHC 3105 (TCC). Richard Sage appeared for the successful Defendant.

The case concerns a policy of latent defects insurance and a related insolvency endorsement. The Judge held that a “basis of contract” clause contained in the proposal form was incorporated into the contract of insurance. The Judge held that the effect of the basis clause was to create a warranty as to the accuracy of the answers given. The Claimant had failed to identify the contractor correctly in the proposal. The inaccurate answer constituted a breach of warranty and rendered the policy void from its inception. The Judge also considered the interaction of the basis clause in the proposal form, and the effect of various conditions in the policy itself. The Judge accepted the Defendant’s construction of the policy terms, and the effect of the contractor’s insolvency on the policy of latent defects insurance itself.

The judgment is available by clicking here.

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