Log in
E-mail
Password
Show password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. Ireland
  4. Irish Stock Exchange
  5. Kingspan Group plc
  6. News
  7. Summary
    KRX   IE0004927939

KINGSPAN GROUP PLC

(KRX)
  Report
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Kingspan : A Wellington Application First Requires A Covered Loss

06/25/2021 | 06:13am EDT

June 8, 2021 - In Construction Placo inc. c. Kingspan Insulated Panels Ltd., 2021 QCCS 1230, rendered on March 18, 2021, Construction Placo inc. [Placo], as cross-defendant, sought an order from the Court requesting Société d'assurance générale Northbridge [Northbridge] to assume its defence and to pay all costs associated with its defence within the scope of the cross-claim.

In April 2016 within the scope of the construction of the aquatic complex at Havre-Saint-Pierre, Cégerco inc., as general contractor, retained the services of Placo, as subcontractor, for the installation of the exterior cladding. The subcontract awarded to Placo provided that the exterior cladding would be comprised of metallic insulated panels manufactured by Kingspan Insulated Panels Ltd. [Kingspan]. In virtue of the contract, the work had to be carried out between October 15, 2016, and December 15, 2016. According to Cégerco, Placo failed to respect its obligations and failed to follow the schedule, which caused lengthy delays. Given that Placo advised Cégerco that it was not in a position to deliver the panels before January 2017, Cégerco took temporary measures to protect the work including closing the exterior envelope of the building. In January 2017, when the panels were delivered by Placo, Cégerco maintained that the panels delivered did not meet the specified requirements and, consequently, refused them. This led to different steps being taken to try to find a solution to the problem although without success. On May 24, 2017, Cégerco proceeded to the resiliation of Placo's contract. It obtained the panels directly from Kingspan and hired a third party to finish the work.

Placo instituted legal proceedings against Kingspan to recover the deposit for the manufacturing of the panels and then against Cégerco for damages flowing from the resiliation of the contract. In its defence, Kingspan took a cross-claim for transportation costs. In October 2019, Cégerco also took a cross-claim against Placo requesting $1,783,252 corresponding to the damages allegedly sustained as a result of Placo's faulty execution, which caused numerous delays and additional costs.

Northbridge concluded that there were no covered material damages within the meaning of the liability policy, given that the allegations were essentially related to the inexecution of contractual obligations or redoing work as well as the delays resulting from same.

The Court's analysis

The Court analyzed the principles applicable to a Wellington motion and noted that, as a general rule, liability policies provide three cumulative conditions for the insured to benefit from the insurance, namely:

  • the occurrence of material or bodily injuries within the meaning of the policy;
  • the fact that material damages result from a covered loss;
  • the fact that the material damages occur within the period of coverage.

The Court noted that the insured did not benefit from coverage if the claim was solely for costs related to the poor execution of the work whereas no covered loss occurred.

The Court underlined that in order to determine whether Placo benefitted from insurance coverage, it had to assess if, during the period of the policy, the proceedings and the exhibits establish a possibility of an occurrence of material or bodily damages resulting from a loss within the meaning of the policy. In the affirmative, the Court had to address whether the exclusions apply.

To respond to these questions, the Court had to analyze the true recourse of the cross-claims. First, the cross-claim of Kingspan against Placo to recuperate an amount of $25,986.36 for transport fees could not be covered in the absence of material damages and of a covered loss.

With respect to the cross-claim of Cégerco, the Court reviewed the proceedings and noted that Placo had to provide materials and labour for the execution of the subcontract. Cégerco alleged that the exterior wall panels were finally installed one year later than provided for, and that the default and inexecution of Placo caused numerous delays and additional costs to Cégerco. The cross-claim of $1,783,252 was essentially a claim for loss of productivity for which Placo was allegedly responsible.

Were there any material damages?

The Court concluded that the damages claimed were not material damages within the meaning of the policy. There was no deterioration or destruction of a corporal property. The panels were not installed with the exception of a few and could not cause deterioration or destruction. Furthermore, given that the construction was not completed there was no loss of enjoyment which resulted; besides, only the owner of the building could invoke a loss of enjoyment. It is the delays of Placo in its execution of the contract which provoked the claim in compensation from Cégerco. Pure economic damages which flow from inadequate performance of the product of the insured are not a consequence of the loss. They result from normal and foreseeable incidents which could occur in the normal course of the activities of all enterprises.

The Court underlined that this case is distinguished from Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, 2010 SCC 33, [2010] 2 SCR 245 in that Placo did not execute the essence of its contract towards Cégerco. The panels were not installed, with the exception of a few and were not the cause of deterioration.

The Court concluded that Northbridge was under no duty to assume Placo's defence.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mariella De Stefano (Robinson Sheppard Shapiro LLP)
CLC (Canadian Litigation Counsel)
The Exchange Tower
130 King St W #2700
Toronto
ON M5X 1C7
CANADA
Tel: 416860-8392
E-mail: Hbborlack@mccagueborlack.com
URL: clcnow.com/

© Mondaq Ltd, 2021 - Tel. +44 (0)20 8544 8300 - http://www.mondaq.com, source Business Briefing

All news about KINGSPAN GROUP PLC
03:32aKINGSPAN : Williton site among first in the world to receive ISO compliance management sys..
PU
09/21KINGSPAN : IKON Innovation Centre takes the Gold for green design
PU
09/17KINGSPAN : sets sail for sustainability with sponsorship of Tom Dolan
PU
09/09KINGSPAN GROUP PLC : Ex-dividend day for interim dividend
FA
09/07ANALYST RECOMMENDATIONS : Amgen, Banner, Merck, Oracle, Phoenix...
09/02KINGSPAN : Glenamaddy becomes first site in Group to be powered by 100% renewable energy
PU
08/20FTSE 100 Rises 0.4% as Retail Gains
DJ
08/20FTSE 100 Falls as Growth Fears Persist; More Volatility Possible
DJ
08/20Kingspan Group 1st Half Boosted by High Demand, Construction-Sector Recovery
DJ
08/20Investors Hoping M&S Outlook Upgrade Signals Turning Point
DJ
More news
Analyst Recommendations on KINGSPAN GROUP PLC
More recommendations
Financials
Sales 2021 6 121 M 7 180 M 7 180 M
Net income 2021 522 M 613 M 613 M
Net Debt 2021 514 M 603 M 603 M
P/E ratio 2021 33,4x
Yield 2021 0,46%
Capitalization 17 298 M 20 270 M 20 291 M
EV / Sales 2021 2,91x
EV / Sales 2022 2,66x
Nbr of Employees 15 500
Free-Float 82,8%
Chart KINGSPAN GROUP PLC
Duration : Period :
Kingspan Group plc Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends KINGSPAN GROUP PLC
Short TermMid-TermLong Term
TrendsNeutralBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 15
Last Close Price 95,44 €
Average target price 94,81 €
Spread / Average Target -0,66%
EPS Revisions
Managers and Directors
Gene M. Murtagh Chief Executive Officer & Executive Director
Geoffrey P. Doherty Chief Financial Officer & Executive Director
Jost A. Massenberg Non-Executive Chairman
Linda Hickey Senior Independent Non-Executive Director
John Cronin Independent Non-Executive Director
Sector and Competitors
1st jan.Capi. (M$)
KINGSPAN GROUP PLC66.27%20 270
FORBO HOLDING AG25.30%3 251
TARKETT42.01%1 562
MONALISA GROUP CO.,LTD-30.15%1 430
DYNASTY CERAMIC PUBLIC COMPANY LIMITED29.73%788
PT ARWANA CITRAMULIA TBK8.82%378