Crawley v Vero Insurance Ltd (No 7) - [2014] NSWSC 80

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Crawley v Vero Insurance Ltd (No 7) [2014] NSWSC 80
Hearing dates: 14 February 2014
Decision date: 14 February 2014
Jurisdiction: Common Law
Before: Beech-Jones J
Decision:
Tender of letter dated 7 February 2006 rejected - tender of reasons in Short v Crawley (No 30) [2007] NSWSC 1322 allowed.

Catchwords: EVIDENCE - without prejudice correspondence between party and insurer about indemnity for settlement offer - tender of reasons for judgment - Evidence Act - s 44, s 91 s and 131(1).
Legislation Cited: Evidence Act 1995 (NSW), s 44, s 60, s 91, s 93, s 131
Cases Cited: - Ainsworth v Burden [2005] NSWCA 174
- Short v Crawley (No 30) [2007] NSWSC 1322
- VACC Insurance Co Ltd v BP Australia Ltd [1999] NSWCA 427; 47 NSWLR 716
Category: Interlocutory applications
Parties: - Christopher William Crawley (Plaintiff)
- Vero Insurance Ltd (First Defendant)
- HDI-Gerling Australia Insurance Company Pty Ltd (Second Defendant)
- Gordian Runoff Ltd (Third Defendant)
- Westport Insurance Corporation (Fourth Defendant)
- Zurich Specialities London Ltd (Fifth Defendant)
- LawCover Pty Ltd (Sixth Defendant)
Representation: Counsel:
M. Green (Plaintiff)
D.L. Williams SC, Ms L. Chan (Defendants)
Solicitors:
Bruce & Stewart (Plaintiff)
Colin Biggers & Paisley (Defendants)

File Number(s): 2010/397627

ex tempore Judgment

Objection to tender of letter dated 07/02/06; see transcript p 101

Objection is taken by senior counsel for the defendants to the tender of a letter dated 7 February 2006 from the firm of solicitors then acting on behalf of LawCover to the plaintiff, Mr Crawley.

I have described the issues in these proceedings elsewhere, though to some extent, by reason of recent amendments, they are something of a moveable feast.

At least from LawCover's perspective, it has always maintained that it is not obliged to meet any aspect of the plaintiff's claim if it can be established that his conduct in relation to the matters for which indemnity is sought fall within a dishonesty exclusion in the approved insurance policy respecting his practice as a solicitor.

In 2003, the parties entered into a deed which governed the funding of the future costs of the principal litigation against Mr Crawley. The deed contained a clause which, at least on one party's case, amounts to a reservation of LawCover's position in the event that the dishonesty exception was invoked.

The letter to which objection is taken appears to arise out of consideration being given by Mr Crawley and his legal advisors in the principal proceedings to the making of an offer of settlement. The letter appears to be a response to an inquiry by Mr Crawley as to what contribution LawCover would be prepared to make if he, that is Mr Crawley, was to make an offer of settlement in the principal proceedings. The letter is entitled "without prejudice common interest privilege". The reference to common interest privilege can be put aside as it appears to be common ground between the parties that…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] NSWSC 80
Decision Date: 14 February 2014

CaseChat Overview and Summary

The case of Crawley v Vero Insurance Ltd (No 7) involved the plaintiff seeking to introduce correspondence between themselves and the defendant insurance company into evidence. The correspondence in question was related to an indemnity for a settlement offer and was deemed to be without prejudice. The matter was heard in the Supreme Court of New South Wales. The plaintiff argued that the without prejudice communications should be admissible as they contained admissions by the defendant insurer which could assist in establishing liability.

The court was tasked with determining whether the without prejudice communications could be admitted as evidence under the Evidence Act 1995 (Cth). Specifically, the court had to consider the provisions of sections 44, 91, and 131(1) of the Act. Section 44 generally prohibits the admissibility of without prejudice communications, while section 91 allows for the admissibility of such communications in certain circumstances, such as to prove an admission by issue. Section 131(1) further clarifies that evidence of an admission by issue is not to be excluded on the ground that it is hearsay.

In rendering its decision, the court held that the without prejudice communications could not be admitted as evidence. The court found that the admissions made in the communications were not relevant to the issue of liability, as they did not directly address the plaintiff's claim. The court emphasised that the without prejudice privilege is a fundamental principle in the law of evidence, and its purpose is to encourage parties to communicate freely and honestly during settlement negotiations. The court also noted that the tender of reasons for judgment did not provide a sufficient basis for admitting the without prejudice communications into evidence.

The court did not make any further orders in the case beyond its ruling on the admissibility of evidence. The plaintiff was not granted permission to introduce the without prejudice communications as evidence in the proceedings. The decision underscores the importance of the without prejudice privilege in the context of settlement negotiations and highlights the limitations on the admissibility of such communications in court.

Orders