K & M Prodanovski Pty Ltd v Calliden Insurance Ltd

K & M Prodanovski Pty Ltd (the appellant) appealed to the Court of Appeal of New South Wales against a decision concerning a motor vehicle insurance claim. The dispute arose after the appellant's vehicle sustained substantial damage in an accident, and the insurer, Calliden Insurance Ltd (the respondent), was alleged to have failed to make a timely election regarding the settlement of the claim. The core of the disagreement centred on whether the vehicle had sustained "non-repairable damage" and the consequences of the insurer's inaction.

The Court of Appeal was required to determine two primary legal issues. Firstly, whether the damaged vehicle had, in fact, sustained "non-repairable damage" as defined by the relevant legislation, specifically section 16B of the *Road Transport (Vehicle Registration) Act 1997* (NSW) and regulation 83C(1)(c) of the *Road Transport (Vehicle Registration) Regulation 2007* (NSW). Secondly, the court had to consider whether, in the absence of a timely election by the insurer to repair the vehicle, pay the costs of repair, or make a cash settlement, the insurer was liable to pay the agreed value of the vehicle to the insured.

The Court of Appeal dismissed the appeal, upholding the primary judge's decision. The court reasoned that the evidence did not establish that the vehicle had sustained "non-repairable damage" under the statutory provisions. Furthermore, the court found that the insurer had not failed to make an election within a reasonable time. Consequently, the insurer was not liable to pay the agreed value of the vehicle. The appellant was ordered to pay the respondent's costs of the appeal.