The legal fallout from the September 11 terrorist attacks on the World Trade Centre (WTC) in New York moved forward in the Supreme Court of Bermuda yesterday, after a writ was filed involving the property lessees and two insurance companies.

The writ was in the matter of the Evidence Act 1905 and concerning the civil matter now before the United States District Court for the Southern District of New York, between SR International Business Insurance Company Ltd. and World Trade Centre Properties LLC, et al. The second part of the same writ was filed by World Trade Centre Properties LLC. et al, against Allianz Insurance Co, et al.

Lawyers in the matter are Milligan, Whyte and Smith, but no one from the law firm could be contacted for comment yesterday.

Johnathan Dodd, head of finance and operations for North America of Allianz Risk Transfer was also unavailable for comment yesterday.

The automated answering machine at the United States District Court for the Southern District of New York could not be penetrated yesterday despite repeated attempts.

And no one could be contacted at SR International Business Insurance Company Ltd.

The case involves plaintiff SR International Business Insurance Company Ltd., a subsidiary of Swiss Re (Swiss Re), that writes excess surplus lines and is chartered in the United Kingdom with its principal place of business there.

The company's attorneys Simpson Thatcher and Bartlet have launched a compalint to obtain an adjudication of the rights and obligations of the parties under certain first-party insurance coverage following the September 11 terrorist attacks on the World Trade Centre.

In their complaint for declaratory relief filed in the Southern District Court of New York, Swiss Re's attorneys said that an investor group led by Larry Silverstein leased the WTC on July 16, and Swiss Re agreed to provide a share of approximately $3.5 billion in property damage insurance coverage. Swiss Re said coverage was subject to the express condition that Swiss Re agree on the terms of the coverage and at the time of the attack, certain policy wording had not yet been finalised.

Swiss Re said the company was prepared to honour insurance obligations following the attack, based upon insurance policy language provided by Mr. Silvertein's representatives, and offered to pay $75 million to all of the insureds.

However, in making their application to the court, Swiss Re said: "The potential payment to the Silverstein Group for years of lost rental income could erode coverage to which other insureds under the policy are entitled for purposes of rebuilding.

"Because there is insufficient insurance to both rebuild the World Trade Centre and to fund years of rent interruption to the Silverstein Group, Swiss Re seeks a judicial declaration of its rights and obligations to all of the insureds under the policy so that none of the insureds is prejudiced."

The submission said: "The Silverstein Group through Mr. Silverstein has advanced what has been characterised in the press as the "audacious" theory that the Silverstein group is entitled to multiply by two the face value of insurance that Swiss Re and other insurers provided under the World Trade Centre coverage.

"Specifically, Mr. Silverstein has characterised the September 11 terrorist attack as two separate insurance losses, allegedly entitling the insured to twice the amount of insurance these insured purchased."

The total insurance coverage was $3.5 billion and Swiss Re agreed to underwrite 22 percent of the lessees' coverage, excess of the primary $10 million layer.

However, at the time of the attack, Swiss Re submitted: "...Certain policy wording had not yet been finalised and no policy was ever issued."

Insureds included World Trade Centre Properties LLC, Silverstein Properties Inc., Silverstein WTC Managment Co. LLC., Port Authority of New York and New Jersey, GMAC Commercial Mortgage Corporation, UBS Warburg Real Estate Investments Inc, Westfield Inc., Westfield WTC LLC., Westfield Corporation, Westfield America Inc., 1 World Trade Centre LLC., 2 World Trade Centre LLC., 4 World Trade Centre LLC, and 5 World Trade Centre LLC.