Liberty Mutual Insurance Company Australian Branch trading as Liberty Specialty Markets v Icon Co (NSW) Pty Ltd (No 2)

[2021] FCAFC 131

FEDERAL COURT OF AUSTRALIA

Liberty Mutual Insurance Company Australian Branch trading as Liberty Specialty Markets v Icon Co (NSW) Pty Ltd (No 2) [2021] FCAFC 131  

Appeal from:	Icon Co (NSW) Pty Ltd v Liberty Mutual Insurance Company Australian Branch trading as Liberty Specialty Markets [2020] FCA 1493
File numbers:	VID 732 of 2020 VID 737 of 2020
Judgment of:	ALLSOP CJ, BESANKO AND MIDDLETON JJ
Date of judgment:	29 July 2021
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Commercial Contracts, Banking, Finance and Insurance
Number of paragraphs:	7
Date of last submissions:	27 July 2021
Date of hearing:	10–11 May 2021
Counsel for the Appellant:	Mr C Caleo QC with Ms G Crafti
Solicitor for the Appellant:	Lander & Rogers Lawyers
Counsel for the First Respondent:	Mr J Slattery QC with Ms J Collins
Solicitor for the First Respondent:	K & L Gates
Counsel for the Second Respondent:	Mr S Donaldson SC with Ms N Oreb
Solicitor for the Second Respondent:	Barry Nilsson Lawyers

ORDERS

VID 732 of 2020

BETWEEN:

LIBERTY MUTUAL INSURANCE COMPANY AUSTRALIAN BRANCH TRADING AS LIBERTY SPECIALTY MARKETS (ABN 61 086 083 605)

Appellant

AND:

ICON CO (NSW) PTY LTD (ACN 604 790 409)

First Respondent

QBE UNDERWRITING LIMITED AS MANAGING AGENTS FOR UNDERWRITING MEMBERS OF LLOYD'S SYNDICATES 386 AND 299

Second Respondent

AND BETWEEN:

ICON CO (NSW) PTY LTD (ACN 604 790 409)

Cross-Appellant

AND:

LIBERTY MUTUAL INSURANCE COMPANY AUSTRALIAN BRANCH (ABN 61 086 083 605)

First Cross-Respondent

QBE UNDERWRITING LIMITED AS MANAGING AGENTS FOR UNDERWRITING MEMBERS OF LLOYD'S SYNDICATES 386 AND 299
Second Cross-Respondent

ORDER MADE BY:	ALLSOP CJ, BESANKO AND MIDDLETON JJ
DATE OF ORDER:	29 JULY 2021

THE COURT ORDERS THAT:

(1)The cross-appeal be allowed.

(2)The appeal be dismissed.

(3)Orders 1 and 2 and declaration 6 made by the Court made on 26 October 2020 in VID781/2019 be set aside and in lieu thereof:

(a)Declare that in November 2015 the applicant (Icon) invoked condition 15 of the Third Party Liability Policy numbered 438396 issued by the first respondent (Liberty), and Icon thereby obtained insurance cover from Liberty in terms of said condition 15 for the Opal Tower Contract and Project in accordance with the terms and conditions of said policy up to and including the end of any testing and/or defects liability and/or maintenance periods under the contracts which Icon entered into and under which Icon performed work in connection with the Opal Tower Contract and Project, and thereby up to and including at least 24 and 27 December 2018.

(b)Declare that the cracking observed on 24 and 27 December 2018 at the “Opal Tower” development at 98 Bennelong Parkway, Sydney reflected or was the result of an Occurrence in connection with the Insured’s, that is Icon’s, Business within the meaning of said policy numbered 438396 that occurred within the period of cover of the said 2015/2016 policy.

(4)Liberty pay Icon’s costs of the appeal and cross-appeal as agreed or assessed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ORDERS

VID 737 of 2020

BETWEEN:

QBE UNDERWRITING LIMITED AS MANAGING AGENTS FOR UNDERWRITING MEMBERS OF LLOYD'S SYNDICATES 386 AND 299

Appellant

AND:

ICON CO (NSW) PTY LTD (ACN 604 790 409)

First Respondent

LIBERTY MUTUAL INSURANCE COMPANY AUSTRALIAN BRANCH TRADING AS LIBERTY SPECIALTY MARKETS (ABN 61 086 083 605)

Second Respondent

ORDER MADE BY:	ALLSOP CJ, BESANKO AND MIDDLETON JJ
DATE OF ORDER:	29 JULY 2021

THE COURT ORDERS THAT:

(1)The appeal be allowed.

(2)Declaration 8 made on 26 October 2020 in VID781/2019 be set aside by consent.

(3)Order 4 and declaration 7 made on 26 October 2020 in VID781/2019 be set aside and in lieu thereof it be ordered that:

(a)the third further amended originating application by the applicant (Icon) as against the second respondent (QBE) be dismissed; and

(b)Icon pay QBE’s costs of the proceeding to be agreed or assessed.  

(4)Icon pay QBE’s costs of the appeal as agreed or assessed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

1. On 20 July 2021, the Court delivered its reasons in respect of these two appeals:  Liberty Mutual Insurance Company Australian Branch trading as Liberty Specialty Markets v Icon Co (NSW) Pty Ltd [2021] FCAFC 126. The Court ordered that the parties within seven (7) days file any submissions as to the form of the orders set out at [351] of the reasons in respect of the Liberty appeal and [435] of the reasons in respect of the QBE appeal.

2. In respect of the Liberty appeal, the appellant submits that the Court ought not to have proposed order 4 at [351] in circumstances where it does not propose to set aside order 3 of the orders made in the primary proceedings on 26 October 2020 in VID781/2019. Order 3 states that “Liberty pay Icon’s costs of the proceeding as agreed or taxed”. The proposed order 4 states that “Liberty pay Icon’s costs of the proceeding as agreed or assessed”. The Court agrees that in circumstances where order 3 is not set aside, proposed order 4, which is in substantially identical terms, is unnecessary and should not be made.

3. Also in respect of the Liberty appeal, the first respondent submits that the date proposed in order 3(a) of the proposed orders at [351] ought to have been November 2015, rather than December 2015. The Court agrees with that submission.

4. The parties in the QBE appeal submit that they do not oppose the form of orders proposed by the Court at [435]. The Court however notes that orders 8 and 7 referred to in the proposed orders (2) and (3) were in fact declarations and should be referred to as such.

5. The Court will therefore make the following orders.

6. In respect of the Liberty appeal, it be ordered that:

   (1)The cross-appeal be allowed.

   (2)The appeal be dismissed.

   (3)Orders 1 and 2 and declaration 6 made by the Court made on 26 October 2020 in VID781/2019 be set aside and in lieu thereof:

   (a)Declare that in November 2015 the applicant (Icon) invoked condition 15 of the Third Party Liability Policy numbered 438396 issued by the first respondent (Liberty), and Icon thereby obtained insurance cover from Liberty in terms of said condition 15 for the Opal Tower Contract and Project in accordance with the terms and conditions of said policy up to and including the end of any testing and/or defects liability and/or maintenance periods under the contracts which Icon entered into and under which Icon performed work in connection with the Opal Tower Contract and Project, and thereby up to and including at least 24 and 27 December 2018.

   (b)Declare that the cracking observed on 24 and 27 December 2018 at the “Opal Tower” development at 98 Bennelong Parkway, Sydney reflected or was the result of an Occurrence in connection with the Insured’s, that is Icon’s, Business within the meaning of said policy numbered 438396 that occurred within the period of cover of the said 2015/2016 policy.

   (4)Liberty pay Icon’s costs of the appeal and cross-appeal as agreed or assessed.

7. In respect of the QBE appeal, it be ordered that:

   (1)The appeal be allowed.

   (2)Declaration 8 made on 26 October 2020 in VID781/2019 be set aside by consent.

   (3)Order 4 and declaration 7 made on 26 October 2020 in VID781/2019 be set aside and in lieu thereof it be ordered that:

   (a)the third further amended originating application by the applicant (Icon) as against the second respondent (QBE) be dismissed; and

   (b)Icon pay QBE’s costs of the proceeding to be agreed or assessed.  

   (4)Icon pay QBE’s costs of the appeal as agreed or assessed.

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Chief Justice Allsop and Justices Besanko and Middleton.

Associate:

Dated:       29 July 2021