Commercial Disputes Weekly – Issue 26211 November 2025

Marine – Insurance
The Court of Appeal has provided key guidance on the operation of “pay first” clauses, in the context of the Third Parties (Rights against Insurers) Act 2010 (“2010 Act”) and Lord Denning’s “onerous clause doctrine”. The dispute concerned a charterer’s liability policy which contained a clause requiring that the assured pay any liability first before the insurer would reimburse that expense (the pay first clause). The charterer was insolvent and the vessel owner was seeking to enforce an arbitration award for the grounding of the ship against the charterer’s insurer pursuant to the 2010 Act. The 2010 Act provides that such clauses do not apply, except in the case of marine insurance (that does not relate to death or personal injury). The insurer rejected the claim because the charterer had not first paid the liability and the pay first clause applied. The Court of Appeal rejected arguments that the pay first clause was not incorporated because it was an onerous clause that had not been sufficiently drawn to charterer’s attention. The court said that such clauses were common in marine insurance and the charterer was advised by a professional broker who should have drawn charterer’s attention to the clause. Further, there was no inconsistency between the insuring clause of the policy and the pay first clause. The latter qualifies and supplements the former, rather than negating it. The two clauses can fairly be read together.

MS Amlin Marine NV v King Trader Ltd [2025] EWCA Civ 1387, 5 November 2025

Contribution
The claimant was found liable to compensate a former employee for exposure to asbestos that led to him developing mesothelioma. The exposure occurred whilst he was working as a stevedore in Port of London Authority (“PLA”) vessels, wharves and warehouses. It was alleged that the defendant, PLA, was occupier of those premises for the purposes of the Occupiers Liability Act 1957. The claimant sought contribution under the Civil Liability (Contribution) Act 1978 from the PLA to the compensation paid to its former employee. The PLA defended the claim with a clause in an agreement by which the claimant transferred its business to the PLA. The court rejected that argument on the basis that it referred only to liabilities that the claimant would bear and those from which the PLA had agreed to release it. The clause did not mean that the claimant was releasing the PLA from its liability to contribute under the 1978 Act. That was a valuable right for the claimant and there were no clear words releasing the PLA from the obligation.

T Wallis Smith Coggins Ltd v Port of London Authority [2025] EWHC 2703 (KB), 31 October 2025

Misrepresentation
In a dispute arising from investment in a technology start-up company Aaqua, the claimant has successfully established that it was induced to enter into the agreements by misrepresentations from Mr Bonnier, the directing mind of Aaqua. The misrepresentations related to other key investors and how far advanced those discussions were. The court held that the representations were false and that Mr Bonnier knew them to be false. They were made with the intention of inducing the claimant to enter into the agreements and they did in fact induce them in this way. The claimant was awarded damages of approx. £4.6m.

Candy Ventures Sarl v Aaqua BV and another [2025] EWHC 2877 (Comm), 5 November 2025

Injunctions
In a previous judgment, Lakatamia had been unsuccessful in claiming damages as the result of funds being dissipated that were subject to a worldwide freezing order. In this appeal, Lakatamia was successful. The defendant Mr Su, together with a director of one of Mr Su’s companies and a lawyer were all found guilty of unlawful means conspiracy. The court identified a number of reasons which indicated that the director was aware that the proceeds were subject to the freezing order when he ordered the funds transfer, including that he swore an affidavit of assets on behalf of another company subject to the freezing order and that he was a longstanding employee of Mr Su, managing many of his companies. If the director did not know, it was because he deliberately turned a blind eye. The Court of Appeal also held that the lower court judge had been wrong to hold that the lawyer had a defence by virtue of being outside the court’s jurisdiction.

Lakatamia Shipping Co Ltd v Su [2025] EWCA Civ 1389, 5 November 2025