[2017] EWHC 246 (QB)

Harry Wright acted for the successful Defendant, a solicitor sued by her former law firm for alleged breaches of duty arising in the context of a mortgage transaction in which the borrowers turned out to be fraudsters. The Claimant suffered loss in settling with the mortgage lender, and having been indemnified by its professional liability insurer, attempted to bring a subrogated claim against the Defendant. The Defendant argued that under a waiver of subrogation clause in the Claimant’s professional liability policy, under which the Defendant was a co-insured, there was a waiver of subrogation against the Defendant save where her dishonesty caused the insured loss. The same result arose from an implied term in the Defendant’s consultancy agreement with the Claimant, under the principles discussed in Gard Marine & Energy Ltd v China National Chartering Co Ltd (‘The Ocean Victory’) [2015] 1 Lloyd’s Rep 295 and Cooperative Retail Services Ltd v Taylor Young Partnership Ltd [2002] Lloyd’s Rep IR 555. These arguments were successful, and the Claimant could not prove the necessary dishonesty. The claim therefore failed.

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