Court Finds Dispute As To Payment Of Claim Is Arbitrable
A reinsurance contract had what is termed a narrow arbitration provision, requiring arbitration only of disputes relating to the interpretation of the contracts. The service of suit clause provided for the resolution by a court of the failure to pay an amount claimed to be due. A dispute arose as to a claim submitted under the contract, specifically whether payment should be made to the insolvent claimant or its liquidator. A US District Court has determined that since the resolution of that question requires interpreting provisions of the reinsurance contract, the dispute is arbitrable. Railroad Insurance Underwriters v. Certain Underwriters at Lloyd’s London, Case No. 07-3071 (USDC S.D.N.Y. June 4, 2007).
