Santander Triumphs in Appeal Against £677 Million PPI Compensation to AXA

Santander won their appeal against a ruling requiring them to pay AXA £677 million for mis-sold payment protection insurance costs. The Appeal Court found Santander wasn't obliged to reimburse costs from policies sold before 2005. AXA will repay most of the amount previously awarded.

Santander has successfully appealed a previous London court decision which had mandated them to pay French insurer AXA approximately £677 million concerning the mis-selling of payment protection insurance (PPI) in the United States. The Court of Appeal has overturned the High Court's earlier ruling, discerning that Santander was not accountable under a 2000 agency agreement for costs correlated with store-card PPI policies sold prior to 2005.

The indemnity clause invoked by AXA was adjudged by Judge Sara Cockerill to apply only to acts or omissions after the December 1, 2000, agreement initiation, excluding policies sold before this period. As a result, the appeal court's verdict invalidates the prior judgment that awarded AXA a significant indemnity, inclusive of interest, associated largely with pre-agreement policies.

AXA's subsequent cross-appeal to recover part of its PPI compensation costs was likewise dismissed. In response to the judgment, Santander expressed relief and noted that AXA must now reimburse "the substantial majority of the amount" previously paid. Nevertheless, Genworth's President and CEO Tom McInerney expressed his dismay at the ruling while exploring future legal avenues.