3rd Circuit Remands $1.7 Million Action to N.J. Federal Court

PHILADELPHIA - A federal court's ruling that Converium Reinsurance (North America) Inc. is liable to Princeton Insurance Co. for $1.7 million under a reinsurance treaty has been vacated by the 3rd Circuit U.S. Court of Appeals, which found that the terms of the treaty's warranty provision are ambiguous. Princeton Insurance Co. v. Converium Reinsurance (North America) Inc., No. 08-2136 (3rd Cir.).

The lower court failed to consider the effect of the "deemer" language in the warranty, which "redefines the limits" of the treaty, the 3rd Circuit ruled in a Sept. 14 opinion.

In July 1995, Princeton Insurance Co. entered into …