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Enterprise Oil Ltd v Strand Insurance Co Ltd

Language: English Publication details: 2006Subject(s): Online resources: Summary: [2006] EWHC 58 (Comm) 26 January 2006. E, together with X, had agreed to explore and develop certain North Sea oil fields. E supported X when the latter rejected a drilling unit constructed by R on the grounds that delivery of the unit was both late and defective. R commenced proceedings in Texas, alleging that E had committed a number of torts under Texan law. Following a mock trial, E paid an agreed sum in settlement to R. E argued that it would or might have been liable to R in tort, and claimed an indemnity from S, a captive insurance company, on the basis that it had incurred liability as defined in the policy placed with S. "Held" Upon a proper construction of the policy, E was covered for actual liability to third parties but not for arguable liability. Therefore, E was not entitled to the indemnity sought.

[2006] EWHC 58 (Comm) 26 January 2006. E, together with X, had agreed to explore and develop certain North Sea oil fields. E supported X when the latter rejected a drilling unit constructed by R on the grounds that delivery of the unit was both late and defective. R commenced proceedings in Texas, alleging that E had committed a number of torts under Texan law. Following a mock trial, E paid an agreed sum in settlement to R. E argued that it would or might have been liable to R in tort, and claimed an indemnity from S, a captive insurance company, on the basis that it had incurred liability as defined in the policy placed with S. "Held" Upon a proper construction of the policy, E was covered for actual liability to third parties but not for arguable liability. Therefore, E was not entitled to the indemnity sought.

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