Business

Galtee Wood Products sues insurers for up to €6.5m following fire

Company claims insurer wrongfully turned down claim over fire that destroyed premises

Galtee Wood Products and Galtee Veneer Bonding is suing Citynet Insurance Brokers and six members of the Novae/Axis Syndicate at Lloyd’s. Photograph: iStock

Mon Feb 25 2019 - 15:57

A wood products manufacturing group has claimed an insurer wrongfully turned down its claim for between €5.9 million and €6.5 million over an accidental fire that destroyed its premises last year.

Galtee Wood Products and Galtee Veneer Bonding, trading as the Galtee Group, is suing Citynet Insurance Brokers and six members of the Novae/Axis Syndicate at Lloyd's.

In the early hours of July 8th last, the company's premises at Cork Road, Ballylanders, Co Limerick, where 45 people work, was destroyed by the fire. The group manufactures wood panels and related products.

A claim for between €5.9 million and €6.5 million was lodged with the insurers including €3.9 million rebuilding costs.

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Eoin Ryan, managing director of the family-owned business, said in an affidavit that lawyers for the underwriting syndicate declined last September to meet the claim on the policy, which was fully paid up.

The reason given was there had been a breach of a condition that a survey of the property was to be carried out within 60 days of the policy coming into force.

It was also claimed there was a breach of a condition relating to the fire alarm system but this was subsequently dropped, he said.

Mr Ryan said the brokers, Citynet, had acted in error in including the property survey clause in the policy.

Citynet was never instructed to do so and it also failed to inform Galtee of this when it had done so, he said.

Notwithstanding this, the syndicate “have wrongfully and opportunistically” refused to provide cover under the policy, he said.

There was a particular urgency to having this matter expeditiously resolved, he also said.

The fire has had a dramatic negative impact on turnover and there is a danger the company will be unable to meet its €25,000 weekly wage bill, he said.

Mr Justice Robert Haughton agreed on Monday to admit the case to the fast-track Commercial Court. A hearing date will be fixed later.

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