Construction & Real Estate

The two authorities of National Oil Well (UK) Ltd v Davy Offshore Ltd and Woodside Petroleum Development Pty Ltd v H & RE & W Pty Ltd are conflicting in relation to the effect of a ‘waiver of subrogation’ clause in a contractors’ all risk policy of insurance.

In the National Oilwell case, the English Court considered that the waiver clause was confined to claims for losses which are insured for the benefit of the party claimed against. However, in the Woodside Petroleum case, the Full Court of the Supreme Court of Western Australia, in declining to follow National Oilwell on the point, held that there was no basis for limiting the ambit of the waiver clause to the cover provided, ie the court rejected the argument that the waiver was commensurate with cover.

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