Exhibit 5.1

(212) 701-3000

November 28, 2008

XL Capital Ltd
XL House
One Bermudiana Road
Hamilton HM 11
Bermuda

XL Capital Finance (Europe) plc
XL House
70 Gracechurch Street
London EC3V 0XL
England

Ladies and Gentlemen:

          We have acted as special United States counsel to XL Capital Ltd, a Cayman Islands limited liability company (the “Company”) and XL Capital Finance (Europe) plc, a public limited company formed under the laws of England and Wales (“XL Finance”) (the Company and XL Finance are referred to collectively as the “Registrants”), in connection with the preparation of:

          1.     the Registration Statement on Form S-3 to be filed with the Securities and Exchange Commission (the “Commission”) on the date hereof (the “Registration Statement”), pursuant to which (A) the Company proposes to issue and/or sell from time to time (i) Ordinary Shares, par value U.S. $.01 per share (together with the related Ordinary Share Purchase Rights, the “Ordinary Shares”), (ii) Preference Ordinary Shares, par value U.S.$.01 per share (the “Preference Ordinary Shares”), (iii) debt securities consisting of debentures, notes or other evidences of indebtedness representing unsecured unsubordinated obligations of the Company (the “Senior Debt Securities”), (iv) debt securities consisting of debentures, notes or other evidences of indebtedness representing unsecured subordinated obligations of the Company (the “Subordinated Debt Securities”), (v) warrants to purchase Ordinary Shares (the “Ordinary Share Warrants”), (vi) Ordinary Share purchase contracts

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obligating holders to purchase, and the Company to sell to the holders thereof, or the Company to purchase, and the holders thereof to sell to the Company, at a future date (the “Ordinary Share Purchase Contracts”) a specified number of Ordinary Shares, (vii) Ordinary Share purchase units (the “Ordinary Share Purchase Units”) consisting of one or more Ordinary Share Purchase Contracts and any one or more of (a) debt or equity obligations of third parties, including, but not limited to, XL Finance Debt Securities (as defined below) or U.S. Treasury securities, (b) Preference Ordinary Shares, (c) Senior Debt Securities or (d) Subordinated Debt Securities and (viii) guarantees of the XL Finance Debt Securities (as defined below) (the “XL Finance Debt Securities Guarantee”) and (B) XL Finance proposes to issue and sell from time to time debt securities consisting of debentures, notes or other evidences of indebtedness representing unsecured unsubordinated obligations of XL Finance (the “XL Finance Debt Securities”) that have the benefit of the XL Finance Debt Securities Guarantee;

          2.the indenture, dated June 2, 2004 (the “Senior Debt Indenture”), between the Company and The Bank of New York, as trustee (the “Senior Debt Trustee”);

          3.the indenture, dated June 2, 2004 (the “Subordinated Debt Indenture”), between the Company and The Bank of New York, as trustee (the “Subordinated Debt Trustee”);

          4.     the indenture, dated June 2, 2004 (the “XL Finance Debt Securities Indenture” and, together with the Senior Debt Indenture and the Subordinated Debt Indenture, the “Indentures”), among XL Finance, as issuer, the Company, as guarantor, and The Bank of New York, as trustee (the “XL Finance Debt Securities Trustee”); and

          5.the form of XL Finance Debt Securities Guarantee.

          The Ordinary Shares, the Preference Ordinary Shares, the Senior Debt Securities, the Subordinated Debt Securities, the Ordinary Share Warrants, the Ordinary Share Purchase Contracts, the Ordinary Share Purchase Units, the XL Finance Debt Securities and the XL Finance Debt Securities Guarantee are referred to herein collectively as the “Offered Securities.” The Offered Securities being registered under the Registration Statement may be offered on a continued or delayed basis pursuant to the provisions of Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”).

          In rendering the opinions set forth herein, we have examined originals, photocopies or conformed copies certified to our satisfaction of corporate records, agreements, instruments and documents of the Registrants, certificates of public officials and other certificates and opinions provided to us by the Company. In our examination, we have assumed (a) the due organization and valid existence of each of the Registrants, (b) the due authorization, execution, authentication and delivery by all persons of the Registration Statement and each of the documents related thereto, (c) that each such party has the legal power to act in the respective capacity or capacities in which he, she or it is to act thereunder, (d) the authenticity of all documents submitted to us as originals, (e) the conformity to the original documents of all documents submitted to us as copies and (f) the genuineness of all signatures on the Registration Statement and all other documents submitted to us.

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          Based upon and subject to the foregoing and assuming that (i) the Registration Statement and any amendments thereto (including any post-effective amendments) will have become effective and comply with all applicable laws at the time the Offered Securities are offered or issued as contemplated by the Registration Statement, (ii) a prospectus supplement will have been prepared and filed with the Commission describing the Offered Securities offered thereby and will at all relevant times comply with all applicable laws, (iii) all Offered Securities will be issued and sold in compliance with applicable federal and state securities laws and in the manner stated in the Registration Statement and the appropriate prospectus supplement, (iv) a definitive purchase, underwriting or similar agreement and any other necessary agreement with respect to any Offered Securities will have been duly authorized and validly executed and delivered by each applicable Registrant and the other party or parties thereto, (v) the execution of the applicable Indenture(s) has been duly authorized by the applicable Registrant by appropriate action, (vi) the board of directors, including any appropriate committee appointed thereby, and appropriate officers of the applicable Registrant have taken all necessary action to approve the issuance and terms of the Offered Securities and related matters, (vii) the applicable Indenture(s) have been duly qualified under the Trust Indenture Act of 1939, as amended, and (viii) any Offered Securities issuable upon conversion, exercise or exchange of any Offered Securities being offered or issued will be duly authorized, created and, if appropriate, reserved for issuance upon such conversion, exercise or exchange, we advise you that in our opinion:

1.     Insofar as the laws of the State of New York are applicable thereto, when (A) the terms of the Senior Debt Securities and their issuance and sale have been duly established in conformity with the Senior Debt Indenture so as not to violate any applicable law, the Articles of Association or the Memorandum of Association of the Company or result in default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company and (B) the Senior Debt Securities, in the form established in accordance with the Senior Debt Indenture incorporated by reference as an exhibit to the Registration Statement, have been duly executed and delivered by the Company and authenticated by the Senior Debt Trustee in accordance with the provisions of the Senior Debt Indenture and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the Senior Debt Securities will constitute valid and legally binding obligations of the Company entitled to the benefits of the Senior Debt Indenture and enforceable against the Company in accordance with their terms, except that (a) the enforceability thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws now or hereafter in effect relating to or affecting creditors’ rights or remedies generally and (ii) general principles of equity and to the discretion of the court before which any proceedings therefor may be brought (regardless of whether enforcement is sought in a proceeding at law or in equity) and (b) the enforceability of provisions imposing liquidated damages, penalties or an increase in interest rate upon the occurrence of certain events may be limited in certain circumstances ((a) and (b), collectively, the “Enforceability Exceptions”).

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2.Insofar as the laws of the State of New York are applicable thereto, when (A) the terms of the Subordinated Debt Securities and their issuance and sale have been duly established in conformity with the Subordinated Debt Indenture so as not to violate any applicable law, the Articles of Association or the Memorandum of Association of the Company or result in default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company and (B) the Subordinated Debt Securities, in the form established in accordance with the Subordinated Debt Indenture incorporated by reference as an exhibit to the Registration Statement, have been duly executed and delivered by the Company and authenticated by the Subordinated Debt Trustee in accordance with the provisions of the Subordinated Debt Indenture and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the Subordinated Debt Securities will constitute valid and legally binding obligations of the Company, entitled to the benefits of the Subordinated Debt Indenture and enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions.

3.     Insofar as the laws of the State of New York are applicable thereto, when (A) the terms of the XL Finance Debt Securities and their issuance and sale have been duly established in conformity with the XL Finance Debt Securities Indenture so as not to violate any applicable law, the Articles of Association or the Memorandum of Association of XL Finance or result in default under or breach of any agreement or instrument binding upon XL Finance or the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over XL Finance or the Company and (B) the XL Finance Debt Securities, in the form established in accordance with the XL Finance Debt Securities Indenture incorporated by reference as an exhibit to the Registration Statement, have been duly executed and delivered by XL Finance and authenticated by the XL Finance Debt Securities Trustee in accordance with the provisions of the XL Finance Debt Securities Indenture and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the XL Finance Debt Securities will constitute valid and legally binding obligations of XL Finance entitled to the benefits of the XL Finance Debt Securities Indenture and enforceable against XL Finance in accordance with their terms, subject to the Enforceability Exceptions.

4.Insofar as the laws of the State of New York are applicable thereto, when (A) the terms of the XL Finance Debt Securities and their issuance and sale and the terms of the XL Finance Debt Securities Guarantee have been duly established in conformity with the XL Finance Debt Securities Indenture so as not to violate any applicable law, the Articles of Association or the Memorandum of Association of XL Finance or the Company or result in default under or breach of any agreement or instrument binding upon XL Finance or the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over XL Finance or the Company and (B) the XL Finance Debt Securities, in the form established in accordance with the XL Finance Debt Securities Indenture incorporated by reference as an exhibit to the Registration Statement, have been

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duly executed and delivered by XL Finance and authenticated by the XL Finance Debt Securities Trustee in accordance with the provisions of the XL Finance Debt Securities Indenture and the XL Finance Debt Securities are delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the XL Finance Debt Securities Guarantee will constitute a valid and legally binding obligation of the Company entitled to the benefits of the XL Finance Debt Securities Indenture and enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

5.Insofar as the laws of the State of New York are applicable thereto, assuming (A) the execution of the warrant agreement pursuant to which the Ordinary Share Warrants will be issued (the “Warrant Agreement”) has been duly authorized by the Company by appropriate action, (B) the Warrant Agreement has been duly executed and delivered by the Company and the warrant agent thereunder, (C) the board of directors, including any appropriate committee appointed thereby, and appropriate officers of the Company have taken all necessary action to approve the issuance and terms of the Ordinary Share Warrants and related matters, including, without limitation, any necessary reservation of Ordinary Shares issuable upon exercise of the Ordinary Share Warrants and (D) the Ordinary Share Warrants, in the form included in the Warrant Agreement, have been duly executed and delivered by the Company and countersigned by the warrant agent thereunder pursuant to the Warrant Agreement and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the Ordinary Share Warrants will constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

6.Insofar as the laws of the State of New York are applicable thereto, assuming (A) the execution of the Ordinary Share Purchase Contracts has been duly authorized by the Company and each counter-party thereunder by appropriate action, (B) the Ordinary Share Purchase Contracts have been duly executed and delivered by the Company and the counter-party thereunder, (C) the board of directors, including any appropriate committee appointed thereby, and appropriate officers of the Company have taken all necessary action to approve the issuance and terms of the Ordinary Share Purchase Contracts and related matters and (D) the Ordinary Share Purchase Contracts, in an appropriate form, have been duly executed and delivered by the Company and countersigned by the counter-party thereunder and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the Ordinary Share Purchase Contracts will constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

7.Insofar as the laws of the State of New York are applicable thereto, assuming (A) the execution of the Ordinary Share Purchase Units has been duly authorized by the Company and each counter-party thereunder by appropriate action, (B) the Ordinary Share Purchase Units have been duly executed and delivered by the Company and the counter-party thereunder, (C) the board of directors, including any appropriate committee appointed

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thereby, and appropriate officers of the Company have taken all necessary action to approve the issuance and terms of the Ordinary Share Purchase Units and related matters and (D) the Ordinary Share Purchase Units, in an appropriate form, have been duly executed and delivered by the Company and countersigned by the counter-party thereunder and delivered and paid for as contemplated by any applicable purchase or underwriting agreement and the Registration Statement, the Ordinary Share Purchase Units will constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

          In giving our opinion, we are relying, without independent verification (A) as to all matters of fact, upon certificates and written statements of officers of the Registrants, (B) as to all matters of Cayman Islands law, on the opinion of Appleby Spurling Hunter, dated of even date herewith and filed as Exhibit 5.2 to the Registration Statement and (C) as to all matters of United Kingdom law, on the opinion of Clifford Chance LLP, dated of even date herewith and filed as Exhibit 5.3 to the Registration Statement.

          We are members of the Bar of the State of New York and do not purport to be experts in or to express any opinion concerning the laws of any jurisdictions other than the laws of the State of New York and the federal laws of the United States of America. In rendering the opinions set forth above, we express no opinion as to the laws of any jurisdictions other than the laws of the State of New York and the federal laws of the United States. Accordingly, our opinions expressed in paragraphs 1 through 7 above are not intended as opinions under the laws of the jurisdictions of organization of the Registrants and are intended to cover only the nature of the Indentures, the XL Finance Debt Securities Guarantee and the Ordinary Share Purchase Contracts and the Offered Securities as contracts and obligations created under and governed by the laws of the State of New York.

          We hereby consent to the reference to our firm in the Registration Statement under the caption “Legal Matters” and to the inclusion of this opinion as an exhibit to the Registration Statement. Our consent to such reference does not constitute a consent under Section 7 of the Securities Act, as in consenting to such reference we have not certified any part of the Registration Statement and do not otherwise come within the categories of persons whose consent is required under Section 7 of the Securities Act or under the rules and regulations of the Commission thereunder.

Very truly yours,

/s/ Cahill Gordon & Reindel LLP