Allseeds Switzerland SA v Intergrain SA

A CIF seller must provide an effective insurance policy. A policy is ineffective where it is void or voidable for misrepresentation or non-disclosure, unless insurers have affirmed it. Buyers cannot establish breach merely by proving that insurers rejected a claim, or that grounds for rejection might have existed. They must establish that the policy was legally or factually ineffective on those grounds.

On a statutory appeal from an arbitral award, the hearing judge is not strictly bound by the permission judge’s decisions on the qualifying hurdles. However, highly unusual circumstances are required before those decisions will be revisited. The award was remitted for reconsideration.

The claimant sellers appealed under section 69 of the Arbitration Act 1996 from a FOSFA Appeal Board award concerning a CIF sale of Brazilian soybeans. The Board had upheld findings that the sellers were in breach because cargo insurers had rejected cover and treated the policy as null and void, although Belgian proceedings concerning the policy’s validity remained unresolved.

Permission to appeal was granted on two questions: whether buyers had to prove that insurers were entitled to reject the claim, and whether it was sufficient to show that grounds for rejection might have existed. The court determined both questions and considered whether the award should be remitted.

1. The court declined to revisit whether the questions permitted under section 69 were questions which the Appeal Board had been asked to determine. Although the appeal judge is not strictly bound by permission-stage decisions, highly unusual circumstances are required before the component parts of the permission test are revisited. No such circumstances existed here. This approach was consistent with the policy of the Arbitration Act 1996 and the overriding objective.

2. The obligation of a CIF seller is to provide an effective insurance policy. A policy is not effective where it is void or voidable for misrepresentation or non-disclosure, unless insurers have affirmed it notwithstanding its voidability. Buyers must prove more than the insurers’ rejection of a claim on the basis that the policy was void or voidable. They must establish that the policy was in fact void or voidable.

3. Similarly, buyers do not establish breach merely by proving that grounds existed on which insurers might have relied to reject the claim. It must be established that the policy was legally and/or factually ineffective on those grounds.

4. The Appeal Award was remitted to the Appeal Board under section 69(7)(c) of the Arbitration Act 1996 for reconsideration in light of those determinations. On remission, the Board could determine whether the answers affected the result previously reached. The defendant was ordered to pay the costs of the appeal.

• FOSFA First Tier Tribunal — Award No. 4804 dated 15 October 2023. The Tribunal found the sellers in breach of their CIF insurance obligations.
• FOSFA Board of Appeal — Appeal Award No. 1209 dated 13 November 2024. The Board upheld the finding of breach.
• High Court (Commercial Court) — Permission to appeal was granted by Dias J on 9 April 2025. The appeal court determined the questions of law and remitted the Appeal Award for reconsideration.