By Owen Reid
The High Court has allowed two companies and an employee to be added as plaintiffs in an insurance indemnity dispute between Leisure Management Corporation Limited and AIG Europe (Ireland) Limited.
Mr Justice Michael Peart ordered that Genport Limited, Calla Associates Limited and Christopher O’Reilly be joined to the proceedings. Genport and Calla are wholly-owned subsidiaries of Leisure Management, while O’Reilly was an employee of one or both companies and was named on the insurance policy.
Leisure Management had taken out the policy with AIG and later sought indemnity for sums arising from damages and costs awarded against Genport and Calla in separate actions. A judgment against Genport was also made against O’Reilly on a joint and several basis.
AIG disputed liability. Its defence relied in part on a policy term stating that, after the insurer disclaimed liability, a claim would be treated as abandoned unless referred to arbitration within 12 months. AIG said liability had been disclaimed on August 8th, 2001 and January 17th, 2006. It also argued that certain claims were barred by the Statute of Limitations.
The plaintiff maintained that Genport and Calla were themselves insured under the policy and sought to add them, together with O’Reilly, so that all relevant claims could be determined in the same proceedings.
Mr Justice Peart held that the proposed plaintiffs fell within the rules permitting parties to be joined where their presence may be necessary to resolve all issues in a case. He said it was at least arguable that Leisure Management itself was not the correct party to seek some of the indemnity claimed.
The judge did not decide whether the arbitration clause defeated the claims or whether any claim was statute-barred. Those matters required evidence and legal argument at trial.
Finding no significant prejudice to AIG from the additions, the court ordered all three parties to be joined as plaintiffs.