Supreme Court junks Ayala suit vs insurance firm

November 14, 2018

THE Supreme Court has junked the petition of Ayala Land Incorporated (ALI) seeking to hold an insurance company liable for the 2007 Glorietta 2 explosion that killed 11 people and injured 108 others.

In a five-page resolution dated October 17 but only made public yesterday, the SC denied the petition for review filed by ALI for failure to show that the Court of Appeals erred in its decision dated April 13, 2018 and resolution dated August 7, 2018.

The decision and resolution upheld the January 26, 2017 decision of Branch 65 of the Makati RTC junking ALI’s complaint for specific performance and damages against Standard Insurance.

The ruling said the explosion was caused by explosive device as earlier affirmed by the RTC and CA rulings, and was an act of terrorism, “an excluded risk” from insurance policy.

“It is a settled rule that findings of fact of the trial court are entitled to great weight and respect, especially so, such as in this case that the RTC and the CA are all in agreement that Ayala Land cannot recover under its ‘Commercial All Risk Collective Policy’ with Standard Insurance since the loss or damage of the property insured was caused by an excluded peril under the policy,” the SC said.

It added that under the policy, Standard Insurance undertook to indemnify ALI in any sudden and accidental physical destruction or damage of its property except if the damage or destruction was caused by an excluded risk.

These “excluded risks” include pollution, war, invasion, act of foreign enemy, hostilities or warlike operations, mutiny, and acts of terrorism.

Likewise, the SC said ALI has also numerously declared, and as found by its own investigators, that the explosion was caused by an explosive device, which constitutes an act of terrorism.

It noted that ALI even released an official press statement stating its disappointment as to the finding of the Multi-Agency Task Force that the cause of the explosion was the build-up of methane gas and diesel vapor at the basement and not due to an explosive device.