Aspen Underwriting Ltd & Ors v Credit Europe Bank NV

Factual and Procedural Background

Plaintiff, a group of marine underwriters, insured a vessel (“the Vessel”) under a hull and machinery policy (“the Policy”). Defendant, a Dutch-domiciled bank, financed the Vessel and, by way of mortgage and assignment, became loss payee and beneficiary under that Policy. The Policy contained an English law and exclusive jurisdiction clause in favour of the courts of England and Wales.

After the Vessel sank in April 2013, Plaintiff settled the insurance claim with the Vessel’s owners and managers (“Company A”) and paid the proceeds to the insurance brokers in London pursuant to a letter of authority issued by Defendant. Subsequently, the Admiralty Court found that Company A had intentionally scuttled the Vessel.

Plaintiff then sued Company A and Defendant in the High Court of England and Wales seeking rescission of the settlement, damages for misrepresentation and restitution of the US$22 million already paid. Defendant contested jurisdiction. At first instance, Judge Teare partially accepted the jurisdiction challenge; the Court of Appeal affirmed. Both sides appealed to the Supreme Court, where Judge Hodge delivered the instant judgment.

Legal Issues Presented

1. Whether the High Court had jurisdiction over Defendant by virtue of the exclusive jurisdiction clause in the Policy.
2. Whether Plaintiff’s claims against Defendant were “matters relating to insurance” under Chapter II, section 3 of Regulation (EU) 1215/2012 (“the Brussels Regulation Recast”).
3. If issue 2 was answered “yes,” whether Defendant, as assignee/loss payee, was entitled to rely on the special jurisdictional protection afforded by section 3.
4. Whether the restitution claim was a “matter relating to tort, delict or quasi-delict” under Article 7(2) of the Regulation (an issue the Court ultimately found unnecessary to decide).

Arguments of the Parties

Plaintiff's Arguments

• Defendant became bound by the Policy’s exclusive jurisdiction clause when it issued the letter of authority directing payment of the insurance proceeds; asserting that right, even short of litigation, activated the clause.
• The claims were not “matters relating to insurance” because they focused on misrepresentation, mistake and unjust enrichment, not breach of any obligation in the Policy.
• Even if section 3 applied, Defendant was not a “weaker party” warranting protection; its ship-finance business rendered it commercially sophisticated.

Defendant's Arguments

• It never commenced proceedings under the Policy; therefore, under English and EU law, it did not consent to the jurisdiction clause merely by receiving payment.
• The subject-matter of Plaintiff’s action—whether there was an insured peril—squarely related to the Policy; Article 14 of the Regulation required Plaintiff to sue only in the courts of Defendant’s domicile.
• The Regulation protects all policyholders, insureds and beneficiaries, irrespective of relative bargaining power; no “weaker party” test is grafted onto Article 14.

Table of Precedents Cited

Court's Reasoning and Analysis

Issue 1 – Exclusive Jurisdiction Clause. The Court held that Defendant never became party to the Policy’s jurisdiction clause. EU authorities such as Coreck Maritime demand clear consensus, or the transferee must be a true successor to both rights and obligations, which English assignment law (see Tolhurst) denies. The “conditional benefit” doctrine (The Jay Bola) only bites when an assignee actively enforces its contractual right; mere receipt of insurance proceeds pursuant to a letter of authority created no inconsistency with the clause. Therefore, Article 25 of the Regulation was not engaged.

Issue 2 – Whether the Claims Relate to Insurance. The Court agreed with the lower courts that Plaintiff’s misrepresentation and restitution claims were so closely connected to the Policy—turning on whether there was an insured peril—that they are “matters relating to insurance” within section 3. Even applying the tighter Brogsitter test, any alleged insurance fraud necessarily breaches the Policy (see Versloot).

Issue 3 – Availability of Section 3 Protection. Recital (18) explains but does not limit Article 14. CJEU jurisprudence (Gerling; Group Josi; Hofsøe) shows that all policyholders, insureds or beneficiaries are deemed the weaker party without individualised inquiry, except where Articles 15(5) and 16 expressly carve out “large-risk” contracts. No such derogating agreement existed. As named loss-payee, Defendant is a “beneficiary” and therefore entitled to Article 14 protection. Consequently, Plaintiff may sue Defendant only in the courts of Defendant’s domicile (The Netherlands).

Issue 4 – Article 7(2). Because Article 14 applies, it is unnecessary to decide whether the restitution claim falls under Article 7(2).

Holding and Implications

Holding: INSURERS’ APPEAL DISMISSED; DEFENDANT’S APPEAL ALLOWED. The High Court of England and Wales lacks jurisdiction over Plaintiff’s claims against Defendant.

Implications: The decision confirms that beneficiaries named in a marine insurance policy are categorically protected by Article 14 of the Brussels Regulation Recast, regardless of their commercial sophistication. The immediate consequence is that any proceedings by Plaintiff must be commenced in the Dutch courts. The judgment does not establish a new rule but clarifies the strict, textual approach to insurance jurisdiction under EU law.