AMP Financial Planning Pty Ltd v CGU Insurance Ltd (No 2)

The case of AMP Financial Planning Pty Ltd v CGU Insurance Ltd (No 2) was heard by the Federal Court of Australia, focusing on the issue of whether a declaration should be made regarding CGU Insurance's liability to indemnify AMP Financial Planning for unpaid claims, as well as the costs associated with the matter. The claims in question totaled $3,067,550 and had not been paid to investors. AMPFP had deferred making a decision on whether to pay these claims.

The central legal issue before the court was whether a declaration should be made in respect of CGU’s liability to indemnify AMPFP for these unpaid claims, given that the liability of AMPFP to the investors had not been established. AMPFP argued that a declaration should be made based on the rejection of CGU's arguments regarding the terms of the insurance policies. However, the court considered authorities suggesting that declarations regarding an insurer’s liability are usually not made unless the insured’s liability to the third party has been established. The court held that the exceptional circumstances necessary to make such a declaration were not present in this case.

The court dismissed the application for a declaration and ordered AMPFP to pay 90% of CGU’s costs, including reserved costs. The court's reasoning was based on the principle that the liability of AMPFP to the investors had not been established, and thus, a declaration regarding CGU’s liability was not appropriate. The court emphasized that such declarations are only suitable in exceptional circumstances, which were not present here.