Client alerts.

Indemnity costs after the August reinsurance judgment

The Commercial Court's decision this month is being read as a construction case. The more consequential part of the judgment is the costs order, which was made on the indemnity basis on the ground that the claim was pursued after the claimant's own contemporaneous documents had been disclosed.

The practical effect is to raise the cost of continuing a weak claim past disclosure. Parties defending large constructed claims should be putting the other side on notice, in correspondence that will be read on costs, at the point the documents undermine the pleaded case rather than at trial.

For claimants the discipline runs the other way. A claim that survives disclosure unamended now carries a costs risk materially larger than it did a year ago.

Prepared by Eileen Halloran, Senior Partner. This alert is general information and is not legal advice.

Most of these cases should settle, and most of ours do

We are a firm that tries cases, so it is worth saying plainly that we advise settlement more often than we advise trial. Roughly two thirds of the matters we accept end without a hearing.

The reason to prepare a case for trial is not that it will be tried. It is that the settlement number is set by what the other side thinks will happen if it is, and that number moves when the preparation is visible and real. A case built for settlement settles cheaply. A case built for trial settles well, and occasionally has to be tried.

Prepared by Eileen Halloran, Senior Partner. This alert is general information and is not legal advice.

Controller transactions: what the 2026 decisions changed

A run of decisions this year has tightened what a special committee has to be able to show. The recurring failure is not the price. It is the record of how the committee was constituted and what it was told at the point it was asked to approve.

Three practical consequences follow. Committees that are formed after negotiations have begun are being treated as having ratified rather than negotiated. Advisers retained by the controller and then repurposed for the committee are being discounted. And contemporaneous minutes that record conclusions without recording the alternatives considered are being read against the party that drafted them.

For minority holders, the books and records demand remains the most efficient first step, and it should be made before the transaction closes rather than after.

Prepared by Tomás Reyes, Managing Partner. This alert is general information and is not legal advice.

Credit agreement disputes: the drafting has caught up, the conduct has not

Liability management transactions have produced a body of litigation now mature enough to draw lessons from. Documentation has tightened in response, but the disputes have not slowed, because the pressure that produces these transactions has not eased.

The recurring issue is process rather than permission. Where a transaction is technically permitted by the credit agreement, claims are being framed instead around the implied covenant, the sequencing of consents, and the conduct of the agent. Minority lenders who organise early and preserve their communications are in a materially better position than those who wait to see the terms.

Cooperation agreements should be drafted on the assumption that they will be read aloud in court.

Prepared by Adaeze Okonjo, Partner, Head of London. This alert is general information and is not legal advice.

Enforcement against state assets after the 2026 immunity decisions

Award creditors have spent a decade working around the commercial use exception to sovereign immunity. A series of decisions this year has narrowed the space further, and the practical consequence is that attachment strategy now has to be designed at the pleading stage rather than after the award.

Three points follow. The characterisation of the debtor matters more than it did, because separate juridical personality is being respected in jurisdictions that previously looked through it, so the respondent named in the arbitration will constrain what can be attached years later. Evidence of the commercial purpose of an asset is being required at the point of attachment rather than inferred from its nature. And central bank and diplomatic accounts remain effectively unavailable, so time spent on them is time the debtor uses to move everything else.

Creditors should expect enforcement to run in three or four jurisdictions in parallel, and should assume the first application will be contested on immunity grounds regardless of merit.

Prepared by Priya Raval, Partner, Head of Enforcement. This alert is general information and is not legal advice.

Self-reporting: the decision and its disclosure consequences

The decision whether to self-report is usually taken under time pressure and on an incomplete record, and it is almost always taken before anyone has considered what the report will do to the civil proceedings that follow.

A self-report is a narrative prepared by the company about its own conduct. In later civil litigation it becomes a document the claimant will seek, and in a second jurisdiction it becomes a roadmap for an authority that had not yet opened a file. Boards should be told, before they authorise a report, what privilege will and will not survive it in each jurisdiction where the conduct occurred.

None of this argues against self-reporting. It argues for sequencing the investigation so that the report can be made from findings the company has tested rather than from findings it has assumed.

Prepared by Jun Koda, Partner, Investigations. This alert is general information and is not legal advice.

Sanctions and force majeure: four years of decisions, one pattern

Tribunals and courts have now considered a substantial volume of contract claims arising from sanctions imposed since 2022. A pattern is discernible: relief turns less on the breadth of the clause than on what the party actually did in the weeks after the designation.

Parties that applied for licences, documented the refusal, and offered alternative performance have generally succeeded. Parties that treated the designation as automatically dispositive have generally not, even under clauses that appeared to cover the event squarely. Payment channel arguments have fared worst, because the tribunal usually finds that some route remained open.

The practical advice is unchanged and consistently ignored: build the licensing and mitigation record contemporaneously, because it will be the evidence the case turns on.

Prepared by Anton Brandt, Partner, Head of Arbitration. This alert is general information and is not legal advice.