Bloxham stockbrokers, which says it is facing claims of more than €20 million over a bond which collapsed in value, has sued its insurers alleging it was under-insured.
Bloxham, Exchange Place, IFSC, Dublin, has alleged insurers Robertson Low Insurances Ltd were negligent in allegedly under-insuring it between June 2008 and June 2009 for a total €3 million, plus a €1.27 million limit for claims prior to June 2007.
Robertson Low claims Bloxham was alleging it had retained the insurer between May 2001 and June 2009 to place its Financial Institutions Direct Financial Loss and Civil Liability insurance on an annual basis.
Bloxhman contended that business was placed for the period June 2008 to June 2009 by the defendant through a Lloyds broker and underwritten by Lloyds’ underwriters subject to a limit of an aggregate €3 million, the defendant said.
Bloxham had claimed it notified its insurers in June 2009 of circumstances which might give rise to claims against it relating to the sale of the Saturns Inv Europe plc FRN 05/07/2031 €1000 notes (the Saturns bond).
It was claimed the total claims exceeded €20 million which greatly exceeded the firm’s limit of indemnity for the policy period and that the defendant had failed to obtained adequate insurance. Bloxhman claimed it had undertsood it had insurance cover for the policy period of €3 million for each and every claim, without an aggregate limit, the defendant said.
Rossa Fanning, for the insurer, applied to fast-track the case by having it transferred to the Commercial Court yesterday but Mr Justice Peter Kelly refused the applicaiton on grounds of delay in seeking transfer.
Mr Fanning said Bloxham was essentially claiming it was under-insured, his side denied the very serious claims, including negligence, and wanted the case dealt with speedily. His side had been awiating a statement of claim before bringing the transfer application.
Declan McGrath, for Bloxham, opposed transfer on grounds of delay by the defendant. His client was being sued by several parties and was awaiting crystallisation of those claims.
Mr Justice Kelly said Bloxham was being sued by investors who claim they lost the bulk of their capital after investing in Saturn bonds.
The quantification of any losses suffered by Bloxham would not be clear until that litigaiton was out of the way although the liability of the insurers could be decided before that, he noted.
The defendant insurer had claimed its five month delay in bringing the transfer application related to awaiting a statement of claim from Bloxham but, if the matter was truly urgent, could have moved earlier, the judge said. In the circumstances, he was refusing transfer.
