Australia Japan Cable is suing Pender Insurance Ltd, the Cable & Wireless captive, for substantial damages following its refusal to cover an insurance claim made in 2001 for loss of part of its cable network during construction.

AJC last week issued proceedings in the English commercial court against Pender Insurance Ltd, the former insurance captive subsidiary of Cable & Wireless plc.

The proceedings relate to an insurance claim made by AJC as a result of an incident in January 2001 during construction of AJC's fibre-optic system between Australia and Japan. The incident delayed completion and coming into service of the system and Pender insured AJC for the resulting loss of revenue. After two years of dealing with the claim, Pender formally denied cover.

AJC is now seeking a declaration that the claim is covered and an assessment of quantum currently estimated by AJC at in excess of $90m. AJC's CEO Robin Russell said: "We have been dealing with representatives of Pender during the placement, and then during the claims process, who are now the subject of a lawsuit brought by Cable & Wireless, and have decided that the only way to progress the claim is to commence proceedings against Pender. We have tried to engage with C&W about settling the claim but they have been unresponsive. We trust that these proceedings will serve as a framework for a resolution of the issue."

AJC is represented in London by Holman Fenwick & Willan partners Paul Wordley and Guy Hardaker.Australia Japan Cable Network FeaturesRoute Australia to Japan via GuamConfiguration A 12,700km optical fibre cable in a collapsed loop configuration employing 10Gbit/s DWDM technology. Branch protection for fishing or shipping risks via double landings in Japan, Guam and Australia. Single sheath in deep water (>4000m) for some 90% of the route. AJC includes automatic network protection operating ring and span switching in accordance with ITU-T Rec G.841 MS SPRING (Transoceanic Application), to protect against equipment, fibre or cable faults.Capacity Design: 320 + 320 Gbit/s (Service plus Protection)Initially equipped for 40 + 40 Gbit/s (Service plus Protection)Cable stations In Australia two cable stations close to the Sydney CBD.In Guam, two cable stations close to the Guam business center.In Japan, two cable stations close to Tokyo.AJC cable stations have been selected to maximize connectivity options, and feature collocation with other major cable networks in the Pacific region.Terrestrial links The cable stations in Australia and Guam are joined by terrestrial links and form part of the AJC owned network. The Japanese landing stations are joined by a submarine link, also owned by AJC. Ready for Service 30 December 2001Connectivity AJC was designed to connect to major existing and planned cables in the Asia-Pacific area. Notably AJC connects to China-US and Japan-US in the same cable stations in Guam and Japan. Other cables landing within a few km of AJC include APCN2, PC1, EAC, C2C, RNAL, G-P, SCCN and TGN.Network Operations Centre (NOC) AJC NOC functions include management of traffic through all AJC cable stations plus monitoring of all AJC cable, repeaters and terminal equipment. For AJC network security, AJC also maintains backup NOC equipment in separate locations.