Murray Goulburn Co-operative Co. Limited v AIG Australia Limited

Murray Goulburn Co-operative Co. Limited and related entities (the "applicants") sought a declaration from the Court that they were entitled to indemnity from AIG Australia Limited (the "respondent") in relation to settlement sums paid to settle two class actions. The applicants sought indemnity under an indemnity policy for liability concerning securities class action exposure issued by the respondent (the "ABC policy"). The applicants alleged contraventions of continuous disclosure provisions and sought indemnification under the policy.

The legal issues for the Court to determine included the meaning of "securities" and "securities claim" in the context of the ABC policy, the relevance of the meaning of "securities" under section 92 of the Corporations Act 2001 (Cth), the scope of endorsements and exclusions in the policy, and whether the class action claims arose out of the product disclosure statement concerning the MG Unit Trust. The Court also considered whether the class action claims related to the acquisition of units in the MG Unit Trust on the secondary market rather than the primary market, and the causal nexus of the class action claims to the product disclosure statement.

The Court held that the class action claims satisfied the definition of "Securities Claim" in the ABC policy. The Court also held that endorsements 7, 8, 10 and 11 of the ABC policy did not apply to the subset of class action claims that related to the purchase in the secondary market of units in the MGUT between 3 July 2015 (alternatively 31 August 2015) and 26 April 2016. Finally, the Court held that the "Professional Financial Services" general policy exclusion did not apply to the subset of class action claims referred to in the declaration.

The Court ordered that the respondent pay the applicants' costs of and incidental to the proceeding, and granted liberty to apply.