Anders & Kern UK Ltd (t/a Anders & Kern Presentation Systems) v CGU Insurance Plc (t/a Norwich Union Insurance)

This is an appeal from a judgment of HHJ Mackie QC in the London Mercantile Court dismissing a claim brought under an insurance policy for loss resulting from a burglary on 16 April 2004. The amount of the loss was agreed subject to liability at £195,433 net of interest.

The insured is a wholesaler of audiovisual equipment and home cinema systems. It carries on business from an office and warehouse building in Mildenhall, Suffolk. Its Managing Director is Mr Derek Kuziw. The company was formed in 1989, and by 2004 it had a turnover of £8 million, yielding a net profit of £390,000. It had, by the time of the burglary, some 25 employees.

The policy was for a period of 12 months, from 10 December 2003. It was called a retail and wholesale policy. It provided cover in respect of damage to property, theft, business interruption, employer’s liability, and public and product liability. We are concerned with the theft section of the policy.

The claim failed because the insured was found to have failed to fulfil a condition precedent to its entitlement to recover under the policy. The insuring words of the relevant part of the policy provided as follows:

“We will indemnify You in respect of Damage occurring during the Period of Insurance