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Contractors’ All Risks: EWCA holds post-expiry deterioration and investigation costs recoverable; clarifies meaning of ‘damage’ and ‘any one event’ aggregation and deductibles – Sky v Riverstone [2024] EWCA Civ 1567

Published on: 07 January 2025

Published by a LexisNexis Construction expert
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Sky UK Ltd and another company v Riverstone Managing Agency Ltd and other companies [2024] EWCA Civ 1567 What are the practical implications of this case?

It is uncommon for coverage disputes under CAR policies to reach the Courts, as most are resolved through private arbitration. This ruling is especially welcome because it addresses a policy with a standard-form insurance clause, making it likely to have broad application. The standout finding relates to cover for damage emerging after the expiry of the policy.

The judgment emphasises the value of reverting to first principles when grappling with complex legal issues. The central tenet is that an insurance policy is a contract of indemnity, under which the insurer undertakes that the insured peril will not materialise. If the insured event nevertheless occurs, the insurer is in breach of contract and must pay unliquidated damages for failing to hold the insured harmless. Where the insured event is property damage within a defined period, and it occurs, the unliquidated damages payable by the insurer are to be assessed in line with ordinary contractual principles, with the aim of restoring the insured to the position it would...

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