Horsell International Pty Ltd v Divetwo Pty Ltd

Horsell International Pty Ltd appealed to the Court of Appeal of New South Wales against a decision concerning an insurance policy. The dispute involved whether the first and second respondents, Divetwo Pty Ltd and Mr Todd respectively, were entitled to an indemnity from the third respondent, Liberty Mutual Insurance Company, under a policy issued by Liberty. The core of the dispute centred on an injury and damage that occurred during a recreational boat trip, and whether this event fell within the scope of the policy's coverage for claims arising "in connection with the Insured's Business".

The Court of Appeal was required to determine two primary legal issues. Firstly, it had to construe the insuring clause of the policy to ascertain whether the recreational boat trip was sufficiently connected to Divetwo's business to trigger indemnity. Secondly, the Court needed to consider an exclusion clause within the policy relating to "criminal act or omission", specifically whether Mr Todd's conduct during the boat trip constituted a criminal act or omission for the purposes of that exclusion, and whether intent was a necessary element of such an act or omission. The Court also considered a claim of negligence against an insurance broker for failing to advise of deficiencies in the policy.

The Court of Appeal dismissed the appeal and cross-appeal. It reasoned that the recreational boat trip was not sufficiently connected to the insured's business to fall within the insuring clause. Furthermore, the Court found that Mr Todd's conduct, while potentially negligent, did not amount to a "criminal act or omission" as contemplated by the exclusion clause, as it did not involve the necessary criminal intent. The Court confirmed leave for Horsell to amend its notice of appeal to include a specific ground. Consequently, Horsell was ordered to pay the costs of the respondents for the appeal and cross-appeal.