The London High Court has ordered Piraeus Bank to pay insurers around £3.8m ($5m) in additional costs, following an October judgment holding that shipowner Marios Iliopoulos had orchestrated a $77m tanker scuttling fraud.
Justice Nigel Teare on Wednesday ordered the Greek bank to pay the extra costs to war-risk underwriters Talbot, Hiscox, QBE, Chaucer and six others.
This was because Piraeus had chosen to pursue a "weak" case, Teare wrote in an approved judgment, following a hearing on 21 November.
The costs come in addition to the £8.7m that Piraeus Bank agreed to pay the underwriters in an interim payment of costs, which were assessed on a standard basis.
Teare ruled in October that the 150,000-dwt suezmax Brillante Virtuoso (built 1992) had been scuttled in a faked pirate attack, following a seven-year litigation that concluded with a 52-day trial earlier this year.
The case had boiled down to a legal battle among underwriters, as TradeWinds has reported.
The claimants, Piraeus Bank and its marine mortgage interest insurance (MII) providers, had already paid out for the loss of the ship.
They were attempting to recover the insured value of $77m from the defendants, a syndicate of London war-risk underwriters that ultimately won the case.
The claimants' claim rested on proving that the explosion onboard the vessel — which led to it being written off — was a genuine pirate attack and was therefore covered by war-risk insurance.
In the order filed on Wednesday, Teare said he was awarding the extra costs to the underwriters on an indemnity basis, rather than on a standard basis, because the character of the claim and its circumstances were "beyond the norm".
"The bank was entitled to resist the underwriters’ claim but in circumstances where its case was weak and the bank chose to do so at length and on every point in an uncompromising manner it cannot, it seems to me, be unjust to order that the bank pays all of the underwriters’ costs since May 2016 on the indemnity basis," Teare reasoned in his judgment.
Piraeus Bank has made no application for permission to appeal the October judgment, Teare said in Wednesday's filing.
