High Court to decide if insurer must pay over clifftop house left ‘unstable’ after partial cliff collapse

Dunmore East property is holiday home of the well-known Waterford family behind Ardkeen Quality Food Store

A dispute about whether insurer Aviva must pay out over a clifftop holiday home belonging to a well-known Co Waterford family being allegedly rendered “unstable” following a partial cliff collapse can proceed to hearing in the High Court, a judge has directed.

There is an “ongoing risk” that the property will collapse, it is claimed in the proceedings.

Gerald Jephson is an executor of the estate of his father, Robert C Jephson, who, together with his wife Pamela, founded Ardkeen Quality Food Store in Waterford in 1967, an award-winning independent food retailer. Robert Jephson died in March 2010, his wife died in May 2020 and the business is now run by their sons.

In proceedings against Aviva Insurance Ireland DAC, Gerald Jephson claims the family holiday home at Yellow House, Dunmore East, was insured against risks including subsidence, landfall, landslip and/or land heave.

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Located on a north-facing clifftop overlooking the main beach in Dunmore East, the property was rendered unstable following the collapse on January 15th, 2010, of a portion of the cliff on which it is situated, he claims.

The foundation is exposed, has been severely undermined and the corner affected by the cliff collapse is now unsupported, it is claimed.

Due to the loss of ground under and adjacent to the property as a result of the cliff collapse there is an ongoing risk of further collapse of that ground and of collapse of the building, it is further claimed. Further minor collapses have occurred since 2010, Mr Jephson has pleaded.

A core issue in the dispute with Aviva concerns whether the cover for the property underwritten by Aviva was on the basis of a HomeChoice or Homepak policy.

Mr Jephson claims the HomeChoice policy applies and its 2010 wording provided cover for loss or damage to buildings and home contents caused by subsidence, heave or landslip of the land on which the property stands.

Aviva disputes this and maintains the Homepak policy, which specifically excluded property damage caused by subsidence, landfall, landslip and/or land heave from the scope of cover, was the policy which applied in January 2010.

The High Court case was initiated in 2017 but a stay was granted in January 2020 pending arbitration of the dispute.

In late 2021, Mr Jephson initiated an application for an order lifting the stay, claiming breach of an undertaking provided on behalf of Aviva to participate in the arbitration in a “timely and efficient” fashion.

Aviva disputed the claim of unacceptable delay on its part. It pleaded some delay was as a result of the Covid-19 pandemic and claimed it had sought trial of a preliminary issue in the arbitration concerning which policy applied. It said Mr Jephson’s side opposed this, arguing there should be a unitary hearing of all issues of fact and law.

In his recently published judgment on the application to lift the stay, Mr Justice Mark Sanfey concluded that Aviva had not conducted the arbitration in a “timely and efficient” fashion.

The delays involved, of more than two years, “manifestly justify” Mr Jephson seeking to have the stay lifted, he held.

In the circumstances of the case, Mr Jephson is entitled to an order lifting the stay, the judge ruled.

He said he expected both sides to agree directions with a view to having the case heard as soon as possible and any application by Aviva for an order permitting the trial of a preliminary issue concerning which insurance policy applies should be made without further delay.

Mary Carolan

Mary Carolan

Mary Carolan is the Legal Affairs Correspondent of the Irish Times