MURRAY'S Transport NSW P/L v CGU Insurance Ltd - [2012] SADC 172

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
MURRAY'S TRANSPORT NSW P/L v CGU INSURANCE LTD
[2012] SADC 172
Judgment of His Honour Judge Chivell
7 December 2012
INSURANCE - CLAIMS GENERALLY - CLAIM BY THIRD PARTY WHERE INSURED ABSENT OR DEAD
Head-on collision between B-double and Jaguar motor vehicle – driver of the Jaguar killed. Exemption clause in defendant’s comprehensive insurance policy over the Jaguar with respect to deliberately caused damage. Plaintiff claim pursuant to s 51 Insurance Contracts Act 1984 (Cth) for cost of repairs to prime mover and trailer and associated expenses - whether Jaguar driver caused the damage intentionally by deliberately driving into the path of the B-double in order to commit suicide. Defendant’s onus of proof satisfied – plaintiff’s claim dismissed.
Insurance Contracts Act 1984 (Cth) s 51, referred to.
Rail Corporation NSW v Vero Insurance Ltd [2012] NSWSC 632; SGIC v Lane (1997) 68 SASR 257; Fire and All Risks Insurance Co Ltd v Powell [1966] VR 513; Clayton v Mutual Community General Insurance Pty Ltd (1995) 64 SASR 353; Beresford v Royal Insurance Co Ltd [1938] AC 586; Clark v NZI Life Limited [1991] 2 QR 11; Briginshaw v Briginshaw (1938) 60 CLR 336; American Home Assurance Company v King [2001] NSWCA 201; SA Health Commission v McArdle South Australian Supreme Court, unreported, Judgment No. S6685, 26.5.98; Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1; Napier v Hunter [1993] AC 713, considered.

MURRAY'S TRANSPORT NSW P/L v CGU INSURANCE LTD
[2012] SADC 172
Introduction

This is an action pursuant to s 51 of the Insurance Contracts Act 1984 (Cth). The plaintiff was the owner of a Western Star prime mover and an A‑trailer, which were part of a combination known as a ‘B-double’.
On 16 June 2008 at about 3.04 p.m., the B-double was being driven by Mr Brett Murray in an easterly direction along the Dukes Highway near Yumali, South Australia. At the same time, a Jaguar motor vehicle was being driven by Mr Allan McFarlane in a westerly direction on the Dukes Highway. The two vehicles collided head-on, Mr McFarlane suffered fatal injuries, and both vehicles were extensively damaged. Mr Murray was not injured.
The defendant was the comprehensive motor vehicle insurer of the Jaguar. The plaintiff claims a total of $155,132.53, being the cost of repairs to the prime mover and trailer, and associated expenses.
The Legislation
Section 51(1) of the Insurance Contracts Act provides:
51 Right of third party to recover against insurer
(1) Where:
(a) the insured under a contract of liability insurance is liable in damages to a person (in this section called the third party);
(b) the insured has died or cannot, after reasonable enquiry, be found; and
(c) the contract provides insurance cover in respect of the liability;
the third party may recover from the insurer an amount equal to the insurer’s liability under the contract in respect of the insured’s liability in damages.
There is no dispute that:
·Mr McFarlane held a policy of comprehensive insurance with the defendant over the vehicle;
·Mr McFarlane is deceased.
The requirements of s 51(1)(b) and (c) have therefore been satisfied. The question to be decided, then, is whether the circumstances were such that a liability in damages to the plaintiff arose under the contract of insurance.
The Contract of Insurance
The contract of insurance is Exhibit P19. The liability of the insurance company to indemnify the driver of the Jaguar is set out in the document (page 12 of the Exhibit Book – ‘EB 12’):
We will cover you, a nominated driver, an authorised driver, or passengers of your vehicle, for legal liability if your vehicle or a substitute vehicle is involved in an incident that causes loss or damage to someone else’s property, or death or bodily injury to other people.
An ‘incident’ is defined, but there is no doubt that the collision in question was an incident within the meaning of the policy.
There are certain exclusions to the policy ‘cover’, included in which is the following:
We will NOT cover any loss, damage or liability … deliberately caused by you, a member of your family, a nominated driver, or an authorised driver
(EB 15)
Mr McFarlane was a ‘nominated driver’ (EB 36). The defendant’s case was that he caused the plaintiff’s damage intentionally.
Onus of Proof
Clearly, the plaintiff has the onus of proving the defendant’s liability pursuant to the policy of insurance for the plaintiff’s losses (Rail Corporation NSW v Vero Insurance Ltd[1]).
[1] [2012] NSWSC 632 at [308]
Counsel for the defendant submitted that the plaintiff had confined its pleading to an allegation that the defendant is liable in negligence, and that it is confined to asserting liability on that ground alone.
In paragraph 6 of the Second Statement of Claim, the plaintiff pleads that the collision was caused by (Mr McFarlane’s) negligence, and then alleges particulars of the faulty driving.
However, the prayer for relief in Part 2 of the Statement of Claim is as follows:
The remedies sought are:-
1. A declaration that the Defendant is liable to the Plaintiff pursuant to section 57(1) of the Insurance Contracts Act 1984 (Cth);
2. Damages equal to the Defendant’s liability under the contract of liability insurance with Mr McFarlane in accordance with section 51(1) of the Insurance Contracts Act 1984 (Cth);
3. Interest; and
4. Costs.
Section 57(1) of the Insurance Contracts Act makes the insurer liable for interest on the amount payable. This section was not referred to during the trial. I assume that this was a typographical error, and that s 51(1) was intended.
It is clear that the plaintiff’s claim is based on a statutory liability arising from s 51(1) of the Insurance Contracts Act. The policy of insurance creates a liability on the defendant to indemnify the insured for any legal liability incurred if the insured vehicle is involved in an ‘incident that causes loss or damage’.
The real issue in this trial is the liability of the defendant pursuant to the contract of insurance, and whether liability is excluded because the actions of Mr McFarlane causing the damage were deliberate.
Rail Corporation was a case involving a collision between a car and a train at a level crossing. The plaintiff brought a claim pursuant to s 51(1) against the insurer of the car on the basis that it had contracted to indemnify the deceased driver against legal liability to pay damage to third parties, in circumstances where:
… as a result of an accident, a person is legally responsible to pay compensation for (third party loss)
([203])
After analysis of the meaning of the word ‘accident’, Garling J ruled that it had a wide meaning which I consider has no relevant difference from the meaning of ‘incident’ here (see [310]). Indeed, ‘incident’ probably carries an even wider meaning. Garling J wrote, at [303]:
… Mrs Jeffries (the insured) was liable in damages to RailCorp for the collision because she was the cause of it. She was the cause of it because her obligation as a car driver was to give way to the train at the level crossing. Whether or not the failure to give way to the train, and allow it to pass through the crossing undamaged, was as a consequence of her inadvertence or negligence, or else a deliberate act on her part, does not affect her liability in damages.
Similarly, it is common ground in this case that Mr McFarlane caused the collision because he drove his car on the incorrect side of the road.
The pleading of negligence in this case is therefore otiose and does not restrict the plaintiff’s claim to that ground alone.
Onus of Proof – The Exclusion
The defendant accepts that, if the plaintiff proves that the insured’s liability is covered by the insuring clause, it has the onus of proving, on the balance of probabilities, that the loss was caused deliberately, citing SGIC v Lane,[2] Fire and All Risks Insurance Co Ltd v Powell.[3]
[2] (1997) 68 SASR 257 at 260
[3] [1966] VR 513
Further, the defendant says that in order to establish that the damage was caused deliberately, it is not necessary that it be proven that Mr McFarlane intended to damage the B-double, or that he desired that result. In Clayton v Mutual Community General Insurance Pty Ltd,[4] at 354, King CJ quoted Lord Atkin in Beresford v Royal Insurance Co Ltd:[5]
The true rule is that where the actual loss for which indemnity is sought is deliberately contrived by the insured's wilful and deliberate act, he cannot recover under the policy, but that his negligence does not bring him within that concept.
King CJ observed, at 355:
What is excluded is not intentional damage but damage caused by a deliberate or intentional act.
[4] (1995) 64 SASR 353
[5] [1938] AC 586 at 595
I see no material distinction between the words ‘loss or damage caused by the deliberate or intentional acts committed by you’, contained in the policy in Clayton, and ‘damage … deliberately caused by you’, the words in the subject policy.
King CJ went on to say, at 356-7:
The parties should not be taken to have intended that unintended consequences of ordinary and proper use of the insured premises or ordinary and proper activities carried out on them would be excluded from the cover provided by the Policy.
I consider that the act contemplated by the phrase "deliberate and intentional act" is the act of causing the damage. There must be a deliberate or intentional causing of the damage to the insured premises.
Generally speaking, to say that a person deliberately or intentionally causes damage imports that that person desires to cause that damage. Intention in law, however, is not equated with desire. There is an intentional act of causing damage when a person who has no desire to cause the damage, deliberately does so because of a desire to achieve some collateral purpose. Neither is intention equated with recklessness. The act of causing damage is reckless in contra distinction to deliberate or intentional where the person realises the risk that damage will probably result but proceeds irrespective of that risk.
Although intention and recklessness are distinct states of mind and the latter is not within the policy exclusion, there is a point at which the risk of damage to the insured premises, as it exists and as it is realised by the insured to exist in consequence of the insured's actions is so high that the insured's state of mind, notwithstanding that the damage was not designed or planned by him, is indistinguishable from intention.
It is difficult to formulate a satisfactory test for the determining when unplanned and undesigned damage is to be regarded as intentional. In the American cases cited above the test adopted is that the insured believes that the damage is "substantially certain to result" from his actions and MacGillvray refers to embarking "upon a course of conduct in which there was a clear risk of the loss occurring". I do not think that the adoption of a precise formula would be useful. It must be a question for the tribunal of fact whether the risk, as realised by the insured, of the unplanned and undesigned damage was so high that his state of mind should be equated with intention because it amounted to imposing on the insurer a risk which it could not reasonably be thought to have intended to assume.
In my opinion, if the defendant proves to the requisite degree that Mr McFarlane deliberately drove his vehicle into the path of the B-double with the intention of suicide, then the appropriate conclusion is that he intentionally caused the damage to the B-double, in the sense that the act causing the damage, namely the driving, was intentional. In any event, the risk of damage to the B-double was so high that Mr McFarlane’s state of mind, notwithstanding that the damage was not designed or planned by him, is indistinguishable from intention.
Having said that the burden of proof is on the balance of probabilities, the question arises as to the degree of satisfaction required. Thomas J said, in Clark v NZI Life Limited:[6]
However the question arises whether such a finding should be made upon a mere balance of probability or whether some greater degree of satisfaction should be required along the lines recognised as appropriate in Briginshaw v. Briginshaw (1938) 60 C.L.R. 336. In that case Dixon J. observed that at common law, except upon criminal issues, whilst it is enough “that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal” there are different degrees of reasonable satisfaction. His Honour went on to observe:
“But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question of whether the issue has been proved to the reasonable satisfaction of the tribunal.” (at 362)
Suicide is no longer a crime. As an offence it was removed from the Code in 1979. Aiding or procuring it remains an offence, but good reason can be seen why the criminal law retains an interest in activity of that kind. In 1945 the Commonwealth legislated against the so called public policy of Beresford’s case [1938] A.C. 586 which precluded recovery under insurance polices when the death resulted from suicide. How grave then is the allegation that someone has made away with himself? It carries nothing like the odium that it formerly did, although it remains an unpleasant allegation not entirely free from stigma relating to the deceased and his family. At the same time the present litigation may be categorised simply as a claim for money.
Applying Dixon J.’s words above in the context of the present civil litigation I can say that the particular finding is not one to be made lightly, but neither is it one of such inherent unlikelihood or gravity as to bring it toward the top of the range of what is sometimes called the Briginshaw test. I do not think it profitable to try to be more precise about the necessary level of satisfaction.
[6] [1991] 2 QR 11 at 15-16
This passage was cited with approval in American Home Assurance Company v King.[7]
[7] [2001] NSWCA 201 at [10-11]
A Presumption against Suicide?
In King (supra, at [12]), the New South Wales Court of Appeal also approved the comments of Thomas J in Clark that ‘the language of presumption (and counter presumption) has largely been supplanted by the language of the proper inference to draw on the whole of the evidence’. Thomas J said, at 17:
It is true that where the evidence shows violent death without anything else, a Judge would as a matter of law hold that there was no evidence of suicide. This is all that is meant by the so called legal presumption … Once competing inferences are open there are no preconceptions or presumptions. The matter is at large. This has always been so.
In SA Health Commission v McArdle[8] at page 3, Doyle CJ said, in answer to a submission about the existence of a presumption:
But that is no more than a presumption of fact, based upon commonsense and common experience.
[8] South Australian Supreme Court, unreported, Judgment No. S6685, 26.5.98
In that case, Mrs McArdle died as a result of an overdose of medication. Doyle CJ acknowledged that misadventure was a possibility, but the weight of the evidence rendered it unlikely. In those circumstances, the appeal against a finding of suicide was rejected.
The onus then, is on the defendant to prove that the damage to the plaintiff’s truck and trailer was caused by the deliberate act of Mr McFarlane, on the balance of probabilities, taking into account the comments of Dixon J (as he then was) in Briginshaw, but as Thomas J said, not ‘at the top end of the range’.
In particular, there is no onus on the defendant to exclude other reasonable possibilities, such as those put forward by the plaintiff. I agree with Mr Burnett’s submission that the comments in the joint judgment of the High Court in Bradshaw v McEwans Pty Ltd[9] are apt:
The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence while the latter you need only circumstances raising a more probable inference in favour of what is alleged … if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then though the conclusion may fall short of certainty it is not to be regarded as a mere conjecture or surmise.
[9] (1951) 217 ALR 1 at 5
The Circumstances of the Collision
The collision between Mr Murray’s B-double and Mr McFarlane’s Jaguar occurred in the following circumstances:
·    it is agreed that the collision occurred at about 3.04 p.m. on 16 June 2008;
·    the approximate point of impact was 300 metres east of the crest of a small hill on the outskirts of Yumali, a very small town about 160 kilometres south‑east of Adelaide, on the Dukes Highway;
·    Mr Murray’s evidence about the weather was unclear. In cross-examination, he said it was a ‘clear, sunny day’ (T 59). He said it was ‘sort of clear, sunny’ to the police officer at 9.30 p.m. that night (ibid). Then, later in cross-examination, he agreed with counsel that it was not a bright sunny day (T 60). I had the distinct impression this lack of clarity was the result of Mr Murray’s suggestibility as a witness rather than a change in his evidence. I agree with the expert witness, Mr Axup, that the photographs suggest a bright sunny day (Exhibit P10, p 13), with clear, dark shadows being created by the vehicles;
·    the Dukes Highway at that point was a bitumen road, in good condition, which ran roughly east-west. The eastbound (Mr Murray’s) lane was about 3.7 metres wide, and the westbound (Mr McFarlane’s) lane was 3.5 metres wide;
·    there was no other vehicle on the road at any relevant time;
·    there was no evidence that the condition of either vehicle contributed in any way to what eventuated;
·    both drivers had a view of the road for about 400-500 metres at a point about 200 metres either side of the approximate point of impact (‘API’). Mr Murray had an easterly view of at least 500 metres from the crest of the small hill, and Mr McFarlane had a westerly view for a similar distance from a point 200 metres east of the API;
·    east of the API, there is a right-handed curve. With the curvature of the road, and the camber or cross-fall of the road, a vehicle driven west would tend to drift to the left unless the driver made a steering input to the right to maintain correct position in the lane (report of Mr Hall, the expert called by the defence, at Exhibit D11, p 6). The expert called by the plaintiff, Mr Axup, agreed in his report, Exhibit P10, p 4).
Mr Murray’s Evidence
Mr Murray gave evidence that:
·he was driving at about 90 kilometres per hour when he came over the crest on the edge of Yumali (T 40);
·the Jaguar was approaching his position at a ‘reasonable speed’ (T 53). The speedometer on the damaged Jaguar showed 100 kilometres per hour in Exhibit 10, photograph number 21. This supplies some evidence of the speed of the vehicle, although the reliability of this evidence was described by Mr Axup as ‘questionable’ (Exhibit P10, p 7);
·when he first saw the Jaguar, it was about 500 metres away and already over the broken white line in the middle of the road to the extent of about two-thirds (T 41);
·he took his foot off the accelerator when he first saw the Jaguar and ‘covered the brake’ (T 41);
·the Jaguar was travelling in a straight line, that is, it was maintaining its position two-thirds over the white line. The experts agree that this would have required steering inputs from the driver, first to get to that position and then to maintain that position (Axup T 79; Hall T 115);
·as the two vehicles approached each other, the Jaguar move further to the right so that it was wholly in the eastbound (incorrect) lane (T 55). He described this as a controlled rather than an ‘erratic’ movement (ibid). The clear inference from this and the expert evidence is that this movement would have required further steering input from the driver;
·when he realised that there might be a collision, about two to three seconds before impact, he applied the brakes heavily and swerved to the left (T 58);
·Mr McFarlane took no evasive action at all (T 41, 58). He neither braked, swerved nor made any other attempt to avoid the collision.

The experts agree that Mr McFarlane would have been able to see the B‑double for at least 8.5 seconds (Hall, Exhibit D11 [8.1]; Axup, Exhibit P10, p 12).
From the police photographs in Exhibit P1, the B-double appears to have ‘broadsided’ after the collision, with both trailers swinging to the left through almost 90 degrees. Remarkably, they did not tip over. Mr Murray attributed this to the fact that they were not loaded (T 43).
The Collision
The two vehicles collided head-on, but there was a large ‘offset’ between the two. Mr Axup described this as involving the right-hand side of the prime mover across to the right upright on the bull-bar, and the right-hand side of the Jaguar across to the right-hand edge of the radiator (Exhibit P10, p 10).
I agree with Mr Burnett’s submission that if not for Mr Murray swerving to the left, the two vehicles would have collided entirely head-on, and the damage to both vehicles would have been even more extensive. As it was, the right-hand side of the Jaguar was damaged to such a degree that Mr McFarlane suffered fatal injuries.
Mr McFarlane’s Financial Position
The defendant led evidence from Mr Gregg Johnson, an accountant and insolvency practitioner. Mr Johnson was, in July 2008, a partner in Ferrier Hodgson Chartered Accountants, and that firm had the task of administering Mr McFarlane’s estate, which was bankrupt. A number of documents which were related to the administration of the estate were tendered (Exhibits D31, D32, D35, D36).
That evidence clearly demonstrates that:
·Mr McFarlane’s estate was made bankrupt on 3 September 2008 (Exhibit D30);
·Mr McFarlane’s assets were two cars and a house property in Stirling, all of which were secured and fully borrowed against, about $1,000 in cash at the bank, and a small amount of furniture and personal effects;
·Mr McFarlane had no income (T 106);
·Mr McFarlane owed more than $20 million (Exhibit D31) to clients who had invested their funds with him and who had not received any return on their investment nor repayment of the principal invested;
·I agree with the submission of Mr Burnett that Mr McFarlane was operating a ‘Ponzi scheme’. Personal funds and investor funds were mingled. There was no evidence of funds being received from the redemption of investments. There was no evidence of deposits referable to investments being redeemed. Funds paid out to investors came from moneys transferred from the mortgage account and from other investor funds. It was highly likely that investments had not been made on behalf of clients for many years from funds deposited in the trust account.
Mr Hugh McPharlin, a very experienced forensic accountant, concluded (Exhibit D36, p 10):
4.1.1the McFarlanes Chartered Accountants Trust Account has been used by Mr McFarlane to receive money from and pay money to persons that are described as investors;
4.1.2investors’ funds have been mingled with the funds of other investors;
4.1.3the account did not operate as a trust account;
4.1.4the account was not audited;
4.1.5the account was regularly overdrawn;
4.1.6despite the volume of transactions, the balance of the account was only significantly in funds for short periods of time;
4.1.7there exists a pattern of deposits being promptly followed by a series of withdrawals;
4.1.8funds deposited by investors have been used to make payments to Mr McFarlane;
4.1.9the funds received from investors have not been separately invested in income earning deposit accounts;
4.1.01investors have been misled by Mr McFarlane concerning the nature and security of the investments made;
4.1.11funds are not currently held in the account to enable investors funds to be repaid;
4.1.12no funds were deposited in the United States; and
4.1.13Mr McFarlane was systematically using funds received from one investor to pay funds to other investors.
Mr Johnson said that some creditors had been trying to recover their investments prior to Mr McFarlane’s death (T 108).
I accept Mr Burnett’s submission that it is likely that Mr McFarlane’s conduct would have been revealed in the near future, and that he would face criminal charges. Mr Hoile, counsel for the plaintiff, accepted that in his address.
It is submitted for the defendant that his financial and legal position provided a motive for Mr McFarlane to commit suicide.
Analysis
For the reasons I have already expressed, I find that the plaintiff has established that the damage to the prime mover and trailer, and associated expenses, come within the scope of indemnity provided by the policy of insurance issued by the defendant.
The issue remaining is whether the ‘exclusion clause’ applies; namely, whether the defendant has proved that the damage was caused by the deliberate acts of Mr McFarlane, the insured.
The defendant points to the following factors in favour of its case that the actions of Mr McFarlane were deliberate:
·the position of the Jaguar on the road when Mr Murray first saw it, its continuing in that position for 50 to 100 metres, and its further movement into the incorrect lane all suggest that Mr McFarlane was deliberately steering the car in that fashion to achieve a collision;
·Mr McFarlane took no evasive action prior to the collision;
·had Mr Murray not taken evasive action, the collision would have been even more severe than it was;
·Mr McFarlane’s financial and legal position provided a motive to commit suicide.
The plaintiff argued that there were several other explanations for what happened which are no less compelling than the suggestion of suicide.
Mr Hoile argued that the evidence of Mr Axup was that, at the time of the collision, the sun was at an angle of only 18 degrees above the horizon, and at an angle of only one degree left of his line of travel (Exhibit P10, p 13). As to this, Mr Axup was relying on Google Maps for the line of travel – this was not accurately surveyed at the scene. Mr Axup also noted that it was a ‘bright sunny day’ if the police photographs were an indication. Mr Hoile argued that blinding from sun glare was a possible explanation for Mr McFarlane’s driving.
I note there is no evidence one way or the other about whether Mr McFarlane was attempting to shield his eyes with the car sun visor, or his hand, or otherwise.
Mr Burnett argued that this suggestion was purely speculative, and bore little weight without further evidential support. He argued that if the cause was sun glare, Mr McFarlane was still able to maintain appropriate steering input to negotiate the curve in the road and the camber of the road without apparent difficulty. If a driver was unable to see over such a long distance, he might be expected to slow down or stop, rather than proceed at about 100 kilometres per hour.
Mr Hoile also raised the possibility that Mr McFarlane might have suffered an acute heart event at the time of driving.
This submission is based on the post-mortem report of Dr Karen Heath (Exhibit P7). Dr Heath reported that there was no evidence of acute cerebrovascular accident (stroke). She also recorded, at page 2 of her report:
Other findings at autopsy included an enlarged heart with left ventricular hypertrophy and moderate coronary artery atherosclerosis, uncomplicated cholelithiasis and diabetic and hypertensive nephropathy. Whilst it is possible that the deceased may have experienced some acute cardiac event which may have precipitated the vehicle accident, this possibility cannot be confirmed or excluded by post-mortem examination.
(my emphasis)
There is no positive evidence that Mr McFarlane suffered some sort of heart attack. He was not seen slumped at the wheel, or clutching his chest, as sometimes occurs.
Mr Hoile argued that an acute heart event was a possibility, along with sun glare and suicide. These are all competing possibilities, he said, and there is nothing to say that one has any greater weight than either of the others.
Mr Hoile pointed out there was no positive evidence of suicide: no note, no evidence of suicidal ideation, no sudden swerve towards the B-double at the last moment, no removal of his seatbelt, no expert psychiatric opinion that he was suicidal. He pointed out that the aggressive tone in Mr McFarlane’s letter to his sister dated 13 June 2008 (Exhibit D37), only three days earlier, shows no pangs of conscience or stress at his financial and legal situation.
Mr Hoile argued that each of these factors diminishes the weight to be given to the inference of suicide from Mr McFarlane’s behaviour. He contrasted this case with the factual situation in Rail Corporation NSW v Vero Insurance Ltd (supra), where the psychiatric factors were more strongly suggestive of suicide than they are here. However, in that case the driving of the deceased was equivocal, and that is not the case here.
Contributory Negligence
This was only faintly suggested, and in view of Mr Murray’s evidence that he slowed as soon as he saw the Jaguar, and he braked as soon as he realised that a collision was imminent, I do not think that contributory negligence has been established. Mr Burnett submitted that it might only have been relevant had Mr McFarlane been blinded by sunlight. Having regard to the view I take, that issue does not arise.
Liquidation
Only days before the trial, it was discovered that the plaintiff went into liquidation in June 2012. There is no consent from the liquidator to proceed with the action (see s 495 of the Corporations Act 2001 (Cth)). In this case, the insurers of the plaintiff are exercising their right of subrogation under the comprehensive insurance policy covering the B-double, and so the action is not being taken as a result of a decision of the directors. In that sense they are merely ‘borrowing’ the name of the company (Napier v Hunter[10]). Mr Burnett took no point on this aspect.
[10] [1993] AC 713
I am aware of no principle which renders the action invalid by virtue of liquidation. If a corporate law or regulation has been breached, that may be a matter for another time. I will ignore the issue for the purpose of these proceedings.
Conclusion
Adopting the test proposed by Thomas J in Clark v NZI Life Limited (supra), that the onus of proving that the damage was caused deliberately is on the insurer, the defendant, and is on the balance of probabilities, taking into account the words of Dixon J in Briginshaw (supra), but not ‘at the top end of the range’, in my view the clear preponderance of probability is in favour of the proposition that Mr McFarlane drove as he did with the intention of committing suicide, and, in the sense explained earlier, that the damage to the plaintiff’s vehicle was caused deliberately by Mr McFarlane.
That being so, the exclusion clause contained in the policy has been satisfied, and the action pursuant to s 51 of the Insurance Contracts Act must fail.
For those reasons, the plaintiff’s claim is dismissed.