Bellhouse v Zurich: High Court Orders Indemnity Costs Against Insurer Following Procedural Judgment

1. In a consequential judgment in Bellhouse & Anor v Zurich Insurance Plc [2025] EWHC 1551 (Comm), the High Court has ordered Zurich Insurance Plc to pay the claimants’ costs on the indemnity basis, following what the judge described as the insurer’s “extraordinary behaviour” which necessitated the claimants making an application to strike out and summarily dismiss key parts of its defence.
2. This judgment followed an earlier ruling ([2025] EWHC 1416 (Comm)) handed down on 18 June 2025, in which the Court declined to strike out Zurich’s misrepresentation and contract works exclusion defences outright, but only on strict conditions: Zurich was ordered to serve substantially improved particulars addressing critical omissions in its case. These included a failure to explain how the alleged misrepresentation was made or relied upon, and a lack of any pleaded factual basis for applying the contract works exclusion.
3. Handing down his ruling on consequential matters, HHJ Hodge KC (Sitting as a Judge of the High Court) found that the claimants were the successful party, even though they did not secure immediate strike out or summary judgment.
4. The judge was particularly critical of Zurich’s longstanding refusal to rectify deficiencies in its pleadings, describing Zurich’s conduct as falling “outside the ‘norm’ for consumer insurance disputes of the present kind” (paragraph [25]). He found that Zurich’s “extraordinary behaviour” had necessitated the application, caused almost a year’s delay, and diverted the parties from the true issues in the case. It had also imposed what he described as a “vast, and wholly unnecessary, expenditure of costs” on private individuals who had suffered substantial damage to their home and were simply seeking indemnity under their policy. The judge was equally critical of the strain placed on its own limited resources by Zurich’s approach, noting that this was the conduct of a “well-represented insurer which should have known, and acted, better.” Despite repeated and reasonable procedural efforts by the claimants, Zurich had refused to provide basic particulars essential to understanding its pleaded defences
5. The Court dismissed Zurich’s argument that it had “won” the application, stating that the only reason Zurich’s defences were not struck out was because the Court had granted it an indulgence to attempt to plead a viable case, something it had failed to do over many months.
6. Accordingly, the Court ordered Zurich to pay virtually all the claimants’ costs of the application on the indemnity basis, as well as the costs of, occasioned and wasted by the forthcoming further particulars, and an earlier application concerning the extension of time for Zurich’s evidence.

Mek Mesfin acted for the Claimants (instructed by Stephen Netherway and Grace Williams of Devonshires Solicitors LLP).

For a full copy of the judgment, please see here.

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Mek Mesfin

Call 2014