CA 26 June 1987. An appeal on the wording on a professional indemnity policy. A partner in Cooke and Arkwright, (C&A), became a partner in the Merak partnership, along with other professionals, to provide clients with a combined service covering the expertise of the professionals. It was also intended that Merak would employ the respective professional firms as subcontractors when required. In 1981, Merak was engaged by Co-operative Retail Services Ltd , (CRS), to design and supervise construction of a superstore. In 1982, the store was damaged by fire ; in October 1984 CRS informed Merak that it was holding them responsible for the damage. CRS issued proceedings against Merak and other defendants alleging breach of contract or negligence in respect of defective design or inadequate inspection, supervision or advice. Merak joined C&A as third parties, alleging the work had been subcontracted to C&A. At issue in proceedings brought by C&A against their insurance underwriter, was wheth