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Tonicstar Ltd v Allianz Insurance PLC and Sirius International Insurance Corporation

15th Nov 2017

Stephen Hofmeyr QC appeared on behalf of the respondent in an application to remove an arbitrator pursuant to section 24 of the Arbitration Act 1996.

The dispute concerned the construction of clause 15.5 of the Joint Excess Loss Committee, Excess Loss Clauses (01/1997) which provides:

“Unless the parties otherwise agree the arbitration tribunal shall consist of persons with not less than ten years’ experience of insurance or reinsurance”

The question for the Judge was whether the respondent’s appointed arbitrator should be removed on the ground that, as a lawyer, he did not possess the qualifications required by the arbitration agreement.

Teare J felt compelled to follow the unreported decision of Morison J in Company X v Company Y (2000) which required arbitrators to be individuals who had gained their experience working in the insurance or reinsurance industry and not those who had gained their experience working with or on behalf of that industry.

The Judge did not decide the issue as a matter of construction and held that “uninhibited by that decision I might well have decided that the ordinary and natural construction of the phrase in question did not limit the fields in which experience of insurance or reinsurance could be acquired and that the “context” argument was not sufficiently strong to justify implying the suggested limitation that the relevant experience be acquired in the business of insurance or reinsurance.”

The Judge found against the respondent but granted permission to appeal.

To view the judgment please click here.

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