PROPERTY DISPUTE

SOLUTIONS

BEFORE THE EVENT

Our before-the-event indemnities address scenarios typically arising in commercial property transactions where due diligence has revealed grounds for a potential legal claim against the target company or the target property. Often related to technical interpretations of statutes or recent case law governing ownership or leases, we combine our legal know-how and insurance capacity to create an individual indemnity covering 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 within 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.
Property Litigation Buy-Out Insurance enables property owners to close off disputes, by buying protection against the risk that potential or dormant litigation is pursued.
Disposing or acquiring property, especially after a development project has been completed, can be complicated by the legacy of disputes with neighbouring land owners.
CASE CONTEXT
A developer negotiated a release of rights from a neighbouring property owner to address a potential legal nuisance. The releasing party owned a freehold interest. Uncertainty existed as to the extent that the freeholder’s rights passed to tenants within the demise of each lease.
SOLUTION
Property Litigation Buy-Out Insurance facilitated the Deed of Release by insuring the freehold neighbour in respect of any future legal claims against them by lessees.