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Category: Insurance case law · Reviewed by Chrissie Anderson, Client Executive · Last reviewed June 2026
Kajima UK Engineering Ltd was the main contractor engaged by the Joseph Rowntree Foundation to design and build a block of flats at 45 North Street, Leeds, known as “Caspar II”. The development used the relatively novel technique of stacking pre-constructed pods over five storeys. After the works were completed a series of defects emerged in the accommodation pods, beginning with excessive settlement and movement and extending, over the following years, to increasingly serious and extensive problems. Concerned about the scale of the emerging defects and about the prospect of future claims by the employer and others, Kajima gave its professional indemnity insurer, The Underwriter Insurance Company Limited a written notification, dated 22 February 2001, that the accommodation pods were settling and moving excessively and causing adjoining roofing, balconies and walkways to distort, with an investigation then under way to identify the cause and potential effects. The period of insurance expired on 19 May 2002 and the insurer went into solvent run-off. The further defects came to light afterwards, and Kajima sought to bring them within the February 2001 notification. Akenhead J was asked to determine how far that notification extended. He held that it was effective only in relation to the specific circumstances notified, and not to other matters, loss, defects or damage — save to the extent that those other matters caused, related to or contributed to the notified circumstances, or were caused by them. It was not enough that a continuing history of investigation had coincidentally revealed further defects.
The principal issue was whether a “block notification” of all defects in a particular project — without identifying the specific acts, errors or omissions said to give rise to potential claims — amounted to a valid notification of circumstances within the meaning of the policy. Subsidiary issues included: (i) the level of detail required for a valid notification, in particular whether the insured must identify the specific defects, the potential claimants and the nature of the potential claims; (ii) whether the insured’s state of awareness at the time of notification could embrace defects that had not yet been identified in detail; (iii) whether the link required between notified circumstances and later claims could be established where the notification was generic; and (iv) the practical consequences for risk allocation between insurers in different policy years.
The court (Akenhead J) held that the block notification was not a valid notification of circumstances within the meaning of the policy in respect of defects that had not been identified or were not known to Kajima at the time of the notification. The judge reviewed the existing authorities on circumstances notifications, including J Rothschild Assurance v Collyear, HLB Kidsons v Lloyd’s Underwriters and the Court of Appeal in Friends Provident v Sirius. He held that a valid notification requires the insured to identify, with reasonable specificity, the circumstances said to be capable of giving rise to a claim, and that a blanket or “kitchen-sink” notification, untethered to identifiable facts, will not fix cover for unspecified future claims. Defects of which the insured was not aware at the time of notification could not, by definition, be circumstances of which the insured was then aware, and could not therefore be included within a valid notification. The court did, however, accept that the block notification could be effective in respect of defects of which Kajima was actually aware at the time of notification, provided there was a sufficient causal link between those defects and the later specific claims.
A valid notification of circumstances under a claims-made liability policy requires the insured to identify the matters being notified with sufficient specificity to enable the insurer to understand what is being notified. The insured must have actual awareness of those circumstances at the time of notification. A blanket or “block” notification covering unspecified or unknown future defects is not a valid notification in respect of matters of which the insured was not aware at the time. To attach a later claim to a notification, there must be a sufficient causal link between the notified circumstances and the claim subsequently made.
Kajima is the leading TCC authority on the validity of block notifications in construction professional indemnity insurance and is widely cited in coverage disputes in the construction sector and beyond. For brokers, the decision is a strong warning against the practical temptation to give broad-brush notifications at year end without underlying particularity: such notifications are unlikely to protect the insured and may expose the broker to allegations of negligent year-end advice. For claims handlers and underwriters, the decision provides a framework for assessing borderline notifications and for declining notifications that are too general or speculative. For policyholders in design-and-build, civil engineering, mechanical and electrical engineering and similar sectors, the case is a reminder that year-end notifications should be supported by a structured review of known defects, complaints and potential claims, with each identified matter notified by reference to the act, error or omission relied upon, the potential claimant where known, and the nature of the potential loss. Apex Insurance Brokers references Kajima in client briefings on construction professional indemnity cover and in year-end notification protocols for design-and-build clients.
By Apex Insurance Brokers on 2026-06-06. Next review: 2026-12-06.
This entry is part of the Apex Insurance Wiki. Last reviewed by Apex Insurance Brokers on 2026-06-06. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.
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