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High Court dismisses application to strike out homeowners’ claims in fraud for abuse of process

Zurich Insurance Company Limited (Zurich) and East West Insurance Company Limited’s (EWIC) application to block the pursuit of claims relating to allegations of deceit and conspiracy fails.

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Following recent successes in Zagora Management Limited & Others v Zurich Insurance Plc & Others [2019] EWHC 140 (TCC) and Manchikalapati & Others v Zurich Insurance PLC [2019] EWCA, Walker Morris is pleased to report that a further successful judgment has been obtained from the High Court in Manchester.

Allegations of deceit and conspiracy have been made by the claimant homeowners against Zurich and EWIC in relation to the issue of alleged fraudulent insurance cover notes by Zurich’s surveyors under the Zurich Standard 10 New Home Structural Defects Insurance Policy.

Zurich and EWIC applied to strike out the claims on the somewhat surprising grounds that the Claimants could and should have litigated these claims during earlier proceedings, claiming amongst other things that the “claim must have been blindingly obvious to anyone in the position of the claimants’ legal advisors“.

The Judge found that the application failed on both grounds.

The decision marks the most recent development in claims brought by the Claimants, who are all owners of flats in a large residential development in Manchester known as New Lawrence House. The Manchester complex was marketed as an “outstanding” investment opportunity but serious safety faults were identified, which resulted in the Greater Manchester Fire & Rescue Service issuing a prohibition notice in June 2017 preventing the building from being occupied for residential purposes.

A specialist legal team including barristers instructed by Walker Morris, Thomas Grant Q.C. and Ryan Turner of Maitland Chambers, and members of the Walker Morris Construction & Engineering team, including Paul Hargreaves and Martin Scott, advised the Claimants. Paul Hargreaves who led the team, commented:

“We are incredibly pleased with the Judge’s decision and this is a further landmark in seeing both Zurich and EWIC face up to their responsibilities in relation to this development”.

If you have had a building warranty claim rejected and would like some advice on whether you are able to make a claim, please call 0800 0353276 or email Alternatively, contact Paul Hargreaves, or Martin Scott (details below).