PROPERTY DISPUTE

SOLUTIONS

AFTER THE EVENT

We provide unique indemnities, typically to protect against dormant or potential Appeal Court proceedings (although first instance litigation risk can be insured). With our exposure to property-related litigation, we work behind your legal advisers to understand and combine their expertise with our claims experience. Our policies can cover defence costs, liability to costs and loss of security (for funders) upon an adverse order. We can also consider the addition of protection for consequential losses.

 
CLS’s panel of carriers enables us to insure sums of up to GBP 270 million of AA- and A rated paper. Additional capacity is drawn upon for larger cases.
See ERGO, AEGIS and AMTRUST for their current financial standing.
Our products are a hybrid of a legal indemnity and a pure contingency product. In the context of property disputes, we provide a unique approach enabling clients and their advisers to price and insure against excess financial liability flowing from their litigation strategy. We work with our client’s lawyers and our own legal team to define the insured risk (e.g. loss of title) and point in time when the litigation burden risk passes from the insured to the insurer – typically the point in time when an appeal is lodged by the insured’s opponent. Our products are favoured by developers and funders alike because we specialise in property-related disputes and allow our insureds to retain control of settlement dialogue (within defined parameters detailed in the policy) to protect brand and reputational risk.
Common heads of loss include adverse costs, appeal costs and loss in market value (upon a final order). We can also include additional cover for consequential losses (delay costs, loss of trading receipts and liability to tenants) in the event of an unsuccessful appeal.
Due to the fact-specific nature of most litigation risks we encourage clients to discuss matters and set out their risk in context. We will then engage with your professional team to ensure we appreciate the solution required before we undertake (and share) our own due diligence.
We appreciate the time-sensitive nature of most enquiries related to litigation risk and endeavour to provide an indicative view on these within 48 hours (depending on complexity). Subject to the nature and jurisdiction of the litigation risk we aim to provide an in principle response with 5 working days. However, within a large team of underwriters in London we are committed to providing ‘real time’ solutions.
Using CLS’s panel of insurers, we are able to insure in the UK & Europe. We focus on England and Wales, France, Germany and Benelux currently.
CASE CONTEXT
A prominent developer won a concession contract from a French Local Authority to build a significant mixed private and public development. The decision was the subject of an unsuccessful challenge by a competing developer in the lower Court - an appeal was threatened. Using legal opinions to evaluate the litigation risks associated with the threatened appeal we provided an insurance solution that enabled the developer to provide a contractual guarantee to private buyers in reliance on various potential liabilities owed to it from the Local Authority to their Notary's satisfaction without putting the developer's balance sheet at risk.
SOLUTION
We created an insured solution blending English legal indemnities with Civil Code practices to ensure a major housing project could proceed despite ongoing procurement litigation.
CASE CONTEXT
As a condition of planning an obligation was placed onto a developer of a large residential complex to include provisions to reduce the flood risk for the surrounding area. As a result of implementing these measures the developer may disperse excess waters onto neighbouring land. The neighbouring land owner may pursue a claim in nuisance to have the flood reduction measures removed by way of an injunction which potentially may render the planning permission void.
SOLUTION
An insurance solution was tailored here on the basis of a supporting Opinion from Legal Counsel and a pragmatic view as to the risk. The policy meant that the developer could cap their potential losses during the construction phase and equally facilitated the future sale of the houses by extending cover to the future buyers.