The Claimants insured property (a shop) under a continuous insurance policy from 2002 to 2006 through its broker. Unknown to the Claimants, the cover was provided by three different insurers: the First Defendant in 2002/03 year, Brit in 2003/04 year, and the Third Defendant between 2004 and 2006. Subsidence occurred on the property at the end of 2003 as the Brit policy began. Water damage then occurred in the Autumn of 2004. On discovery that there was more than one insurer the Claimants withdrew their claims against the First and Third Defendants and claimed on the Brit policy for damage and business interruption in early 2005. Brit refused to pay and so the Claimants commenced legal proceedings. On the issue of when the damage-causing event took place, Mr Justice Mackie noted that although there was a considerable “step-change” in October 2004 to what was a gradual process, he followed the experts findings that the damage first occurred back in 2003 when the initial subsidence happened.
General Condition 5 of the Brit policy (which was a condition precedent to liability) required the Insured to give “immediate notice to the Insurers on the happening of any injury or damage in consequence of which a claim is or may be made under this policy“. Mr Justice Mackie confirmed that the test as to whether notice had been given was objective. Following his finding that the initial damage had occurred in late 2003, the judge found that the Claimants had therefore failed to give “immediate” notice as required by the policy and therefore ruled that Brit had no liability for the compensation sought.
