Flanagan v Bernasconi - [2023] NSWCA 150

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Flanagan v Bernasconi [2023] NSWCA 150
Hearing dates: 18 October 2022
Date of orders: 4 July 2023
Decision date: 04 July 2023
Before: White JA at [1];
Mitchelmore JA at [2];
Simpson AJA at [76]
Decision:
(1)   The appeal is dismissed.
(2)   The cross-appeal is dismissed.
(3)   The appellant/cross-respondent is to pay the cross-appellants/ respondents’ costs of the appeal and cross-appeal.

Catchwords:
NEGLIGENCE – professional negligence – where insurance broker breached duty of care owed to the appellant to exercise reasonable care and skill in advising on and obtaining insurance cover – where appellant took out new policy based on insurance broker’s advice which, unlike previous policy, contained certain exclusion clauses – where claim made by appellant in relation to accidental damage to a pool and pool building was denied on the basis of those exclusion clauses – whether insurance policy which appellant would have obtained but for the breach of duty would have responded to a claim for damage to pool and pool building – whether primary judge erred in relation to the onus of proof – whether primary judge erred in finding the appellant would have taken out insurance cover which did not contain the relevant exclusion clauses – whether primary judge erred by failing to find that it had not been proven that an alternative insurer would have covered the appellants’ claim

Legislation Cited:
Motor Accidents Act 1988 (NSW), s 3

Cases Cited:
Australian Aviation Underwriting Pty Ltd v Henry (1988) 12 NSWLR 121
Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7
HDI Global Specialty SE v Wonkana No 3 Pty Ltd (2020) 104 NSWLR 634; [2020] NSWCA 296
Fraser v B N Furman (Productions) Ltd [1967] 3 All ER 57
Legal & General Insurance Australia Ltd v Eather (1986) 6 NSWLR 390
Toll (FCGT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165; [2004] HCA 52
Topfelt Pty Ltd v State Bank of New South Wales Ltd (1993) 47 FCR 226
Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603; [1998] HCA 38
Vero Insurance Ltd v Power Technologies Pty Ltd [2007] NSWCA 226
Wallaby Grip Ltd v QBE Insurance (Australia) Ltd (2010) 240 CLR 444; [2010] HCA 9
Zurich Australian Insurance Limited v CSR Limited (2001) 52 NSWLR 193; [2001] NSWCA 261

Category: Principal judgment
Parties: Sue Flanagan (Appellant/Cross-Respondent)
Robert John Bernasconi (First Respondent/First Cross-Appellant)
Nadic Insurance Brokers Pty Ltd (Second Respondent/Second Cross-Appellant)
Representation: Counsel:
J Sleight (Appellant/Cross-Respondent)
M Elliott SC (Respondents/Cross-Appellants)
Solicitors:
Neville Hourn + Borg Legal (Appellant/Cross-Respondent)
Hall & Wilcox (Respondents/Cross-Appellants)

File Number(s): 2022/00123736
Publication restriction: Nil
Decision under appeal

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Common Law

Citation:

[2022] NSWSC 381

Date of Decision:

04 April 2022

Before:

Schmidt AJ

File Number(s):

2019/66093

HEADNOTE

[This headnote is not to be read as part of the judgment]

The appellant, Dr…

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.

Continue reading Flanagan v Bernasconi

Details

AGLC: Flanagan v Bernasconi [2023] NSWCA 150
Case: [2023] NSWCA 150
Decision Date: 04 July 2023

CaseChat Overview and Summary

The appeal concerned a claim for professional negligence against an insurance broker. The appellant alleged that the broker breached their duty of care by advising on and obtaining an insurance policy that contained exclusion clauses, unlike the appellant's previous policy. Consequently, a claim for accidental damage to a pool and its building was denied due to these exclusions. The central dispute revolved around whether the appellant would have secured alternative insurance cover that would have responded to the claim, had the broker not breached their duty.

The court was required to determine several key legal issues. These included whether the insurance policy the appellant would have obtained, but for the broker's breach, would have covered the damage to the pool and pool building. The court also considered whether the primary judge erred in relation to the onus of proof, specifically concerning the question of whether an alternative insurer would have provided cover without the exclusion clauses. Furthermore, the court examined whether the primary judge erred in finding that the appellant would have taken out insurance cover that did not contain the relevant exclusion clauses.

The court's reasoning focused on the appellant's burden to prove, on the balance of probabilities, that they suffered loss as a result of the broker's negligence. This involved demonstrating that an alternative policy, free from the exclusionary clauses, would have been available and that such a policy would have covered the specific damage sustained. The court found that the appellant had not discharged this onus. The primary judge's findings were upheld, concluding that it had not been proven that an alternative insurer would have covered the appellant's claim.

The appeal and cross-appeal were both dismissed. The appellant was ordered to pay the costs of the appeal and cross-appeal.

Orders

Orders of the court

(1) The appeal is dismissed.

(2) The cross-appeal is dismissed.

(3) The appellant/cross-respondent is to pay the cross-appellants/ respondents’ costs of the appeal and cross-appeal.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Medium Neutral Citation:	Flanagan v Bernasconi [2023] NSWCA 150
Hearing dates:	18 October 2022
Date of orders:	4 July 2023
Decision date:	04 July 2023
Before:	White JA at [1]; Mitchelmore JA at [2]; Simpson AJA at [76]
Decision:	(1) The appeal is dismissed. (2) The cross-appeal is dismissed. (3) The appellant/cross-respondent is to pay the cross-appellants/ respondents’ costs of the appeal and cross-appeal.
Catchwords:	NEGLIGENCE – professional negligence – where insurance broker breached duty of care owed to the appellant to exercise reasonable care and skill in advising on and obtaining insurance cover – where appellant took out new policy based on insurance broker’s advice which, unlike previous policy, contained certain exclusion clauses – where claim made by appellant in relation to accidental damage to a pool and pool building was denied on the basis of those exclusion clauses – whether insurance policy which appellant would have obtained but for the breach of duty would have responded to a claim for damage to pool and pool building – whether primary judge erred in relation to the onus of proof – whether primary judge erred in finding the appellant would have taken out insurance cover which did not contain the relevant exclusion clauses – whether primary judge erred by failing to find that it had not been proven that an alternative insurer would have covered the appellants’ claim
Legislation Cited:	Motor Accidents Act 1988 (NSW), s 3
Cases Cited:	Australian Aviation Underwriting Pty Ltd v Henry (1988) 12 NSWLR 121 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7 HDI Global Specialty SE v Wonkana No 3 Pty Ltd (2020) 104 NSWLR 634; [2020] NSWCA 296 Fraser v B N Furman (Productions) Ltd [1967] 3 All ER 57 Legal & General Insurance Australia Ltd v Eather (1986) 6 NSWLR 390 Toll (FCGT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165; [2004] HCA 52 Topfelt Pty Ltd v State Bank of New South Wales Ltd (1993) 47 FCR 226 Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603; [1998] HCA 38 Vero Insurance Ltd v Power Technologies Pty Ltd [2007] NSWCA 226 Wallaby Grip Ltd v QBE Insurance (Australia) Ltd (2010) 240 CLR 444; [2010] HCA 9 Zurich Australian Insurance Limited v CSR Limited (2001) 52 NSWLR 193; [2001] NSWCA 261
Category:	Principal judgment
Parties:	Sue Flanagan (Appellant/Cross-Respondent) Robert John Bernasconi (First Respondent/First Cross-Appellant) Nadic Insurance Brokers Pty Ltd (Second Respondent/Second Cross-Appellant)
Representation:	Counsel: J Sleight (Appellant/Cross-Respondent) M Elliott SC (Respondents/Cross-Appellants) Solicitors: Neville Hourn + Borg Legal (Appellant/Cross-Respondent) Hall & Wilcox (Respondents/Cross-Appellants)
File Number(s):	2022/00123736
Publication restriction:	Nil
Decision under appeal	Court or tribunal: Supreme Court of New South Wales Jurisdiction: Common Law Citation: [2022] NSWSC 381 Date of Decision: 04 April 2022 Before: Schmidt AJ File Number(s): 2019/66093