Zagora Management Ltd and others v Zurich Insurance plc and other companies

Building – Defect. In a dispute concerning serious fire safety defects in a development of two blocks of flats in Manchester, the freeholder, Zagora Management Ltd (Zagora), failed in its claim against the first defendant, Zurich Insurance plc (ZIP), which had issued building warranties in respect of the development. The Technology and Construction Court held that a claimed agreement to rectify was not a legally concluded agreement and that Zagora was not, and had never been treated as if it was, an insured under a building warranty in the relevant insurance policy. The individual leaseholder claimants succeed against ZIP (or more accurately, the third defendant company) on the grounds that the building was seriously defective and required major and expensive repairs which fell within the cover afforded by the relevant building warranties. However, the claimants claim in deceit against the second defendant, Zurich Building Control Services Ltd, which had inspected and certified approval of the development, failed on the facts.

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