Dispute over distribution of Creeslough insurance payout

High Court Reporters

A dispute over the distribution of insurance payouts to apartment owners in Creeslough, Co Donegal,where an explosion claimed the lives of 10 people and hospitalised eight, has been entered into the High Court's fast track commercial list.

Four men, three women and three children, ranging in age from five to 59, died in the explosion on October 7th 2022.

Aviva Insurance Ireland Ltd is suing Vivo Shell Ltd, owner of the property on which an Applegreen Service Station operated and which also owned three of the 16 apartments built on the site.

Aviva is also suing a number of the other apartment owners, who are couples and individuals, and who are claiming a share in the insurance payout for the damage.

On Monday, head of the Commercial Court Mr Justice Mark Sanfey said he was "more than satisfied" there was no culpable delay in bringing the case. It was a difficult and sensitive matter and he was quite satisfied to admit it to the commercial list because of the amount of money involved.

It followed an application by Andrew Fitzpatrick SC, for Aviva, who said none of the defendants had objected to admission of the case to the Commercial Court.

He said his client's interest was in getting the matter resolved quickly. There are 60 third parties who have also issued claims and the outcome of this case will have a consequence for them, he said. So there was an interest for everybody to have it resolved quickly, he said.

Everyone had tried to resolve it and have now agreed to go to mediation, he said.

Counsel sought an adjournment to allow for mediation to take place and if not successful, the court could then make directions as to how the case should proceed.

Mr Justice Sanfey agreed to adjourn it to the end of November, with liberty to apply to the court if it can be done sooner.

In an affidavit seeking entry of the case to the Commercial Court, Michael Corrigan, solicitor for Aviva, said in the insurance policy, taken out by Vivo Shell in August 2022, the buildings were insured for €1.7m and contents at €65,000

The amount for public liability, for any one event, was €6.5m.

While the policy makes no express reference to the apartment owners as having any entitlement under the policy, since the explosion they have asserted they are entitled to a form of equitable and/or beneficial claim and/or are entitled to be treated as insured under the policy, Mr Corrigan said.

Vivo Shell appears to acknowledge the apartment owners have an entitlement under the buildings sum insured, but there has been no agreement on how the proportions of that sum should be divided between them, he said.

The apartment owners also say they have an entitlement under contents insurance but Vivo Shell does not recognise this.

Aviva has no objection to the recognition of the right of apartment owners to a share in the buildings insurance and notes the clear difference over contents insurance.

It says it has been anxious at all times to ensure no party is unduly preferred where it says the premises has been underinsured for the losses which have occurred.

Mr Corrigan said he has engaged directly with five solicitors firms representing the apartment owners and Vivo Shell with a view to achieving agreement between them.

He said earlier this year there was a "broadly positive" reception to proposals to resolve the matter. However, it has not been possible to get acceptance from all the respondents.

He asked that the case be admitted to the Commercial Court so it can be determined as quickly as possible.