Agapitos v. Agnew & Ors

Ioannis Agapitos (plaintiff) owned a passenger ferry. Konstantinos Agapitos (plaintiff) was Ioannis’s son. The ship was insured while it was undergoing maintenance. A January 12, 1996, policy endorsement stated that hot works on the ship’s decks would commence soon but not until a London Salvage Association (LSA) certificate was obtained. On January 25, the insurers’ brokers received a fax from the ship’s managers indicating that hot works had begun. On January 26, the brokers sent a reminder that the policy required an LSA certificate. By early February, the LSA appointed Costouros to survey the ship and issue an LSA certificate. However, Costouros did not survey the ship before it was destroyed by a February 19 fire that occurred while hot works were being performed. In January 1997, Ioannis sued Agnew & Ors (Agnew) (defendant), seeking payment under the insurance policy. Konstantinos took over the litigation upon Ioannis’s death. Agnew responded that Konstantinos was not entitled to recover because Konstantinos breached a policy warranty by performing hot works without an LSA certificate. In a litigation filing, Konstantinos denied that hot works commenced before February 12 and contended that on February 8, Costorous authorized hot works even without a survey. During litigation discovery, Konstantinos produced evidence indicating that hot works started as early as February 1. Agnew then sought to amend its defense to assert that Ioannis and Konstantinos lied about when hot works commenced and thus breached their duty to act in utmost good faith. Per Agnew, this meant that Konstantinos was barred from recovery under the policy even if his claim otherwise was meritorious.