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Recourse possibilities of insurers are limited in the Netherlands, also in case of a non-Dutch subrogation.


The Dutch Civil Code limits the possibility of insurers to subrogate in the rights of recourse of the insured against a party that is liable on grounds of strict liability (article 6:197 DCC). For example, if a warehouse burns to the ground due to a defective heating system, recourse by the property insurer against the producer of the heating system is not possible because article 6:197 DCC prohibits the subrogation. Similarly, the insurer indemnifying an insured who stored goods in this warehouse, will not be able to have recourse against the owner of the warehouse. Article 6:197 DCC provides that this limitation is applicable to a Dutch law insurance subrogation as per article 7:962 DCC. The Court of Appeal Amsterdam found in a judgment of 26 May 2015 (ECLI:NL:GHAMS:2015:2043) that the limitation in article 6:197 DCC is not limited to Dutch law subrogation but extends to insurers that subrogate under the law of another jurisdiction in a strict liability recourse right. We note that this limitation on subrogation applies to cases of strict liability (risicoaansprakelijkheid) and does not limit the possibility of subrogation based on liability in case of culpability (e.g. tort as in article 6:162 DCC).

In this particular case, a leak in a dishwasher of a restaurant had twice caused considerable damage to the inventory of the clothing store that was situated below the restaurant. The clothing store is part of an international chain and the damage was covered under an English law insurance policy. Although the insurer subrogated based on article 79 of the Marine Insurance Act 1906, the insurers recourse against the restaurant was obstructed by the Court of Appeal Amsterdam as a result of article 6:197 DCC. The Court found that article 6:197 was evidently not intended to be limited to insurers that subrogate under Dutch law. In addition the Court found that recourse was not possible because of the sectorial regulations of fire insurers in the Netherlands (Bedrijfsregeling Brandregres (BBR)). Fire (property) insurers have for decades had an agreement in the Netherlands which provides that they do not use their right of recourse against private parties (and their insurers). Until 2014, these self imposed restrictions also applied to the market of business insurances, as in this case. The insurer in this case claimed that the BBR only applied to insurance taken out with its Dutch branch office. The policy was non-Dutch but was taken out with the same legal entity as the Dutch branch office that was party to the BBR. The Court of Appeal Amsterdam rejected this argument from the insurer and found that the applicability of the BBR is not limited to insurance taken out with the Dutch branch office.


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