- Estoppel by convention and interpreting unusual terms (ABN AMRO Bank NV v Royal and Sun Alliance Insurance plc)
- What are the practical implications of this case?
- What was the background?
- The first appeal—construing express terms
- The second appeal—estoppel by convention
- What did the court decide?
- The first appeal
- The second appeal
- Case details
Insurance & Reinsurance analysis: The Court of Appeal was called on to consider two related appeals in respect of contracts for marine insurance that unusually insured a bank against (among other things) lost profits where its client failed to comply with the terms of a financial product offered by the bank. The first appeal concerned the proper construction of the unusual term and whether there was sufficient in factual matrix to displace the clear and unambiguous express term which the judge found provided for insurance against lost profits, notwithstanding the unusual nature of such a term in the marine insurance industry. The second appeal was by a broker against a finding that they were liable to the bank in breach of contract and negligence by reason of failing to ensure that two of the twelve underwriters were aware of the full terms including the term insuring the Bank in respect of lost profits. The second appeal engaged consideration of the scope of the doctrine of estoppel by convention. Written by Lauren Godfrey, barrister at Gatehouse Chambers.
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