Cic Workers Compensation (NSW) Ltd v Kellogg (Australia) Pty Ltd

CIC Workers Compensation (NSW) Ltd (CIC) appealed to the New South Wales Court of Appeal against a decision of the Supreme Court of New South Wales. The dispute concerned the interpretation of a workers compensation policy and whether it provided indemnity to Kellogg (Australia) Pty Ltd (Kellogg) for a particular claim.

The primary legal issue before the Court of Appeal was whether the policy, specifically clause 10(1)(b) of the Second Schedule to the Workers Compensation Act 1987 (NSW), excluded indemnity for claims made by employees who were also directors of the employer company. The court had to determine if the wording of the policy, in conjunction with the relevant statutory provisions, operated to exclude coverage for Mr. G. A. Kellogg, who was both a director and an employee of Kellogg.

The Court of Appeal, in allowing the appeal, reasoned that the exclusion in clause 10(1)(b) was intended to apply to persons who were *only* directors and not employees. The court found that Mr. Kellogg was an employee within the meaning of the Act and the policy, and his status as a director did not, in itself, remove him from the scope of the indemnity. The court applied principles of statutory interpretation, emphasizing that exclusions in insurance policies must be clear and unambiguous, and that the policy should be construed in a way that gives effect to its primary purpose of providing indemnity for employees.

The Court of Appeal ordered that the appeal be upheld, setting aside the order of the Supreme Court and remitting the matter to the Supreme Court for determination of the quantum of indemnity.