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Caudle -v- Sharpe (1995) LRLR 433

A Lloyd’s underwriter, Mr Outhwaite, had underwritten many run-off contracts with disastrous results. Claims were made under the syndicate’s professional indemnity insurance. Those insurers in turn claimed under their re-insurance. The issue turned on the meaning of “each and every loss arising out of one event”. Was Mr Outhwaite’s state of mind an event? Or was there an event each time Mr Outhwaite negligently accepted a run-off contract? Lord Justice Evans identified three requirements of a relevant “event”, namely (1) a common factor which can properly be described as an event, (2) which satisfies the test of causation, and (3) which is not too remote for the purpose of the clause. He held that Mr Outhwaite’s “blind spot” or “his failure to conduct the necessary research and investigation” did not fall within the natural and ordinary meaning of the word “event” except by reference to each and every occasion when he entered into a run-off contract. Thus it was held that there were 32 events. -

J Rothschild Assurance v Collyear & Others Commercial Court

Plaintiffs sought to identify cases of pensions mis-selling and notified insurers of the 2,500 cases they had under review. Held that they were more than justified in saying that there were circumstances which might give rise to a claim against them. - Citation: [1999] 1 Lloyds Rep. IR 6