Engineer takes insurance companies to court to recover costs for work on bridges in Africa and the Americas.
British bridge-building firm Mabey & Johnson is suing five insurance companies in a wrangle over who should foot the bill for repairs to 49 bridges built in developing countries during the early 1990s.

Mabey & Johnson, a subsidiary of multinational engineer Mabey Group, says the insurers agreed to pay 20% of the cost of remedial work in each case, with a ceiling of £2m a bridge.

The insurers reject this interpretation of the insurance contract, signed in March 1996. They say that they are only obliged to provide cover for one claim, and that they have discharged their liability by paying £1,791,930.30 for the original collapse and incurring costs of £208,069.50.

The firms being sued are CAN-Re, International Insurance of Hannover, Ecclesiastical Insurance, Unionamerica Insurance and Skandia International Insurance Corporation. The final two companies are subsidiaries of multinational reinsurer Hannover Re.

After the collapse of a bridge over the river Omo in south-west Ethiopia seven years ago, in September 1996, Mabey & Johnson had been concerned about problems that might occur with bridges it had built in Peru, the Dominican Republic and Ghana between 1992 and 1995.

We hope the dispute will be resolved by the court hearing in February

Richard Glover, Mabey & Johnson

The writ states: "Mabey & Johnson also realised that other bridges it had supplied might collapse, leading to other claims from customers."

Richard Glover, the commercial director of Mabey & Johnson, said the bridge collapse in Ethiopia was caused by a design fault for which the company accepted responsibility.

Glover said: "The remedial work took place from 1997 to 2000. We don't want to go into the details of the claim, but we hope the dispute will be resolved by the court hearing in February next year."

Mabey & Johnson is seeking a High Court declaration that under the contracts it took out in 1996, the insurers agreed to pay 20% of any sum for which Mabey & Johnson became legally liable as a result of negligence. The engineer has spent £6m on repairs so far.

The writ states that Mabey & Johnson paid a premium of £103,496 for its professional negligence insurance in March 1996.

The bridge over the Omo collapsed on 24 September 1996, leading to a claim by client Salini Costruttori SPA. Mabey & Johnson, which designed the bridge, paid £850,000 to settle the claim in 1997.