“terms may be implied in order to give effect to the principle of utmost good faith underlying every contract of insurance, such as those obliging insurers to exercise rights conferred on them for their benefit with proper regard for the interests of the assured”. 27. Mr West argues that if either implied term is accepted Norwich Union’s reasons for refusing written notice or claiming Mr Kuziw’s actions to have been unreasonable are without merit. The company contends that in the real world Mr Kuziw could not have obtained a security guard on the night in question. On the evidence, I believe that the company is right. Anders & Kern also claims that that would have been the case even had there been a pre-existing key holder contract. The company is probably right about that also. Further Norwich Union while proposing such a contract during the litigation never did so when reviewing security before the burglary. Thirdly the company rejects Norwich Union’s suggestion that Mr Kuziw should have remained in the warehouse on the basis that the insurers’ witnesses themselves conceded that he should have placed his personal security first. The company also rejects suggestions that Mr Kuziw could reasonably have brought in other Keyholders or responsible people, for example from within the company to be exposed to a risk that he himself, as the boss, would not undertake. 28. Mr Elkington rejects the need to imply the “personal safety “ term for the situation in which Mr Kuziw found himself. He submits that in general terms will not be implied into a written contract as detailed and complete as the Policy. The terms are unnecessary to give business efficacy, the Policy works without them. An implied term to either effect would contradict the allocation of risk explicitly set out in the Policy and introduce uncertainty. Terms are not implied merely because it might be reasonable to do so. 29. Norwich Union argues that even if the term as to personal danger were implied Mr Kuziw would not have been or have reasonably perceived himself to be in personal danger. Mr Elkington put forward various grounds for this but I accepted Mr Kuziw’s own perception of the position he was in and considered it to be a reasonable one.. 30. There is no basis for implying the “personal danger” term. The allocation of risk in the Policy is clear. If the alarm does not comply with the requirements of the IAC, cover will only remain in place if a responsible person remains at the premises. This does not mean that there is an obligation upon an individual to face personal danger. It means that if that person leaves the risk of burglary is borne by the company not the insurer. If the company had been properly aware of the terms of the IAC it would have made other arrangements in advance to deal with the exposure. Furthermore any term to be implied would be shaped not by the particular circumstances facing Mr Kuziw on the night of the burglary but more generally by the position as at the date the parties entered into the contract. The parties allocated the risk explicitly and if, at the date the contract was entered into Norwich Union had been asked whether it accepted that it would remain on risk if Mr Kuziw left the premises feeling that he was in personal danger the answer would not have been “yes of course” but, probably, “no”. 31. Mr Elkington puts forward similar arguments to resist the “unreasonably withheld” implied term but conceded that Norwich Union was under an obligation to consider in good faith any written request. That concession can as I see it be framed as an aspect of construction but equally as an implied term. Mr Elkington drew a distinction between the “unreasonably withheld” test and that of good faith which he argues is all that regulates such a provision. The nature of the obligation imposed on the insurer by the words “unless we agree otherwise in writing .…” is discussed in a passage in Lewison on The Interpretation of Contracts (3rd ed 2004) at pp 407-411, 13.15 and in the cases referred to relied on by both parties. Thus where a contract is to be performed to the satisfaction of one of the parties it will usually be implied that he or she should act reasonably. The application of this principle to other situations has attracted a variety of characterisations. It does not follow from the fact that a contract contains an option to one party to consent that a term will be implied that it is not to be unreasonably refused as one sees from the approach of The Court of Appeal in Gan v Tai Ping (nos 2 and 3) [2001] 1 Lloyd’s 667. In that case the issue was whether a claim should be settled “without the prior approval of re-insurers”
“any withholding of approval by re-insurers should take place in good faith after consideration of and on the basis of facts giving rise to the particular claim and not with reference to considerations wholly extraneous to the subject matter of the particular re-insurance”. 32. Norwich Union also argues that even if a reasonableness term were implied it would not have been unreasonable for it to refuse its agreement to Mr Kuziw leaving the premises. Mr Kuziw had not read the policy and was unaware of the terms of the IAC. It was reasonable for Norwich Union to assume that Keyholders would be familiar with the IAC and either put in place arrangements to prevent the situation which occurred on 16 April or accept that the risk was the company’s. Mr Kuziw had made no attempt at all to call security guards, Keyholders or employees. There was no particular threat or awareness of impending burglary. The warehouse contained a large quantity of high value stock in premises that should not have been left unattended or unalarmed. 33. Since, in practice, an insurer is always free to “agree otherwise”, whatever the policy says I assume that the use of express words has a purpose. In the ordinary way one would expect those words to be invoked in less urgent circumstances than those which faced Mr Kuziw, otherwise the agreement would not be required to be “in writing”