{"id":9297,"date":"2026-02-16T17:31:36","date_gmt":"2026-02-16T17:31:36","guid":{"rendered":"https:\/\/www.europesays.com\/ch\/9297\/"},"modified":"2026-02-16T17:31:36","modified_gmt":"2026-02-16T17:31:36","slug":"insurer-zurich-insurance-plc-ordered-to-pay-indemnity-costs-to-devonshires-clients-due-to-extraordinary-behaviour","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ch\/9297\/","title":{"rendered":"Insurer, Zurich Insurance Plc ordered to pay Indemnity Costs to Devonshires clients due to \u201cextraordinary behaviour\u201d"},"content":{"rendered":"

In the judgment<\/a> handed down 24 June 2025, Bellhouse & Anor v Zurich Insurance\u00a0PLC [2025] EWHC 1551 (\u201cBellhouse 2\u201d), which primarily addressed consequential cost issues, the High Court made clear that an insurer will be at risk of paying costs on an indemnity- effectively full reimbursement – basis\u00a0 because of its conduct, and where that insurer should have known and acted better.\u00a0<\/p>\n

This judgment followed an earlier judgment<\/a> handed down on 18 June 2025, Bellhouse & Anor v Zurich Insurance Plc [2025] EWHC 1416 (Comm) (\u201cBellhouse 1\u201d), where the Claimants, Mr and Mrs Bellhouse, represented by Devonshires, made an application for summary judgment and alternatively strike out of two of Zurich\u2019s main defences to the Claimants\u2019 insurance claim following a major fire destroying their home on 29 December 2022 (reported in the Standard, here<\/a>).\u00a0<\/p>\n

Mr and Mrs Bellhouse were insured by the Zurich Private Clients division of Zurich Insurance Plc. Despite extensive pre action correspondence, Zurich refused to agree to pay their claim and eventually, in March 2024, the Claimants sued Zurich. \u00a0Zurich in its defence claimed that in their application for insurance Mr and Mrs Bellhouse had wrongly stated that they did not intend to carry out contract works in the next 12 months (misrepresentation defence). Material to the applications before the Court, Zurich also argued that they could rely on an exclusion in the policy, which excluded damage caused by contract works (contract work exclusion).\u00a0<\/p>\n

Mr and Mrs Bellhouse made an application for summary judgment against Zurich, and alternatively the strike out of Zurich\u2019s defences on these issues, because of claimed clear deficiencies in Zurich\u2019s pleaded case.\u00a0<\/p>\n

In Bellhouse 1, the High Court agreed there were clear deficiencies in the pleading. The Judge, HHJ Hodge KC described Zurich\u2019s statements of case among other criticisms as \u201cturgid\u201d and \u201coverly long, rambling, and digressive\u2026full of irrelevancies, and matters of background facts and evidence\u2026they are not concise, nor do they confine themselves only to the material facts\u201d.<\/p>\n

In respect of the misrepresentation defence asserted by Zurich, the Judge said\u00a0that \u201cit is impossible to distil from Zurich\u2019s pleadings precisely how the qualifying misrepresentation was communicated to Zurich, or (if and when it was) exactly how, and in what way, anyone, and if so who, at Zurich relied upon it. An unkind, or cynical, reader of Zurich\u2019s statements of case might be tempted to conclude that their very complexity and length were intended to conceal the lack of essential substance at their very heart.\u201d\u00a0<\/p>\n

With respect to the contract works exclusion defence, the Judge held that the pleading in its current state was \u201cinsufficiently particularised to raise a triable issue with any real prospect of success.\u201d<\/p>\n

The Judge\u2019s disposal of the application was to order a strike out of part of the contract works exclusion defence. \u00a0The Judge also gave Zurich the opportunity to remedy clear deficiencies in its pleading. \u00a0Zurich had never previously recognised that this was necessary, despite repeated requests by Mr and Mrs Bellhouse.\u00a0<\/p>\n

The Judge held that Zurich was the unsuccessful party to the application. Despite the Judge’s provisional view on costs, which was that they \u201cshould be borne, at least in large part, by Zurich\u201d, Zurich contested costs. \u00a0In Bellhouse 2, the Judge principally addressed the resolution of that issue.\u00a0<\/p>\n

The Judge ordered Zurich to pay in principle Mr and Mrs Bellhouse\u2019s costs of the application, expressing surprise that Zurich should consider it was the successful party.\u00a0<\/p>\n

The Judge also ordered those costs be assessed not on the usual standard basis but rather on a (full) indemnity basis and did so because of his expressed view of \u201cZurich\u2019s extraordinary behaviour\u201d.\u00a0<\/p>\n

This had necessitated the application by Mr and Mrs Bellhouse, taking this case outside the \u2018norm\u2019 for consumer insurance disputes of the present kind. Indeed, it had \u201cnecessitated a vast, and wholly unnecessary, expenditure of costs by private individuals, who have suffered substantial damage to their home\u2026\u201d.\u00a0 It had \u201c put the timetable for this case back by almost a full year\u201d and had \u201cdiverted the parties\u2019 focus away from the true issues in the case\u201d<\/p>\n

Finally, the Judge emphasised also that this had also involved \u201can unnecessary drain upon the court\u2019s scarce resources as a result of conduct by a well-represented insurer which should have known, and acted, better.\u201d<\/p>\n

As can be seen from these judgments, the Courts will not shy away from basing cost orders on parties\u2019 conduct. This case as noted was a claim by a consumer, a husband and wife, against their household insurer, and whilst the Court is- and in this case was- prepared to make case management decisions that allow a defendant (even Zurich as a well-represented insurer) to correct pleading deficiencies, such a defendant must expect to bear and pay other parties costs of doing so and particularly where it has otherwise resisted doing so.\u00a0<\/p>\n

Devonshires Partner Stephen Netherway<\/a>, and Senior Associate Grace Williams<\/a>, with Counsel Mek Mesfin<\/a> of 4 Pump Court, acted for the successful applicants Mr and Mrs Bellhouse.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"In the judgment handed down 24 June 2025, Bellhouse & Anor v Zurich Insurance\u00a0PLC [2025] EWHC 1551 (\u201cBellhouse…\n","protected":false},"author":2,"featured_media":9298,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[128],"tags":[7288,7289,244,7290,7287,7286,7284,7285,219],"class_list":["post-9297","post","type-post","status-publish","format-standard","has-post-thumbnail","category-zurich-insurance","tag-costs","tag-indemnity-costs","tag-insurance","tag-litigation-dispute-resolution","tag-misrepresentation","tag-private-clients","tag-strike-out","tag-summary-judgment","tag-zurich-insurance"],"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/9297","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=9297"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/9297\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/9298"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=9297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=9297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=9297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}