CH-2025-000032 - [2025] EWHC 2988 (Ch)

As I understand it the claim primarily focusses on alleged breaches of duty by Prudential during three time periods. The first relates to the taking out of the Policy by Mr Dewji in 2000. The second relates to a period when the parties agreed to submit a dispute (largely based on Mr Dewji’s same dissatisfaction about the level of premia and the value of the Policy that I have referred to as underlying the current claim) to the relevant ombudsman in the Republic of Ireland and the course of that process leading to a determination by the ombudsman in April 2013. The third relates to a period in about 2021 when it is asserted that Prudential wrongly and in breach of contract applied a travel loading to the Policy with retrospective effect.

By application form dated 12 June 2000 (the “Application Form”), Mr Dewji made an application to Prudential in respect of The Flexible Life Plan and the Flexible Critical Illness Plan. This contained Sections A to I. Section I was a declaration signed by Mr Dewji of which one of the component parts was confirmation that he had “read the sales brochure and understood the nature of the contract”. There is no evidence gainsaying Ms Cumming’s evidence that, at the time, the process was that Mr Dewji would have been provided with a copy of the Plan Brochure and Key Features Document that I shall come onto via his financial adviser and that there is no reason to think that that process was not followed in this case.

Under Section D of the Application Form, life cover and critical illness cover were applied for in the sums of £1 million and £250,000 respectively. The cover type identified was “Standard Cover Basis”.

Under Section E of the application form waiver of premium was applied for but the box was also ticked to confirm that if Prudential was unable to offer waiver of premium, the applicant wished the plan to be issued without receiving confirmation of this restriction to the proposed cover.

Under Section G of the Application Form it was confirmed that Mr Dewji lived or travelled outside the UK, apart from holiday visits. The Form asked, “If yes, please confirm full details regarding your travel….”

In evidence, described as being part of the Application Form but clearly being part of some other form, even if submitted with the Application Form, is page 6 of a document to be filled in by an independent financial adviser dealing with whether the policy is to be written or placed into trust and confirming certain money laundering checks had been undertaken. Mr Dewji’s financial adviser is identified as being Friendship Financial Services at an address in Hayes Middlesex, the form being signed on its behalf by Mr Najmudean F Bhaiji (the “IFA”). He apparently completed the request that the Policy Schedule(s) should be “issued to the IFA”.

A pre-sales illustration issued on 22 June 2000 shows (among other things) an initial annual premium of £4,522.86 for the cover that I have referred to. The cover type is described as “standard”. Waiver of premium is included but the initial premium excluding waiver of premium is given as £4,267.83. Premia are said to be reviewable after 10 years and every 5 years thereafter. The illustration also contains the following wording:

The Application Form contained considerable detail on Mr Dewji’s medical history. He also had a medical examination which ended in a record signed and dated by him on 18 July 2022 setting out his answers to various further medical questions. Part two of the form contained the relevant doctor’s answers to certain questions, including data following from readings taken.

By letter dated 27 July 2000 addressed to Prudential, Mr Dewji referred to his application and another one made by his wife and said that he understood that Prudential wished to confirm details of travels. He confirmed travel “for business purposes” to India “(Mostly Bombay or big cities)”, Kenya (“(Mombasa and Nairobi)”, Tanzania “(Dar-es-Salaam) and “Far East (Hong Kong and Singapore)”. “Maximum stay in one place is two weeks”. He also referred to making an annual pilgrimage to Mecca: “maximum stay is 10 days”. In addition he enclosed a cheque in respect of the two policies and identified the investment funds that he and his wife wished to invest in. The letter is signed both by Mr Dewji and his wife, Mrs Siddika M Merali. This letter (and the cheque) was apparently sent to Prudential under cover of a fax from Mr Bhaiji of Friendship Financial Services dated 27 July 2000 which referred to the “Travel pursuits declaration of Mr Dewji” and asked for the policies to be issued as soon as possible.

Underwriting notes have been disclosed and are in evidence. These contain the following (among other matters):

“travel details rec,d, 31 /07 never referred to u/w

India [bombay& big cities]

Far east [hk & Singapore]

Kenya(mobassa &. nairobi]

Tanzania [dar-es-salam]

max stay in 1 place is 2 wks

pjlgrimage to mecca every yr max stay is 10 days

?frequency of these trips

rang brk & he confirmed that freq of these trips is 3 times per

year to each

country

…

-spoke to stuart at swiss who recommended thatnoting

degreeof travel here

that is nearly 6 mth per year .. therefore suggested 2 per mille

rating…..

……

suggest medically std, 2 per mille for travel, therefore decline

wop&await”

At this point the underwriters were suggesting that waiver of premium cover should be refused and that there should be loading of “2 per mille” (which the evidence shows to be £2 per £1,000 (of cover)) for travel (but nothing for medical condition).

By letter dated 14 August 2000 sent by Prudential to Mr Dewji, Prudential indicated that they could not proceed on the basis proposed in the application form and said that to issue the plan they would need to apply the special terms attached. They asked Mr Dewji to sign and return those terms if he wished to proceed. Mr Dewji duly did so. The document headed “Special Terms” which was attached to the letter, and which Mr Dewji signed and returned, set out various details of the policy to be taken out by Mr Dewji including the plan type, the plan number (S6344145H) and the Life Cover Sum Assured (£1 million) and the Critical Illness Cover Sum Assured (£250,000), both payable on a single life basis. A Revised Premium was stated of £4,883.40 UK Sterling (Annually). The document went on to state that “The Waiver of Premium Benefit will not be available for Mohammed Merali Dewji under the Plan”. The document went on to contain a declaration by Mr Dewji that he wished to proceed with the plan on the basis of the Special Terms listed above and confirming no relevant change in health, occupation or material facts since the date of his application. The document is signed by Mr Dewji and dated 16 August 2000.

It is notable that although the removal of waiver of premium cover from the offer should, all things being equal, have reduced the level of premium (as the earlier illustration confirmed), the premium now being sought was in fact higher than that originally quoted for. This in fact related to the loading, although that was not said in terms.

10 Policy Schedules, each dated 23 August 2000 were issued by Prudential with numbers S6344145H-01 to S6344145H-10. At the end of each Schedule there is a box for “Related Policy Documents”. They are listed as being “Policy Conditions Reference SAE/FC1/005” and “Special Provisions S6355145H”.

In evidence is a booklet described as being “Flexible Critical Illness Plan Conditions Booklet (SAE/FCI/005) (“Policy Conditions Booklet”). There is also a document headed “Special Provisions, Special Provisions Reference S63344145H”. Each document, with the Schedules, was on the face of it sent to Mr Bhaiji. There is a document dated 23 August 2000 headed “Memorandum”. It is from Prudential and addressed to Friendship Financial Services, with “N Bhaiji” listed under “Your reference”. The Memorandum says (among other things):

“We are pleased to attach Plan documentation as outlined below:

Copy Key Features Document

Issue Letter

Policy Schedule(s) and Policy Conditions

Special Provisions”

It has been asserted in correspondence that the Special Provisions document was not received but this has not been confirmed by way of witness statement.

As points were taken on certain of the terms and conditions, I should refer to the following provisions of the Policy Conditions Booklet.

“Part 1: Introduction” contains the following (among other provisions):

“I. Flexible Critical Illness Plan - General Description

A Flexible Critical Illness Pinn is a regular premium unit-linked life assurance contract. The Plan is designed primarily to provide cover against critical! illness but it can also provide life cover and long term care cover.

The regular premiums you pay into the Plan are used to allocate investment fund units to the Plan. The value of the units varies according to the performance of the chosen investment funds. The encashment value of the Plan depends on the value of the units in the Plan and other factors such as how long the units have been in the Plan.

Our charges, such as regular charges for the protection cover the Plan is providing, are met by removing units from the Plan.

We issue a Flexible Critical Illness Plan as a group of 10 whole life policies, all linked to the same investment funds, with the premium payments, units and protection cover divided evenly across all the policies so that all the policies are identical. If we are specifically asked to issue the Plan as just one policy we will do so.