On Friday November 16, 2018 the Joint Court of Justice ruled in a St. Maarten case of Nagico versus JLA Productions. This judgment is unique because the Court rules that a provision in the law of French St. Maarten qualifies as a rule of precedence that must be applied to a Dutch St. Maarten insurance agreement. The Court found for JLA Productions.
Lawyers Sophie van Lint and Rogier van den Heuvel of VanEps Kunneman VanDoorne assisted JLA Productions in this case. The reason was a serious traffic accident that had been caused by an employee of JLA Productions on the French side of St. Maarten. JLA Productions paid the damages to the victim and then relied on its third-party insurance with Nagico. However, they rejected full coverage because the insurance agreement included a coverage limitation of NAf. 90,000.
The said coverage limitation is valid pursuant to the law of Dutch St. Maarten and according to the Court the insurance agreement was also governed by the law of Dutch St. Maarten. According to mandatory law of French St. Maarten this kind of coverage limitation is, however, null and void. According to the Court the provision in the law of French St. Maarten is a provision of public order as a result of which violation of it also results in invalidity according to the law of Dutch St. Maarten (section 40 of Book 3 of the Civil Code).
Namely, the Court qualifies the provision as a rule of precedence. This implies that France attaches such importance to the enforcement of its political, social or economic organization that it must be applied to every instance that falls under the scope, regardless of the law that applies to the agreement. According to the Court, a serious imbalance would arise in French insurance law on this subject if the choices made by the Dutch legislator of St. Maarten would directly affect the French jurisdiction of St. Maarten. ‘Especially, as is generally known, because there is very intensive road traffic between both parts of the island’, according to the Court.
The judgment of the Court in this case has far-reaching consequences for insurers on St. Maarten as they can no longer rely on a coverage limitation regarding damages that were incurred on the French part of St. Maarten.