[2025] EWHC 2035 (Comm)

The underlying claim concerns a fire which took place on 7 February 2018 (“the Fire”) which destroyed one and severely damaged two of the industrial units (“the Units”) on premises at Hereford House, Lower Dunton Road, Dunton, Brentwood CM13 3SN (“the Property”). Mr Tregunno is the freehold owner of the Property and the sole director of Mode. At the time of the Fire, the relevant policy period was from 12 February 2017 to 11 February 2018 but this was extended until AXA confirmed it was no longer in force on 9 March 2018. Mode (the corporate entity) was the sole named policyholder on the Policy.

In the course of its investigations into the Fire, AXA says it discovered various matters which led it to conclude that there had not been a fair presentation of the risk by Mode prior to inception of the Policy including alleged misrepresentation and non-disclosure. AXA’s concerns at the time were as to: (i) Mode’s insurable interest in circumstances where the Property was in fact owned by Mr Tregunno; (ii) whether there was a planning permission in place for renovations being carried out at the Property and (iii) various county court judgments having been entered against Mr Tregunno. When asked about these matters, Mr Tregunno initially said that there was a lease in place between him and Mode (in a letter dated 18 July 2018). However, Mode’s pleaded case in paragraphs 1.1 to 1.4 of the Particulars of Claim is that it holds its interest in the Property on bare trust for the trustees (“the Trustees”) of the Buckingham Administrators Remuneration Trust (“the Trust”) in accordance with a fiduciary services agreement dated 7 July 2016 made between (1) Mode and (2) Buckingham Administrators Limited on behalf of the Trustees (“the FSA”). Although these documents were in evidence before me, it is right to record that Mr Chapman KC (who appeared on behalf of the Claimants) accepted (and I agree) that the deed of declaration and FSA were “somewhat opaque”.

By its letter dated 28 September 2018, AXA purported to avoid the Policy ab initio. Mode and Mr Tregunno challenged the decision by AXA to avoid the Policy in correspondence (in 2018/2019 and again through a different firm of solicitors in 2021/2022) and by bringing two complaints to the Financial Ombudsman Service (“FOS”) but these were rejected on 26 May 2020 and 22 August 2022 respectively. Although the Claim Form was issued on 26 September 2024, it was only on 24 January 2025 that Mode and Mr Tregunno (acting now through their current solicitors Ozon Solicitors Limited) served the Claim Form and Particulars of Claim.

Although Mode and Mr Tregunno challenge AXA’s entitlement to avoid the Policy that is not an issue which is capable of being determined in the course of this application and Counsel for AXA properly invited me to proceed on the assumption that the Claimants’ case on avoidance is correct.