Insurance – Ewart Charles Legg & Ors v Sterte Garage Ltd and Aviva UK Ld (CA) 23/2/16

There was ample material on which a judge could conclude that an insurer had acted exclusively or predominantly in its own interests in defending the claims brought against the insured such as to make a non-party costs order against the insurer under s. 51 (3) of the Senior Courts Act 1981. The claim as originally pleaded was in respect of a class of pollution incidents covered by the policy. The insured would have been unable to meet any award of damages if it was not covered by the policy. As such the insurer’s purpose in defending the claims as originally pleaded was not to protect the insured against an award of damages, but to seek to defeat a claim which it would otherwise be required to pay.