Signed, Sealed, Superseded? Court considers conflicting dispute resolution provisions in reinsurance contracts

In this article we explore two recent decisions where the Court had to consider which dispute resolution provisions prevailed in circumstances where the parties had agreed a reinsurance policy on the Market Reform Contract (MRC) and then subsequently issued a further document covering the same subject matter but on a different form – the Market Uniform Reinsurance Agreement (MURA).  The MRC provided for disputes to be resolved by English law and the exclusive jurisdiction of the English courts and the MURA contained a New York law and arbitration clause.

The Court came to different conclusions in each case based on slightly different fact patterns. These decisions provide an important reminder to the insurance market to be cautious when issuing and executing market standard contracts.

BACKGROUND

Both cases concerned the same captive insurer, Tyson International Company Limited (Tyson), who insured the property portfolio of a US-based company, Tyson Foods.  Tyson reinsured the property risks on a facultative basis with various reinsurers.  

The two decisions relate to claims brought by Tyson against different participating reinsurers (Partner Re and GIC Re) but the claims were the same in the following respects:

• The relevant participating reinsurer issued signed reinsurance policy documents on the MRC for the 2021/22 policy year. The MRC provided for English law and exclusive jurisdiction of the English courts.
• Subsequently, a "Facultative Certificate" was issued in respect of the same subject matter. The Facultative Certificate was on the MURA form, a common form of agreement used in the United States insurance market. The MURA provided for disputes to be resolved by arbitration in New York applying New York law.
• A dispute then arose between Tyson and the relevant reinsurer under the 2021/22 policy. Tyson issued proceedings in the Commercial Court (pursuant to the MRC) and the relevant reinsurer commenced arbitration in New York (pursuant to the MURA).
• The relevant reinsurer applied for a stay of the English proceedings pursuant to section 9 of the Arbitration Act 1996 and Tyson applied for an anti-suit injunction in respect of the New York arbitration. 

The decisions of the English Court in relation to those applications are what is discussed here.

DECISIONS

Tyson v Partner Reinsurance Europe SE [2024] EWCA Civ 363 (the "Partner Re case")

The Court of Appeal decision in this case turned largely on a key difference between the placement of the reinsurance arrangements in 2021 (to which the dispute related) and the prior year (2020).

In 2020, when the MURA facultative certificate was signed and stamped by Partner Re, Partner Re also signed and stamped an endorsement to the MRC which stated that the MURA was agreed subject to the terms and conditions of the MRC. In contrast, in 2021, neither the MURA nor the MRC contained any endorsement providing that the MURA was subject to the MRC.

Lord Justice Males, with whom Lord Justice Lewis and Lady Justice Asplin agreed, held that the 2021 MRC was superseded by the 2021 MURA, either expressly or by necessary implication. As the MURA provided for New York arbitration, it was right to stay the English proceedings pursuant to section 9 of the Arbitration Act 1996.  Accordingly, no anti-suit injunction was required or granted.

The reasoning of the Court of Appeal was as follows:

• Tyson and Partner Re were assumed to be familiar with the nature and terms of the MURA. They must have known it was an inappropriate and misleading form to use if they intended their relationship to be governed by the MRC subject to English law and jurisdiction;
• The broker and Partner Re used the language of contract formation when the broker sent the MURA to Partner Re "for agreement" and requested Partner Re to consider it "and agree as soon as possible". The MURA was not merely part of some administrative and non-contractual process;
• Partner Re agreed the terms of the MURA when it signed and stamped every page and returned it to the broker and accepted that it was a contract of reinsurance for the 2021 policy year;
• The MURA contained an entire agreement clause which expressly stated that the MURA constituted the entire agreement between Tyson and Partner Re and superseded all previous agreements, which must include the MRC;
• There was no endorsement for the 2021 policy year providing that the MURA was subject to the MRC. There were also deliberate changes to the MURA for the 2021 policy year, as compared to the 2020 policy year, which suggested the MURA had a different contractual status and that any dispute would be determined in New York;
• If the intention was for Tyson and Partner Re's relationship to be governed by English law and exclusive jurisdiction, it was contrary to business common sense for the broker to request Partner Re to agree to the terms of the MURA providing for New York law and arbitration;
• The MURA was not merely a certificate providing a summary of cover provided by the MRC, as the terms of the MURA contract were different to the MRC.

It is worth noting the obiter comments of the Court of Appeal relating to Tyson's delay in applying for an anti-suit injunction in respect of the New York arbitration. The first instance judge had said that, even if the MRC was not superseded by the MURA and the MRC was operative (and the English Courts had jurisdiction), he nevertheless would have refused Tyson's application for an anti-suit injunction. This was due to Tyson's delay in making that application whilst the New York arbitration was constituted and progressing. The first instance judge said that Tyson should have done this promptly after the arbitration had been commenced in New York rather than waiting almost 6 months. However, the Court of Appeal did not agree with these comments. It recognised that if the English court did not restrain the New York arbitration, both the arbitration and the English proceedings would proceed resulting in the duplication of trouble and expense, a race to judgment and a real risk of conflicting decisions of dubious enforceability. The Court of Appeal concluded that Tyson's delay (which it noted was only of a few months and during which time the arbitration remained at an early stage) was substantially outweighed by the unacceptable consequences of allowing both the English proceedings and New York arbitration to proceed.

Tyson v GIC Re, India, Corporate Member Ltd [2025] EWHC 77 (Comm) (the "GIC Re case")

This decision follows on from that of the High Court in February 2024 which held that an interim anti-suit injunction which had been granted in this case should continue until the determination of GIC Re's jurisdiction challenge (see our Litigation Blog post on this decision). This decision discussed below is the determination of the jurisdiction challenge.

The judge in this case considered himself bound by the Court of Appeal judgment in the Partner Re case and agreed with the analysis that the MURA was a contractual document which was intended to supersede the MRC. 

However, there was a distinguishing feature in this case which was that the MURA included a 'Confusion Clause' which provided:

            "RI slip to take precedence over reinsurance certificate in case of confusion."

It was common ground between the parties that reference to "RI slip" was a reference to the MRC and that reference to the “reinsurance certificate” was to the MURA.

The Court held that the intention of the Confusion Clause was that the terms of the MRC would prevail if there was confusion between the terms of the MRC and the terms of the MURA. The Court also found that there was confusion in this case given that the English jurisdiction clause in the MRC and the New York arbitration agreement in the MURA inevitably conflict. 

The Court held that the dispute resolution provisions in the MRC prevailed and, therefore, agreed that GIC Re's application for a stay of the English proceedings should fail and Tyson's application for an anti-suit injunction of the New York arbitration should succeed. 

COMMENT

The case is a salient reminder to the insurance market to be cautious when issuing and executing market standard contracts.  Dispute resolution provisions, in particular, are often not given the attention they deserve at the point of placement but any conflict or uncertainty can give rise to costly jurisdiction disputes.