Court Denies Westfield Wtc Claim
The Age
Friday September 27, 2002
Sydney
Westfield remains confident it has enough insurance coverage to protect it from the loss of income after the collapse of the World Trade Centre despite a US court ruling that the destruction of the World Trade Centre was one event rather than two.
The Federal District Court in New York ruling on Wednesday means payment to the Trade Centre claimants will be lower than first hoped.
Claimants include Westfield America, US developer Larry Silverstein who owned the World Trade Centre office towers and others. They claimed that under the insurance policies the attacks were two occurrences - the two aircraft hitting the towers being one event and the towers collapsing another. Under this scenario, more money should be paid out.
The main issue for Westfield America, which owns the 99-year lease on the towers' 40,000-square-metre shopping plaza, is getting plans approved to rebuild the complex.
About $US7 billion ($A12.8 billion) is said to be available for claimants, although it could take years before any large cash payments are made.
Westfield took out terrorist insurance when it bought the lease in May, 2001 and is expected to receive up to $A3 billion from that policy.
Already $US150 million in insurance proceeds have been paid, of which Westfield America Trust's share is $US17.3 million.
Wednesday's hearing only comprised three claims out of the 22 insurers that Westfield has outstanding claims against.
The retailer now has to battle another 17 insurance companies on a range of issues related to the World Trade Centre attacks.
Westfield said the litigation with the other 17 insurers would take some time to get through.
In a statement on the latest court rulings, Westfield said: ``These three insurers' coverage amounts to a total of $US112 million per occurrence, so that limiting these insurers to a single occurrence does not have a material effect on the overall amount of $US6.7 billion that is potentially available from all the World Trade Centre insurers participating in the litigation.
``The trust remains confident that the property insurance policies are adequate to protect its investment and to reimburse it for expected business interruption losses due to the terrorist attacks."
© 2002 The Age
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