Tom's direct claim against Atlas after Ridgeway's liquidation

The 2010 Act transfers the insured's rights against the insurer to a third party when the insured becomes a 'relevant person', which includes a company in creditors' voluntary liquidation. The purpose is to prevent the insurance money being treated as an asset of the insolvent estate and to allow the injured claimant to pursue the insurer directly.

Tom must establish four things. First, RCL is a relevant person and the rights have transferred. Second, RCL is liable to Tom; here he has a judgment for £180,000, which establishes that liability. Third, the liability is one covered by the policy, subject to its terms, limits and exclusions. Fourth, Tom has complied with the Act's procedural requirements, including providing Atlas with the relevant information and documents. The 2010 Act allows Tom to bring proceedings against Atlas to enforce the judgment or to establish the insured's liability and the insurer's liability in one set of proceedings. He does not need to sue RCL again. Atlas stands in RCL's shoes and can raise the defences it would have had against RCL.

Atlas can rely on the late notification if the clause is a true condition precedent to liability and the breach has not been waived. The clause says 'condition precedent' and requires notification within 30 days. The liquidator waited seven months, by which time the site had been cleared and witnesses had dispersed. On ordinary principles, a condition precedent of this kind entitles the insurer to refuse liability, and the 2010 Act does not remove that defence: the third party takes the rights 'subject to the same defences'. Prejudice is not strictly required where the clause is a condition precedent, but the evidence of prejudice strengthens Atlas's position. Tom could argue that Atlas waived the breach by corresponding without reserving its rights, or that the clause should be read as requiring only notification within a reasonable time. He could also argue that the delay was caused by the insolvency and that Atlas suffered no prejudice, but that argument is weaker where the clause is clearly drafted as a condition precedent.

Insolvency itself is not a defence. It is the trigger for the 2010 Act. Atlas cannot refuse simply because RCL is insolvent; it must point to a policy defence. If the policy contains an insolvency exclusion, that would be different, but none is mentioned.

Tom should notify Atlas in writing, provide the judgment, proof of RCL's liquidation, the policy number and any correspondence about the claim. He should ask Atlas to confirm its position and to provide copies of the policy, endorsements and any claims correspondence. He should preserve the judgment, the liquidation records and the evidence about the accident. He should also check whether RCL's liquidator has any files or assets that could assist.

Under the 2010 Act, the insurer must provide information and documents to the third party on request. If Atlas refuses, Tom can apply to court for an order requiring disclosure. He should act promptly because limitation periods continue to run. If Atlas maintains the late notification defence, Tom should consider whether the clause was incorporated, whether it was waived, and whether the delay was caused by RCL's insolvency rather than by Tom. He may also have a complaint to the Financial Ombudsman Service only if he is an eligible complainant, which is unlikely for a commercial liability claim of this kind, so court proceedings are the more realistic route.