Jurisdiction clause in insurance policy confers exclusive jurisdiction despite no express words to that effect

The High Court has interpreted a jurisdiction clause in an excess liability insurance policy as granting exclusive jurisdiction to the English courts, despite the clause not containing express words to that effect: AIG Europe SA (formerly AIG Europe Ltd) v John Wood Group Plc [2021] EWHC 2567 (Comm).

While normal principles of contractual interpretation will apply, the decision suggests that an English court is likely to find that a jurisdiction clause is exclusive unless it is explicitly stated to be non-exclusive, particularly if there is also a choice of English law. It also follows in the footsteps of a number of earlier decisions which have interpreted jurisdiction clauses as being exclusive, even though the word “exclusive” was not used (see our blog post here and more recently the decision in Axis Corporate Capital UK II Ltd v ABSA Group Limited [2021] EWHC 861 (Comm)).

The decision is a reminder that the absence of the word “exclusive” is not determinative when interpreting a jurisdiction clause and that clear words should be used when drafting a jurisdiction clause (whether the intention is for the clause to be exclusive or non-exclusive) in order to avoid uncertainty and disputes at a later stage.

For more information see our Litigation Notes blogpost on the decision.