While our coverage analysis is on-going and, in the meantime, we would like to share our initial views in respect of this claim to your attention.
The D&O policy attach with Professional Services Exclusion Endorsement No. 6 provide that the Insurer shall not be liable to make any payment for Loss based on arising from attributable to or in any way connected with directly or indirectly the Company’s performance or attempted performance of professional services for any person or any act, error or omission relating thereto.
Based on information at hand, Sansiri has carried its business as land and real estate developer and also expand scope of its business to property management and sales management services since Y1984 to present.
In this incident, Sansiri first received the letter dated 23 March 2015 from the Bangkok Land Development Commission and the Provincial Land Development Commission (“the Regulator”) with allegation that Sansiri did not perform maintenance duties for the public facilities in the Gallery Phutthamonthon Sai 1project cause the people who live in this project could not use public facilities as usual.
During April 2015 – Feb 2016, Sansiri had attempted to comply with the order of the Regulator, however, subsequently on 6 March 2016, the officer of the Regulator filed the complaint to the Phasicharoen Police Station provide that Sansiri violated the order of the Regulator and breached the Section no. 52, 65 and 66 under the Land Development Act B.E. 2543 for failure to repairing the public facilities (i.e. electric lamps at 6 points) and 2 directors received the summons and were fined under the law on 14 July 2016.
As the cause of fines by the Regulator did arising from the Company’s performance to provide its services. Thus we have initial views that the loss could be excluded under the Endorsement #6 as stipulated above.
In this regard, we would like to have your kind assistance to ask the ceding company to provide us as to why they consider the PI exclusion does not apply to this event.