Automobile Fire and General Insurance Company of Australia Limited v Davey

The parties to this appeal were The Automobile Fire and General Insurance Company of Australia Limited (the appellant insurer) and A. V. Davey (the respondent insured). The dispute concerned the interpretation of a comprehensive automobile insurance policy issued by the appellant to the respondent, a married woman. The policy contained a clause stipulating that the insurer would pay compensation if "the insured or his wife" sustained bodily injury in specified circumstances. The respondent's husband was killed in an accident covered by the policy, and she sought to recover under the clause for his death. The matter was heard by the High Court of Australia on appeal from the Supreme Court of Victoria.

The central legal issue before the High Court was whether the phrase "the insured or his wife" in the insurance policy could be interpreted to include "the insured or her husband" when the insured was a married woman. This required the Court to consider the plain meaning of the words used, the potential application of the *contra proferentem* rule, and the effect of section 61(d) of the *Property Law Act 1928* (Vic.), which states that the masculine includes the feminine and vice versa in instruments.

The High Court, in allowing the appeal, reasoned that while pronouns like "he" and "his" in the policy could be construed to refer to the insured regardless of gender to give efficacy to the contract, the phrase "the insured or his wife" was not ambiguous. The Court held that "wife" denotes a specific relationship and is not merely a word of gender. Therefore, section 61(d) of the *Property Law Act 1928* did not operate to equate "wife" with "husband" in this context, as the words imported more than just gender. The judges concluded that to interpret "wife" as "husband" would be to alter the plain meaning of the words and impose a different risk on the insurer than that which was clearly expressed in the policy. The Court found no sufficient indication within the policy itself to suggest an intention to cover the risk of a husband's death.

Consequently, the High Court reversed the decision of the Supreme Court of Victoria. It declared that, on a proper construction of the policy, the insurer was not liable to the insured for the death of her husband. The Court ordered that the respondent insured pay the costs of the appeal and the costs incurred in the Supreme Court.