Versloot Dredging BV v HDI Gerling Industrie Versicherung AG (The DC Merwestone)

[2016] UKSC 45

Ratio Decidendi

The fraudulent claims rule does not extend to 'collateral lies' — lies told in support of a claim that is otherwise genuine. A policyholder who tells a lie that is not material to the claim does not forfeit the entire claim.

Ffeithiau

The insured vessel suffered flooding damage. The insured made a genuine claim but included a collateral lie about when the crew discovered the damage.

Crynodeb o'r dyfarniad

The Supreme Court held that the fraudulent claims rule applies only where the fraud is material to the claim. A collateral lie — one that does not affect the insured's entitlement — does not engage the rule.

Dyfyniadau allweddol

"A collateral lie, however reprehensible, does not justify the disproportionate sanction of forfeiture."
— Lord Sumption

Triniaeth ddilynol

Leading Authority

Modified the common law fraudulent claims rule.