Superholdings Holdings Plc and Others v Sun Alliance and London Insurance Plc t/a Sun Alliance Insurance Group and Others
| Jurisdiction | Ireland |
| Judge | Mr. Justice Fennelly |
| Judgment Date | 21 February 2014 |
| Neutral Citation | [2014] IESC 14 |
| Docket Number | Appeal No. 140/01 |
| Court | Supreme Court |
| Date | 21 February 2014 |
[2014] IESC 14
THE SUPREME COURT
Fennelly J.
McKechnie J.
Laffoy J.
BETWEEN
SUPERWOOD HOLDINGS PLC & ORS v SUN ALLIANCE & LONDON INSURANCE PLC T/A SUN ALLIANCE INSURANCE GROUP & ORS 1995 3 IR 303 1995/13/3385
SUPERWOOD HOLDINGS PLC & ORS v SUN ALLIANCE & LONDON INSURANCE PLC T/A SUN ALLIANCE INSURANCE GROUP & ORS (NO 3) 2004 2 IR 407 2004 2 ILRM 124 2004/48/10930 2004 IESC 19
LOUGH NEAGH EXPLORATION LTD v MORRICE & ORS 1999 4 IR 515
SUPERWOOD HOLDINGS PLC & ORS v IRELAND UNREP 8.9.2011 2011 ECHR 1309 (APPLICATION NO 7812/04)
EUROPEAN CONVENTION ON HUMAN RIGHTS & FUNDAMENTAL FREEDOMS ART 6(1)
RSC O.58 r6
RSC O.58 r8
RSC O.28 r11
CONSTITUTION ART 34.4.6
GREENDALE DEVELOPMENTS LTD (IN LIQUIDATION), IN RE; FAGAN & MALONE v MCQUAID 2000 2 IR 514 2001 1 ILRM 161 2000/9/3223
High Court - Insurance - Indemnity - Liability - Quantum - Lodgement - Appeal - Fire damage - Fraud - Gross exaggeration of claim - Costs - Mareva injunction - Security for costs - Leave to re-enter appeal – New evidence - Constitution of Ireland
Facts: These proceedings concerned an application for, inter alia, an order to re-enter an appeal that was dismissed by order of the Supreme Court on the 15th March 2004 and leave to admit new evidence. Proceedings had originally been brought by the appellants against the first three respondents and one other party - all of which were insurers of the appellants - on the 28th June 1989. In 1987, there had been a fire in premises owned by appellants in Bray, County Wicklow, and a claim was made for the resulting loss against the insurers; however, liability was repudiated on the basis that the claim had been so grossly exaggerated that it constituted a breach of the terms of the insurance policies. This argument was accepted by the High Court and a finding of fraud was made against the appellants. The action was, therefore, dismissed. This decision was subsequently appealed to the Supreme Court where it was found that the finding of fraud could not stand and the claim was remitted to the High Court to determine quantum.
Prior to the re-trial being heard, all four insurers made lodgements into Court. The appellants subsequently settled their claim with the appellants, but the lodgements of the other three insurers – the first three respondents in this appeal – were rejected. The appellants were ultimately awarded less than the respective lodgements meaning they were entitled to the retrial costs up to the date of the lodgement but the first three insurers were entitled to their costs from the date of their lodgement. The High Court also granted a Mareva injunction freezing the appellant”s assets up to IR£5,000,000. The appellants then initiated an appeal of these decisions and the Supreme Court made an order for security for costs. The appellants, however, were unable to provide that security and the appeal was dismissed. The present application was then brought following the issue of the notice of motion on the 27th August 2013.
Held by Fennelly J. (with McKechnie J. and Laffoy J. concurring) that the appellant”s application was misconceived because the appeal had been dismissed by a final order of the Supreme Court made on the 15th March 2004, meaning there was no appeal pending before the Court. As a result, it was held that the Court did not have to jurisdiction to make an order to re-enter the appeal. For the same reason, leave to admit new evidence could not be granted.
It was also pointed out that although Article 34, section 4(6) of the Constitution of Ireland provides that ‘the decision of the Supreme Court shall in all cases be final and conclusive’, Irish jurisprudence made it clear that a final decision could potentially be set aside in very special and unusual circumstances. The case of Re Greendale Developments Ltd. (No 3)) [2000] 2 I.R. 514 was cited because it discussed the circumstances in which the Supreme Court will entertain an application to set aside one of its own final orders. However, no application of that sort has been made by the appellants. The present application was, therefore, dismissed.
The Court has before it an application which seeks a number of orders in respect of an appeal, in particular that the appeal be re-entered and to admit new evidence, in the above named proceedings, although that appeal was dismissed by order of this Court on 15th March 2004. These entire proceedings, it has to be said, have a truly extraordinary and unfortunate history.
Nonetheless, the present application needs to be explained in the context of this hugely protracted litigation. It will then be necessary to consider the orders sought in the Notice of Motion.
In the account now given, the appellants will be described under the general title of Superwood.
The history commences in 1987 with a fire at a premises owned by Superwood in Bray, County Wicklow. Superwood had insurance policies for consequential loss. It claimed the total resulting loss was in excess of IR£2 million and made claims under its insurance policies. The two sets of insurers repudiated liability at an early stage, in reliance on a condition in the policy and on the ground of fraud, in effect that the claim had been so exaggerated that it could not have been made honestly. Superwood initiated High Court proceedings against the insurers on 28th June 1989 seeking damages for wrongful repudiation of the insurance policies.
The resulting trial in the High Court took place over 116 days. O'Hanlon J delivered judgment on the 13th, 14th and 15th August and the 12th November, 1991, dismissing Superwood's claim with costs. The judgment ran to some 423 pages and the transcripts to 8,500 pages. The trial judge had stated during the course of the trial that he would determine the issue of liability first, leaving over his decision on quantum. The judge found that Superwood had committed such extensive breaches of the terms of the insurance policies as to lead inexorably to a finding of fraud. In view of his finding that Superwood had been fraudulent any insurance benefit was therefore forfeited and it was not necessary to assess damages.
Superwood appealed the judgment of the High Court to the Supreme Court, where the hearing took 16 days. Denham J. delivered the principal judgment of a unanimous court. The appeal was allowed and the matter remitted to the High court for a re-trial. See: Superwood Holdings plc v Sun Alliance & London Insurances plc [1995] 3 IR 303. Denham J held that the insurers were not entitled to rely on a particular condition (Condition 4) of the policy and that, since this provided the only basis for the finding of fraud, that finding could not stand. The Supreme Court remitted the claim to the High Court "to determine what the losses were arising after the fire and what percentage of those losses were attributable to the fire; and such matters as are relevant and in issue." (per Denham J, at page 361).
Following the Supreme Court decision, Superwood brought a motion for interim payment of damages and costs, which was struck out. This application was based on the argument that, by virtue of it's ruling, the Supreme Court had allegedly recognised a clear minimum of liability of the insurers to Superwood.
A consent order was made in the High Court on 16th July 1996 providing for a two-phased structure for the hearing of the appeal. The losses attributed to the fire would be quantified first followed by an assessment of the losses arising out of the failure of the insurers to pay that money. In November 1996 the judge for the re-trial, Smyth J, ruled that it would not follow this two phased structure but proceeded to hear the case in a composite manner. He permitted the first three insurers to make lodgements, which Superwood could accept within 3 days. Superwood appealed to the Supreme Court on this matter but its appeal was rejected. It was allowed a further 3 days in which to accept the lodgements. The first 3 insurers macie a lodgement of IR£3,152,761 and it would appear that the 4th insurer made a lodgement...
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