REFORMING INSURANCE LAW: - Law Commission

also include an address and telephone number where the insurers may be contacted. There are
also consequential amendments to s 77 which allows the sending of notices to electronic
addresses but in a form which allows the recipient to keep a copy of the notice so that he has
ready access to it in the future.
Other matters governed by the 1984 Act
8.26 There are a number of other aspects of the Australian legislation which are apparently not
under consideration in the UK. Some of these are quite useful and innovative, while others are
probably redundant in the modern market. They are nevertheless worthy of brief mention.
Choice of law and jurisdiction
8.27 The United Kingdom is bound by international conventions and EU rules in matters of
jurisdiction and choice of law. Jurisdictional rules are governed by EU Council Regulation
44/2001 if the defendant is domiciled within the EU, 484 and by common law principles as
enshrined in CPR Parts 6.19 and 6.20. Choice of law is governed by the Rome Convention
1980 485 if the risk is situated outside the EU, and by European rules if the risk is situated inside
the EU. 486 These frequently unsatisfactory 487 principles have generated more insurance and
reinsurance litigation than any other topic in the past two decades. Sections 8 and 52 of the
Insurance Contracts Act 1984, as construed in Akai Pty Ltd v People’s Insurance Co Ltd 488
override both choice of law and exclusive jurisdiction clauses in favour of the law and
jurisdiction of any other place. 489 It is open to the United Kingdom under EU rules to modify
choice of law rules for risks situated in the United Kingdom, so as to prevent choice of law of
any other jurisdiction or at least to require any choice of law to be subject to the mandatory
484
There are specific rules for insurance, whereas reinsurance falls within the general jurisdiction rules.
485
Implemented into English law by the Contracts (Applicable Law) Act 1991),
486
Financial Services and Markets Act 2000 (Law Applicable to Insurance Contracts) Regulations 2001, SI 2001 No
2635.
487
The choice of law rules are predicated on the notion that a policy covers a single policyholder for a single risk,
and is issued by a single insurer. As this is rarely the case in commercial insurance, the choice of law rules are often
all but impossible to apply. For the most recent illustration, see Travelers Casualty and Surety Co of Canada v Sun
Life Assurance Co of Canada (UK) Ltd [2006] EWHC 2716 (Comm).
488
(1996) 188 CLR 418. But see the English sequel, Akai Pty Ltd v People’s Insurance Co Ltd [1998] 1 Lloyd’s
Rep 90, in which the High Court thought it appropriate to grant an anti-suit injunction to prevent the claimant in the
Australian proceedings from continuing his action even though the Australian courts had asserted jurisdiction.
489
Treasury Review II, 2005, recommendation 1.6, recommended that it should be made clear, to remove any
doubts, that policies issued by direct offshore foreign insurers to Australian policyholders or in respect of risks
situated in Australia should be subject to the 1984 Act. This recommended has been adopted by the draft Insurance
Contracts Amendment Bill 2007, which adds a new provision, s 8(1A) to the effect that the 1984 Act applies if
either the contract is entered into by a person domiciled in a State or Territory to which the Act applies or has been
extended, or if the policy provides cover against the risk of loss or damage occurring in a State, or in a Territory in
which the Act applies or has been extended. This is the case irrespective of the chosen proper law.
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