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A judge takes Michael Flatley’s dispute over an insurance claim relating to a Cork residence to arbitration

A High Court judge has ordered that a dispute between Lord of the Dance star Michael Flatley and his former insurance company over a €30 million claim on a policy on his Cork estate in Castlehyde must be resolved by arbitration rather than in a courtroom.

The latest move in the Flatley Castlehyde drama came when the former Riverdance performer lost a High Court case seeking to prevent his multi-million pound claim against high-end insurance company Hiscox over Castlehyde’s alleged faulty workmanship from going to out-of-court arbitration.

Judge Michael Twomey rejected Mr Flatley’s claim that Hiscox, in attempting to persuade Mr Flatley to enter arbitration rather than litigate the dispute with him, was seeking to avoid liability to him.

The judge said: “On the contrary, in the view of this court, it is Mr Flatley who is seeking to avoid liability to Hiscox. This is because, in the plain English wording of the arbitration clause, he agreed to arbitrate any disputes he had with Hiscox. However, he is seeking to avoid liability to Hiscox and is now seeking to resolve his dispute.”

Judge Twomey said for this reason the court had no hesitation in referring the dispute to arbitration, especially as there was nothing “unfair” about the possibility that Mr Flatley would have to pay his own legal costs and Hiscox’s costs if the arbitrator found that the case against him claim against Hiscox.

In the main Commercial Court proceedings, Mr Flatley claims he and his family had to leave Castlehyde in October 2023 after residues of toxic chemicals were discovered during routine maintenance work. File photo: Gerard McCarthy

In an affidavit given to the High Court during the hearing, Mr Flatley claimed that the high-end insurance company that covered his Fermoy property until earlier this year had attempted to transfer his consumer home insurance policy to a commercial policy in order to invoke the Arbitration Act.

Hiscox Societe Anonyme’s application to the High Court to bring proceedings in the big business Commercial Court – where Mr Flatley is suing several parties over alleged damage to the residence – stayed pending arbitration.

In the main Commercial Court proceedings, Mr Flatley claims he and his family had to leave Castlehyde in October 2023 after residues of toxic chemicals were discovered during routine maintenance work. He sued several parties, including Hiscox.

Friday’s verdict

In his judgment, Judge Twomey said that under the terms of a Castlehyde insurance policy negotiated by a specialist insurance broker, Flatley had agreed to pay an annual premium of €69,285 for property insurance.

The key issue in the case, the judge said, was whether an arbitration agreement, as opposed to a dispute resolution agreement, constituted an unfair term in a consumer contract that would entitle Mr Flatley to avoid the consequences of his agreeing to arbitration under the terms of his Hiscox policy.

The judge found that the fact that the arbitration clause in the insurance policy did not provide that Mr Flatley would never incur legal costs was not a basis for Mr Flatley to claim that the clause was unfair and therefore did not constitute a basis for him to avoid consequences of his consent to this arbitration clause.

The judge said Mr Flatley appeared to have claimed he was unaware of the arbitration clause when he agreed to the Castlehyde insurance policy in November 2023. Judge Twomey said Mr Flatley appeared to have signed the arbitration clause, likely relying on advice from insurance experts , and not after reading the policy yourself.

The judge found that there was no evidence that Mr Flatley’s agent was not aware of the clause before Mr Flatley agreed to the policy and therefore Mr Flatley should be deemed to have been aware of what his agent knew.

“Accordingly, Mr Flatley’s claim that he was personally unaware of the arbitration clause, in the view of this court, leads him nowhere,” the judge added. The case will go back to court next week.