O'Connell v Lentelle Pty Ltd (in liquidation)
[2025] VCC 109
•17 February 2025
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-22-03763
| Cathy O’Connell | Plaintiff | |
| v | ||
| Lentelle Pty Ltd (ACN 077 486 492) t/as Jims Constructions (in liquidation) | First defendant | |
| and | ||
| Nix Plumbing Pty Ltd (ACN 159 252 570) | Second defendant | |
| and | ||
| J.D Fenton Plumbing and Drainage Pty Ltd (ACN 625 230 748) | Third defendant | |
| and | ||
| Ward Trevaskis | Fourth defendant | |
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JUDGE: | Her Honour Judge Kirton | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 7 February 2025 | |
DATE OF RULING: | 17 February 2025 | |
CASE MAY BE CITED AS: | O’Connell v Lentelle Pty Ltd (in liquidation) & Ors | |
MEDIUM NEUTRAL CITATION: | [2025] VCC 109 | |
RULING
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Subject:BUILDING CASE – INSURANCE OF LICENSED PLUMBERS - LIABILITY OF INSURERS - Ministerial Order Licensed Plumbers General Insurance Order 2002.
Catchwords: Domestic plumbing work – the nature of the insurance by which a licensed plumber is required to be covered – plaintiff homeowner contracted with builder – defects in building work including plumbing – builder in liquidation – plaintiff brought claims in this proceeding against plumbers who were subcontracted to the builder – plaintiff’s application to join plumbers’ insurers to the proceeding – the nature of the insurance prescribed by Ministerial Order Licensed Plumbers General Insurance Order 2002 – Part 12A of the Building Act 1993 – insurance policies – the entitlements of the homeowner – matters necessary to establish for joinder of a party – the role of the Court.
Legislation Cited: Corporations Act 2001 (Cth); County Court Civil Procedure Rules 2018 (Vic); Trade Practices Act 1974 (Cth) as repealed by Competition and Consumer Act 2010 (Cth); Competition and Consumer Act 2010 (Cth); Domestic Building Contracts Act 1995 (Vic); Building Act 1993 (Vic); Fair Trading Act 1999 (Vic) as repealed by Australian Consumer Law and Fair Trading Act 2012 (Vic); Insurance Contracts Act 1984 (Cth); Insurance Act 1973 (Cth).
Cases Cited:Hutchison Pty Ltd v Port Melbourne Land Custodians Pty Ltd [2022] VSC 339; S Pirrie Equities Pty Ltd v Venetian Media Group Pty Ltd [2023] VSC 253; Boral Resources (Vic) Pty Ltd v Robak Engineering & Construction Pty Ltd [1999] 2 VR 507; Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158; Wardley Australia Limited & Anor v The State of Western Australia (1992) 175 CLR 514.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | The Plaintiff appeared in person | - |
| For the First Defendant | No appearance | |
| For the Second Defendant | - | C Terrill, Terrill & Holmes |
| For the Third Defendant | - | S Moore, Wotton Kearney |
| For the Fourth Defendant | D Lorbeer | R Auricchio, MNG Lawyers |
| For Chubb Insurance | T Cogley | R Johnson, McCabes Lawyers |
| For Protecsure Insurance | - | A Tsegay, DLA Piper |
| For WFI Insurance | S Ryan | J Taylor, Meridian Lawyers |
HER HONOUR:
This hearing
1On 7 February 2025 I heard the plaintiff’s application to join the following insurance companies as new defendants to the proceeding:
(a) Chubb Insurance Australia Ltd (ACN 001 642 020) (Chubb);
(b) Protecsure Pty Ltd Australia (ABN 26 094 997 163) (Protecsure); and
(c) WFI Pty Ltd Australia / Insurance Australia Limited (ABN 11 000 016 722) (WFI).
2I gave each of the proposed joined parties leave to intervene in the hearing. Protecsure disputed that it had been properly served and it had filed no material. I gave Protecsure leave to file any affidavit or submission in opposition to the application. I also gave the plaintiff leave to provide further documents which she had referred to in her oral submissions. I reserved my decision to be able to take into consideration the further documents filed.
3For the reasons that follow I have determined that the plaintiff’s application is dismissed.
Background
4The plaintiff intended to develop two properties she owns in Windsor, one at 11 Lincoln Place and one at 14 Mary Street. According to her statement of claim and the expert reports attached to it, the works:
(a) at Lincoln Place were to partially demolish the existing dwelling and to construct a three story extension and carport; and
(b) at Mary Street were to construct a two level dwelling and a detached two-level structure comprising of a workshop and studio.
5She engaged a builder Lentelle Pty Ltd (Lentelle) to carry out these works, under two separate domestic building contracts.
6Issues arose during the construction of both properties and the plaintiff terminated the building contracts with Lentelle.
7The plaintiff originally commenced this proceeding against the builder in late 2022, alleging a number of breaches of the building contracts, including defects in the works. That proceeding progressed through a number of interlocutory steps, including with expert reports being obtained, and in August 2023 the owner’s and the builder’s experts met in conference and produced a joint report. The joint report identified that the underground plumbing in both properties has become the primary issue between the parties.
8Following receipt of the experts’ joint report, in August 2023 the trial was adjourned to allow the plaintiff to plead plumbing issues in her claim against the builder and for the builder to join the relevant plumbers to the proceeding. On 30 August 2023 the builder joined the plumbers as third parties:
(a) Nix Plumbing Pty Ltd (Nix) who the builder alleged carried out the plumbing work prior to the slab being laid at Lincoln Place. Nix is the second defendant in the proceeding; and
(b) JD Fenton Plumbing & Drainage Pty Ltd (JDF), who the builder alleged carried out plumbing work at Mary Street, including installation of belowground sewer and belowground stormwater. JDF is the third defendant.
9The plaintiff chose not to bring a claim directly against the plumbers at that time.
10In May 2024 the builder was placed into liquidation and by Orders dated 14 May 2024 the proceeding was stayed in accordance with s471B of the Corporations Act 2001 (Cth) (Corporations Act). The plaintiff has been paid out by the domestic building insurer, VMIA, in respect of her claims against the builder, for the maximum of both policies.
11On 27 August 2024 the plaintiff then applied to bring claims directly against Nix and JDF and also to join a third plumber, Ward Trevaskis (Trevaskis), who she says either supervised the Mary Street plumbing works of JDF, or was somehow complicit in the issuing of a Compliance Certificate. By Orders dated 5 September 2024 Nix, JDF and Trevaskis were joined as the second, third and fourth defendants respectively, and the plaintiff was given leave to file a second further amended statement of claim.
12Her claims against the three plumbers are listed for trial on 25 June 2025.
The plaintiff’s proposed joinder of the insurers
13Outside this proceeding, the plaintiff has been in correspondence and negotiating with the three insurance companies which stand behind each of the plumbing defendants as follows:
(a) Chubb as the insurer of JDF;
(b) Protecsure, who she alleges is the insurer of Nix; and
(c) WFI as the insurer of Trevaskis.
14Each of them offer policies of insurance to indemnify plumbers in accordance with the terms of the Ministerial Order Licensed Plumbers General Insurance Order 2002[1] (the Ministerial Order, or the MO) and their policies. The plaintiff has now applied to join the insurance companies to the proceeding by summonses issued on 24 January 2025.
[1]Victorian Government Gazette, Special, No. S 103, 20 June 2002 (‘Ministerial Order’).
15The plaintiff had foreshadowed making the joinder application in early 2024, which was noted in orders dated 18 March 2024 and 13 May 2024, and the Court set a timetable for her to make any application by 13 August 2024. She chose not to proceed with the applications at that time, and instead raised the application again at the directions hearing on 18 November 2024.
16The timetable for material to be filed in relation to these applications was set at the directions hearing on 18 November 2024. A tight timetable was set as all parties are adamant that the trial date of 25 June 2025 should be kept, the plaintiff had personal commitments in December and early January, and she had foreshadowed making these applications since early 2024.
17In support of her applications, the plaintiff has filed and / or emailed[2] the following documents:
[2]The plaintiff was unable to provide some documents on affidavit as required by the Court. In consideration of her status as a self-represented litigant, I have had regard to those emailed documents that she referred to during the hearing.
(a) Response submissions to the affidavit of Richard Johnson (Chubb) dated 4 February 2025;[3]
[3]The solicitor for the second defendant objected to various parts of this document on the grounds that it disclosed without prejudice communications. Their client maintained the privilege and provided a redacted copy of this document. I have only had regard to the redacted copy.
(b) Response submissions to the affidavit of Joseph Taylor (WFI) dated 5 February 2025;
(c) Outline of submissions in support of Protecsure Joinder Application dated 5 February 2025;
(d) Affidavit in support of Joinder of Cathy O’Connell dated 24 January 2025;
(e) Proposed Third Further Amended Statement Of Claim (P3FASOC) dated 27 January 2025;
(f) Affidavit of service of Cathy O’Connell dated 31 January 2025;
(g) Chubb renewal schedule page (page 7 of 12 only) emailed to the Court on 5 February 2025;
(h) Chubb Insurance Certificate of Currency dated 22 July 2021 (front page only) emailed to the Court on 5 February 2025;
(i) Victorian Plumbers Consumer Protection Endorsement emailed to the Court on 5 February 2025;
(j) WFI Renewal Schedule addressed to Mr W Trevaskis dated 9 July 2021 emailed to the Court on 7 February 2025;
(k) Blank Protecsure claim form allegedly emailed to the plaintiff, emailed to the Court on 7 February 2025;
(l) Protecsure claim form allegedly filled out and submitted by the Plaintiff dated 17 July 2023 and emailed to the Court on 7 February 2025;
(m) Protecsure Insurance Certificate dated 3 September 2020 emailed to the Court on 8 February 2025;
(n) Letter from M Carrafa, SV Partners Insolvency (Vic) Pty Ltd regarding J.D Fenton dated 16 August 2024 and emailed to the Court on 10 February 2025;
(o) SV Partners Small Business Restructure Appointment Pack for J.D Fenton dated 28 March 2024 and emailed to the Court on 10 February 2025;
(p) ASIC External Administration or Controllership Appointment of an administrator or controller for Lentelle Pty Ltd dated 10 May 2024 and emailed to the Court on 10 February 2025;
(q) Unsworn affidavit of Cathy O’Connell dated 12 February 2025 exhibiting:
(i)various emails and letters to and from Protecsure, the solicitor for the second defendant and the VBA;
(ii)various emails to and from Berkley Insurance Australia;
(iii)an illegible Protecsure Certificate of Currency;
(iv)a blank Protecsure claim form, a filled in Protecsure claim form; and
(v)an illegible invoice issued by Nix;
(r) Affidavit of Cathy O’Connell dated 12 February 2025, titled ‘Protecsure Documents as Requested’ and exhibiting photos of text messages on a phone; and
(s) Affidavit of Cathy O’Connell dated 14 February 2025 in response to Submissions from DLA Piper for Protecsure Pty Ltd 14th February 2025 in Opposition to Plaintiff Application dated 24 January 2025.
18The plaintiff also sought to rely on statements made in 3 emails or letters she said she had received from “the Minister’s office,” which she says support her contentions. I have had no regard to these as they are not in evidence. Most significantly, even if I accept as accurate the plaintiff’s description of those “statements” that they support her arguments, they must be taken in context. I have not had the benefit of the context as I have not seen those documents or the chain of correspondence around them. Accordingly, the plaintiff’s recollection of one sentence in an email carries no persuasive weight. I have adopted the same approach in respect of a letter which does not support the plaintiff’s case. This was sent from the Victorian Building Authority to the plaintiff dated 7 February 2025, and contradicts her submissions. I have formed my conclusions as to the operation of the MO and the policies for the reasons set out below, without having regard to the contents of that letter.
19The applications to join the three insurance companies are opposed by each of them. They have filed the following documents:
(a) Affidavit of Richard Johnson on behalf of Chubb dated 4 February 2025;
(b) Chubb’s outline of submissions dated 5 February 2025;
(c) Affidavit of Gabriele McDonald on behalf of Protecsure dated 14 February 2025;
(d) Protecsure’s outline of submissions dated 14 February 2025;
(e) Affidavit of Joseph Taylor on behalf of WFI dated 4 February 2025; and
(f) WFI outline of submissions dated 5 February 2025.
What is the test to be applied to join a party?
20The principles to be applied when considering whether to join a party to an existing proceeding are well-known and well established.
21Under rule 9.06(b)(ii) of the County Court Civil Procedure Rules 2018 (the Rules), the person seeking to join a party must prove that:
(a) they are a party to the proceeding and the person they seek to join is not a party to the proceeding;
(b) there exists a question arising out of, or relating to, or connected with, any claim in the proceeding; and
(c) it is just and convenient to determine that question between the proposed party and the other party as well as between the parties to the proceeding.[4]
[4]S Pirrie Equities Pty Ltd v Venetian Media Group Pty Ltd [2023] VSC 253, 28-29 [84].
22To succeed in her application, the plaintiff must make out, on proper material, a basis for her contention that the person sought to be added is at least in part responsible for the damages claimed by the plaintiff.[5]
[5]Boral Resources (Vic) Pty Ltd v Robak Engineering & Construction Pty Ltd [1999] 2 VR 507, 527 – 528 [75]-[76].
23In Hutchison Pty Ltd v Port Melbourne Land Custodians Pty Ltd,[6] Riordan J stated in regard to joinder applications:
With respect to the question of futility, it had been held that an applicant must show that it has ‘an arguable case against the proposed respondents, at least to the standard of being able to resist an application for summary judgment by the proposed respondent had he or she been sued in separate proceedings’.
Pursuant to s 63 of the Civil Procedure Act, a claim may be summarily dismissed if it has no real prospect of success. It makes good sense that a court would not permit the joinder of a defendant for the purpose of determining a claim that has no real prospect of success.
[6][2022] VSC 339 [36]-[37] (citations omitted).
24The Court of Appeal in Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd[7] set out the test to be applied when determining summary judgment applications pursuant to s 63 of the Civil Procedure Act 2010. Warren CJ and Nettle JA stated that the claim must have a “real”, rather than fanciful, chance of success, and the test should be understood to be, to some degree, a more liberal test than the “hopeless” or “bound to fail” test.
[7][2013] VSCA 158, 18 [35].
The plaintiff’s documents and submissions identifying the proposed claims
25As noted above, the plaintiff must make out on proper material a basis for her contentions.
26She has provided a Proposed Third Further Amended Statement Of Claim (P3FASOC) dated 27 January 2025, in which she purports to set out the legal and factual basis for the claims she wants to bring against the insurers.
27The plaintiff attempts to amend her Second Further Amended Statement of Claim dated 20 September 2024 (which was drawn by counsel), by:
(a) adding some handwritten markups to the document;
(b) annexing some documents setting out her loss and damage; and
(c) inserting a single page between page 27 and 28 which contains three typed paragraphs numbered 41 – 43.
28It is those three paragraphs which set out her proposed claims against the insurers. They state as follows:
41. I am claiming my damages and consequential losses under the Ministerial order, Licensed Plumber’s General Insurance Order 2002.
42. Part 2 Liability to be Covered Sections 10 and 11 determines my quantum $ payout including resultant damage and consequential losses.
43. Section 18 covers all reasonable legal costs and expenses associated with the successful enforcement of the claim against the plumber or the insurer.
29It is obvious from the face of the pleading that these three paragraphs are deficient and are completely inadequate to identify any possible claims from a legal or factual point of view.
30The plaintiff provided more detail of her proposed claims in her affidavit dated 24 January 2025. Although an affidavit is not a pleading, I have noted the plaintiff is self-represented. While she has had the benefit of legal advice in the past, she has made this application herself. Accordingly, I have taken into account the contents of her affidavit in assessing whether the plaintiff has established a sufficient basis to join the insurers.
31Further, at the hearing on 7 February 2025 the plaintiff said she intended to file a more detailed statement of claim setting out her claims against the insurers after they are joined to the proceeding. She made detailed oral submissions at the hearing to further explain the basis of her proposed claims. I have taken those submissions into consideration.
32The plaintiff has also exhibited the advice of a loss adjuster Mr Pockett to a solicitor Brett Samuel dated 24 July 2024, which she describes as “legal expert opinion” as to her alleged rights under the policies. I have considered the points made by Mr Pockett, under the caveat that he does not appear to be legally qualified, in case he has identified an arguable legal cause of action.
33In other words, I have proceeded on the basis that if the plaintiff has identified an arguable claim, or claims, in her oral submissions, her affidavit, or if Mr Pockett has, then she should be given the opportunity to put that into a statement of claim capable of being responded to by the proposed defendants.
What claims is the plaintiff purporting to bring?
34The plaintiff alleges that the insurers:
(a) have breached some duty allegedly owed to her;
(b) have failed to act in the utmost good faith and in breach of insurance handling laws, namely s 57 of the Insurance Contracts Act 1984 (Cth) (Insurance Contracts Act);
(c) have engaged in misleading and deceptive conduct within the meaning of s 18 of the Australian Consumer Law;[8] or s 52 of the Trade Practices Act 1974 (Cth);[9] and/or
(d) have acted in breach of the Ministerial Order.
[8]Competition and Consumer Act 2010 (Cth) sch 2 (‘Australian Consumer Law’).
[9]In her submissions, the plaintiff adopts the language of the MO which incorporates the consumer guarantees as they existed at the time in the Trade Practices Act 1974 (Cth). This Act has been repealed by the Competition and Consumer Act 2010 (Cth). For the benefit of the plaintiff, I have not discounted her references to the Trade Practices Act on grounds that it has been repealed.
35The allegations supporting these contentions appear to be that:
(a) they sold what the plaintiff describes as “junk insurance;”
(b) they have refused to pay her what she claims;
(c) they have “illegally” capped their policies at an indemnity of $50,000;
(d) in the case of WFI, it has wrongly denied cover to the plaintiff on the incorrect basis that Trevaskis is not indemnified;
(e) in the case of one or two insurers, they directed her to a complaints body which did not have jurisdiction to hear her complaint; and/or
(f) in the case of one insurer, they made her an offer which she did not accept, and now they will not re-put the offer.
36When I asked the plaintiff what specific orders she was seeking against the insurers, she said, “I am entitled to be put back in the position I was in before this happened”. I then asked the plaintiff to clarify what she meant by that, and she said, “I want my rights under the Ministerial Order.”
My role and the role of the Court
37I pause here to explain for the plaintiff’s benefit what my function and power is in determining her applications.
38The plaintiff submitted that I do not have power to interpret the Ministerial Order. She said that only the Minister for Planning can do that, as the Ministerial Order was written by their department (then Minister Delahunty). The plaintiff proposes to subpoena the current Minister for Planning to give evidence at the trial to explain the Ministerial Order.
39That submission is incorrect. The Judicial arm of government (i.e. Judges) is independent from, and separate to, the Legislative arm (i.e. the Victorian Parliament), which makes laws. It is also separate from the Executive, which comprises the Governor, the Premier, and Ministers, as well as government departments and agencies. This is crucial in effecting the separation of powers.
40The role of the Judge in a commercial case is to make findings of fact (if the facts are disputed) and to apply the current statute and common law to those facts. Where there is uncertainty or disagreement over the law, my job is to interpret the law, using the tools and approaches that have been developed over many years, i.e. applying the recognised rules of statutory interpretation. If a party thinks I have made a legal error in my analysis or conclusion, they may apply to the Court of Appeal to review it.
41The role of the Minister, and the government, is to make laws which reflect the public policies they are either elected to make, or they consider to be in the best interests of the public.
42Whether the insurance product required by the Ministerial Order is worthless or “junk insurance ” (as the plaintiff describes it) is a matter for government and public policy makers. The role of the Court in this proceeding is to apply the law and the parties’ rights and obligations as they stand. Any questions of public policy are matters for government.
The nature of the plumbing insurance
43The Plumbing Insurance required by the 2002 Licensed Plumbers General Insurance Ministerial Order is a unique insurance product.
44It is not the same as the insurance required for domestic building work (DBI), which is commonly provided by VMIA, in compliance with Part 9 Division 3 of the Building Act 1993 (Building Act) and the Ministerial Orders made on 22 May 2003 and 28 May 2014. Those MOs and policies indemnify a homeowner for loss and damage suffered if a builder becomes dead, disappeared or insolvent. The DBI MOs give the homeowner a direct right to make a claim to the insurer in those circumstances, and some policies also allow a claim to be made if a builder fails to comply with an order of a court or tribunal.
45In contrast, the plumbing insurance required by the 2002 Licensed Plumbers General Insurance Ministerial Order can best be described as a third party liability policy, with minimum terms and conditions prescribed by the MO. It operates similarly to a professional indemnity policy, in that it indemnifies the insured, being the plumber, for liabilities they may have to third parties, such as homeowners, often where there is no contractual relationship between them.
46The features of the insurance prescribed by the Ministerial Order can be described as follows.
47In Victoria, there are three different classes of plumbing work: main, specialised and restricted. There are two levels of accreditation (also known as ‘occupational licensing’) for each class. Registration is the lower form of accreditation, and allows a plumber to carry out the class of work for which he or she is registered. The higher level of accreditation is a licence. Only a licensed plumber may supervise others or issue compliance certificates.
48To be eligible to be licensed under Part 12A of the Building Act, a plumber carrying out plumbing work for which a compliance certificate is required must be covered by the type of insurance specified in the MO.[10]
[10]There are specified exclusions for other types of plumbing work but they are not applicable in the present matter.
49The MO is made under sections 221ZQ and 221ZT of the Building Act.
50All insurance policies must comply with the minimum terms of the MO and if any policy term conflicts, or is inconsistent with, the MO then the policy is to be read and to be enforceable as if it complied with the MO.
51The MO is divided into 5 Parts plus 3 Schedules. Confusingly, the paragraph numbering restarts between the Parts and the Schedules. The relevant terms are as follows.
Part 1 - Preliminary
52Part 1 of the MO[11] (clauses 1 – 9), introduce the scheme. Clause 7(1) provides that the insurance is required only in respect of plumbing work for which a compliance certificate is required.
[11]Ministerial Order (n 1), pt 1, 1-2, [1]-[9].
53Clause 8 contains an overview of the required insurance and states:
(1) A plumber, in relation to any plumbing work (or proposed plumbing work) for which a compliance certificate is required –
(a) must be covered by insurance that indemnifies him or her for any liability in respect of that work that he or she is required to be indemnified for by Part 2; and
(b) must be indemnified by that insurance for the amounts and periods required by Part 3.
(2) The insurance must be provided under a policy that –
(a) contains the provisions set out in Schedule 2 (or provisions that have the same effect); and
(b) does not contain any of the provisions prohibited by Part 4; and
(c) may contain some or all of the provisions set out in Schedule 3 (or provisions that have the same effect).
Part 2 - The minimum liability to be covered
54Part 2 of the MO[12] (clauses 10 – 17), sets out the minimum liability which must be covered. In respect of domestic plumbing work, which is the present case, the insurance must indemnify the plumber for:
[12]Ibid, pt 2, 2-4 [10]-[17].
(a) any liability they may have to pay for the cost of rectifying any plumbing work required because of defects in the plumbing work;[13]
[13]Ibid, pt 2, 2 [10(a)] (examples of which are given in the Ministerial Order (n 1), pt 2, 3 [14]).
(b) any trade practices liability;[14]
[14]Ibid, pt 2, 2 [10(b)] (defined in the Ministerial Order (n 1), pt 2, 4 [15]).
(c) any liability arising from any consequential financial loss reasonably incurred by the building owner as a result of any defects or non completion of the plumbing work, including but not limited to:
(i)the loss of any deposit or progress payment; and
(ii)the cost of alternative accommodation, removal and storage costs that are reasonably and necessarily incurred;[15]
[15]Ibid, pt 2, 2 [11(a)].
(d) public liability and completed work liability;[16] and
(e) any liability arising from “non-completion” of the plumbing work due to the following defined circumstances:[17]
(i)the plumber’s death or legal incapacity;
(ii)the plumber’s disappearance;
(iii)the plumber’s becoming an insolvent under administration as that expression is defined in the Corporations Act 2001 (Cth);
(iv)the cancellation or suspension of his or her licence as a licensed plumber; or
(v)the early termination of the contract by the building owner as a result of the plumber’s wrongful failure or refusal to complete the plumbing work.
[16]Ibid, pt 2, 2 [10(c) & (d)] (which are defined in the Ministerial Order (n 1), pt 2, 4 [16] & [17] and are not applicable to the present matter.
[17]Ibid, pt 2, 2 [11(b)(i)-(v)].
55“Defects” in plumbing work are described in clause 14 of the MO,[18] in the same terms as the warranties implied in to every domestic building contract by s 8 of the Domestic Building Contracts Act 1995 (Vic).
[18]Ibid, pt 2, 3 [14].
56“Trade Practices Liability” is defined in clause 15[19] of the MO, to mean any liability that arises as a result of the conduct by a plumber in connection with plumbing work that contravenes section 52, 53, 55A or 74 of the Trade Practices Act 1974 (Cth),[20] or section 9, 11 or 12 of the Fair Trading Act 1999 (Vic).[21]
Part 3 - Amount and period of required insurance
[19]Ibid, pt 3, 4 [15].
[20]As noted above, the Trade Practices Act 1974 (Cth) (TPA) was repealed by the Competition and Consumer Act 2010 (Cth) in 2011. The sections of the TPA cited by cl 15 of the MO have the following roughly equivalent sections in the Australian Consumer Law (n ) (ACL) : TPA s 52 is now ACL s 18; TPA s 53 is now ACL s 29; TPA s 55A is now ACL 33 & 24; and TPA s 74 is now ACL s 60.
[21]The Fair Trading Act 1999 (Vic) was repealed in 2012 by s 233 of the Australian Consumer Law and Fair Trading Act 2012. These provisions also address misleading or deceptive conduct in trade or commence, in relation to services and false representations in relation to goods and services. They each now have their equivalent in the Australian Consumer Law.
57Part 3, clause 18 of the MO prescribes that a plumber must have insurance that indemnifies him or her in respect of domestic plumbing work:[22]
(a) for public liability and completed work liability for an amount of at least $5,000,000;[23]
(b) for all other liability under Part 2 for an amount of at least $50,000 for any one claim or series of claims in relation to a completion certificate ; and
(c) for the reasonable legal costs and expenses associated with the successful enforcement of a claim against the plumber or the insurer.
[22]Ministerial Order (n 1), pt 3, 4 [18].
[23]This is not applicable to the present matter.
58Clause 20 states that a plumber must have insurance that indemnifies him or her in respect of plumbing work for which a compliance certificate is required:
(a) for the liabilities referred to in clauses 10(a)(defects), 10(b)(trade practices liability) and 11 (consequential financial loss and non-completion) from the time he or she agrees to carry out that work until:
(i)6 years after the plumber last issued a compliance certificate in relation to that work; or
(ii)if the plumber does not issue a compliance certificate in relation to the work, 6 years after the date the plumber stopped carrying out the work.
Part 4 – Prohibited provisions
59Clause 22 in Part 4[24] states relevantly that the policy must not have any provision that limits the indemnity provided under the policy with respect to any defect as a result of –
(a) any loss or damage to that part of the property on which the plumber is working and which arises out of that work;
(b) any error in design, specification, formula or pattern or the provision of advice that is incidental to any plumbing work undertaken by the plumber;
(c) the cost of inspecting, repairing or replacing component parts of plumbing work.
[24]Ministerial Order (n 1) pt 4, 5 [22].
60Part 5 contains Other Matters and Schedule 1 contains definitions.
Schedule 2 – Mandatory Provisions
61Clause 1 of Schedule 2[25] provides that this schedule sets out the provisions that the policy under which the insurance is provided must contain.
[25]Ibid, sch 2, 7 [1].
62Relevant to the present matter is clause 4 which states that in the case of domestic plumbing work, the insurer agrees to accept liability for a claim if it does not notify the person making the claim within 90 days from when they receive the claim in writing that they accept or dispute the claim, unless the insurer obtains an extension of time.
63Clause 9[26] provides that the insurer and the insured plumber both agree –
(a) that a person who is entitled to claim against the insured plumber in respect of any liability for which the plumber is indemnified under the policy may enforce the policy directly with against the insurer for the person’s own benefit if:
(i)any event under clause 11 of the ministerial order occurs; or
(ii)the insured plumber refuses to make a claim against the insurer; or
(iii)there is an irretrievable breakdown of communication between the insured plumber and the insurer; and
[26]Ibid, sch 2, 8 [9].
(b) for the purpose of that enforcement the person has the same rights and entitlements as the insured plumber would have had under any legislation applicable to them; and
(c) the insurer will pay to the person full amount of any liability for which the insured plumber is indemnified under the policy despite any failure by the plumber to pay any excess that they are required to pay.
64Clause 10[27] provides that the insurer acknowledges that s 54 of the Insurance Contracts Act applies to the policy.
Schedule 3 – Allowable Exclusions
[27]Ibid, sch 2, 8 [10].
65There are footnotes to Part 2 and Part 3 that Schedule 3 permits an insurer to cap its liability for trade practices liability, completed work liability and the total amounts paid under a policy.
66Schedule 3 contains three parts. Part 1 is headed ‘Purpose’, and states that this Schedule sets out the provisions that the policy under which the insurance is provided may contain.
67Part 2 lists allowable exclusions, none of which are relied on by the insurers in the present matter
68Part 3 lists the allowable limitations. In accordance with the footnotes to Part 2 and Part 3, Schedule 3 Part 3 clause 9 provides that an insurer may cap its liability for all types of claims to $5,000,000.00.
69In relation to trade practices liability, an insurer may pay out a maximum total which is the cost of rectifying the relevant plumbing work.[28]
[28]Ibid, sch 3, pt 3, 11 [10]
70Clauses 11 – 14 contain other allowable limitations which are not relevant to the present proceeding.
How do the MO and the policies operate in practice?
71The first important characteristic of the scheme is that it is the plumber who is the insured, not the homeowner. This is expressly stated in clauses 2,[29] 7,[30] 8(1)(a)[31] of the MO. The MO does not create circumstances in which the plaintiff homeowner would be considered an insured.
[29]Ibid, pt 1, 1 [2].
[30]Ibid, pt 1, 1-2 [7].
[31]Ibid, pt 1, 2 [8(1)(a)].
72Another important characteristic is that it is the insured plumber who is entitled to the indemnity.[32] In other words, the MO requires plumbers to have a policy which covers them as the insured; i.e. the insured is the plumber.
[32]Ibid, pt 2, 2-3 cls [10] – [13].
73The minimum amount of that cover – or indemnity – is set by the MO. The policies may offer a higher level of cover if negotiated between the plumber and the insurer.
74The scheme is designed so that a builder or homeowner may obtain a judgment against a plumber for their loss and damage caused by one or more of the heads of cover described above (such as defects in the plumbing work, or trade practices liability or noncompletion). It is the plumber who is liable to the plaintiff in that case to pay that judgment debt. The plumber may make a claim to its insurer to indemnify him, or her in relation to that liability. The insurer may accept or refuse the claim. If it refuses the claim, or attempts to cap the amount of the indemnity, then it is the plumber which may take action to challenge that decision – not the judgment creditor.
75It is important to note that it is the insured plumber who is required to make a claim on the policy. The plaintiff as a third party has no automatic right to claim under the MO or the policy.
76Having said that, a homeowner does have the right to make a claim directly to the insurer, but only in certain limited circumstances. These ‘triggers’ are set out in clause 9 of schedule 2 of the MO,[33] and are where:
(a) the plumber is dead or lacking legal capacity;[34]
(b) the plumber has disappeared; [35]
(c) the plumber is insolvent (which is defined as meaning “becoming an insolvent under administration as that expression is defined in the Corporations Act”[36] – not simply lacking funds as the plaintiff has alleged);
(d) a licensed plumber’s licence has been cancelled or suspended;[37]
(e) the plumber refuses to make a claim to the insurer;[38] or
(f) there is an irretrievable breakdown of communication between the plumber and the insurer.[39]
[33]Ibid, sch 2, 8 [9].
[34]Ibid, pt 2, 2 [11(b)(i)].
[35]Ibid, pt 2, 2 [11(b)(ii)].
[36]Ibid, pt 2, 2 [11(b)(iii)].
[37]Ibid, pt 2, 3 [11(b)(iv)].
[38]Ibid, sch 2, 8 [9(a)(ii)].
[39]Ibid, sch 2, 8 [9(a)(iii)].
77The clause does not change the nature of the policy from being a third party liability policy; that is, the Ministerial Order does not make a building owner an insured under the policy, and it does not create some additional rights that would otherwise not exist. If one of the above triggers apply, and the homeowner is entitled to make a claim directly to the insurer, the insurer is still entitled to rely upon the provisions and terms of the policy as required by the Ministerial Order in responding to the claim, both from a liability and policy response perspective.
78In other words, if the homeowner does have the right to make such a claim, they have the same rights and entitlements as the plumber would have, and the insurer will pay the full amount of any liability for which the plumber is indemnified under the policy.[40]
[40]Ibid, sch 2, 8 [9(b) & (c)].
Is there utility in allowing the Plaintiff a further opportunity to replead?
79The plaintiff’s proposed claims, as she explained them, fundamentally misconceive the Ministerial Order, the policies and the nature of the indemnity provided by the insurers.
80There is no utility in joining the insurers to the proceeding, as even if the plaintiff is given an opportunity to provide a proper statement of claim, she has not demonstrated any viable or recognised legal cause of action. For the following reasons, I am satisfied that her claims have no real prospect of success (being the test in Lysaght Building Solutions).[41] I go further and say the claims are hopeless and bound to fail.
[41][2013] VSCA 158, 18 [35].
Is the plaintiff entitled to make a claim to the insurers?
81The evidence is clear that none of the circumstances allowing Ms O’Connell to make a claim apply.
No plumber is dead, disappeared or insolvent within the meaning of the Corporations Act
82I note the plaintiff says Mr Fenton is insolvent, but there is no evidence that JDF is under administration within the meaning of the Corporations Act.
None of the licensed plumbers have had their licence cancelled or suspended.
83On the contrary, as the plaintiff pointed out, the Victorian Building Authority has investigated both her properties and three individuals faced disciplinary action in July and September 2024. They received penalties, but none had their licence cancelled or suspended.
The evidence is that each of the plumbers have made claims to their insurers
84The plaintiff deposes at paragraph 5 of her affidavit that she was entitled to make claims under the policies, as the plumbers refused to do so, and so she could. However, that statement is contradicted by the evidence of the insurers, and by the plaintiff herself during the hearing.
85Chubb’s evidence is that JDF made a claim to it, Chubb has accepted JDF’s claim and agreed to indemnify it.
86The plaintiff stated at the hearing that Trevaskis made a claim to WFI in September 2023, after she had made a claim in July 2023. That is supported by WFI’s evidence.
87Protecsure’s evidence is that it is not the correct party, and that the insurer of the relevant insurance policy held by Nix is Berkley Insurance Company (t/a Berkley Insurance Australia) (BIA). In any event, the solicitor for BIA advised the Court that Nix has made a claim to BIA, the claim has been accepted, and Nix fully indemnified.
There is no evidence of any irretrievable breakdown of communication between the plumber and the insurer.
88On the contrary, the correspondence exhibited by Ms O’Connell demonstrates that the insurers have been in regular contact with their insureds (i.e. the plumbers).
In any event, the plaintiff has made direct claims which the insurers have responded to
89Notwithstanding that the plaintiff had no right under the MO or the policy to make claims directly to the insurers, she has done so. Each insurer has responded to the plaintiff’s claims, as follows.
Chubb
90On or about 28 June 2021 Chubb issued a business insurance policy bearing policy number SBP0200559 to JDF for the period from 18 July 2021 to 18 July 2022 (Policy). A copy of the Business Insurance Renewal Schedule for the Policy (Schedule) and the Policy wording are exhibited to the affidavit of their solicitor at pages 2 to 111.[42]
[42]Affidavit of Richard Johson, sworn 4 February 2025, Exhibit RPJ1, 2-11.
91The Schedule contains an endorsement numbered BUP024 (Endorsement). The Endorsement varies the Policy to provide additional insurance coverage required by the Order, which was made pursuant to section 221ZQ of the Building Act 1993.
92Chubb has granted coverage for the Claim to JDF under the Policy, subject to its terms and conditions. Mr Johnson deposes that Chubb considers that the policy complies with the Ministerial Order, but even if it does not, Chubb will apply the terms of the Policy as if it complies with the Order.[43] JDF is defending the claim brought against it by the plaintiff in this proceeding and Wotton Kearney represents JDF on instructions from Chubb.
[43]Ibid, 5-6 [20].
93On 13 July 2023 the plaintiff contacted Chubb directly seeking to make a claim under JDF’s policy in relation to Mary Street. Mr Johnson deposes (and exhibits supporting documentation) that information relating to the claim was ultimately passed through to Chubb's casualty claims team, and allocated claim number 5330143611 (Claim). The claims team instructed a loss adjuster, Paul Hardy, to investigate the Claim.
94On 9 October 2023 Mr Hardy wrote to the Plaintiff advising that he had been instructed by Chubb that the Claim was disputed in accordance with clause 4(3) of the Schedule 2 of the MO.
95At paragraph 11 of her affidavit,[44] the plaintiff deposes to a conversation with Scott Jordan, who at the time was a Team Leader, Casualty Claims, employed by Chubb. Mr Jordan is no longer an employee of Chubb. On or about 31 January 2025, Mr Johnson spoke with Mr Jordan by telephone regarding the comments made in paragraph 11 of the plaintiff’s affidavit. Mr Jordan’s evidence is that he did not inform the plaintiff that her claim had been accepted, and that instead he informed the plaintiff that Chubb had indemnified JDF for the Claim under the Policy and that Chubb was assessing the Claim on its legal liability merits.[45] Although that evidence is second hand and is based on information and belief, I accept that evidence as it is consistent with the contemporaneous correspondence.
[44]Affidavit of Cathy O’Connell, sworn 24 January 2025, 3 [11] (‘O’Connell Affidavit’).
[45]Ibid, 5 [17].
96At paragraph 12 of the plaintiff’s affidavit,[46] she deposes to attempts to have the Claim resolved following the email from Mr Hardy. Mr Johnson’s evidence of the facts is consistent with the plaintiff’s in that:
(a) Chubb conducted an internal review of the complaint;
(b) it advised the plaintiff that Chubb was unable to further consider the complaint on the basis that the plaintiff is not an insured under the Policy;
(c) the plaintiff then lodged a complaint with the Australian Financial Complaints Authority (AFCA) in relation to the dispute of the Claim;
(d) AFCA performed a rules review at Chubb’s request, as Chubb’s view was that no financial service was provided to the plaintiff, and the plaintiff had commenced this proceeding to which JDF, being Chubb's insured, was already a party; and
(e) AFCA then determined that the plaintiff's complaint fell outside AFCA's rules, and wrote to both the plaintiff and the representative of Chubb to that effect.
[46]O’Connell Affidavit (n 44), 3 [12].
97On or about 9 October 2024 Mr Johnson wrote to the plaintiff to advise he acted for Chubb and raised issues with respect to the plaintiff's entitlements to claim under the Policy, the effect of the Ministerial Order, and her ongoing attempts to contact Chubb directly, in circumstances where:
(a) the plaintiff has no automatic right to claim under the Policy or the Order;
(b) any right to claim is triggered in certain circumstances, and those circumstances have not been met;
(c) the plaintiff is not an insured under the Policy, nor does the Order create circumstances in which she would be considered an insured;
(d) the indemnity available under the Policy is limited to the indemnity Chubb is required to provide to JDF for the Claim; and
(e) the plaintiff does not have a separate entitlement to make a claim against Chubb in circumstances where she has a claim on foot against JDF, and Chubb has indemnified JDF.
98The letter of 9 October 2024 referred to in the last paragraph precipitated an exchange of significant correspondence between the plaintiff, WK, representatives of Chubb and Mr Johnson; the nature of which ultimately resulted in an application being brought by JDF against the plaintiff for breaches of the overarching obligations under the Civil Procedure Act 2010 (Vic). This led to orders being made against the plaintiff for breaching those obligations, and an injunction ordered against the plaintiff.
99At the directions hearing on 15 November 2024 the plaintiff stated that it was her intention to seek to apply to join Chubb to the proceeding. Mr Johnson sought and was granted leave to appear and informed the Court that Chubb has fully indemnified JDF for the Claim under the Policy and would be opposing the present application, if made. This was recorded in the orders made following the directions hearing.
WFI
100Mr Taylor, acting for WFI, exhibited the Trades Insurance Kit, renewal certificate, schedule of insurance and Product Disclosure Statement by which WFI provided coverage to Trevaskis for the period 15 August 2021 to 15 August 2022.[47] The schedule states that Trevaskis is indemnified for consumer protection claims with a limit of indemnity for domestic plumbing work of $50,000.00 per home (based on a compliance certificate), and an aggregate limit of indemnity for $5,000,000.00 for all claims during the period.
[47]Affidavit of Joseph Taylor, sworn 4 February 2025.
101WFI’s evidence is that it received a claim from the plaintiff on 14 July 2023 in respect of Mary Street. WFI investigated the claim with the co-operation of Mr Trevaskis. On 14 September 2023, Mr Taylor for WFI wrote to the plaintiff in accordance with WFI’s instructions as follows:
(a) WFI had investigated the Claim;
(b) WFI had determined that the Claim would not be covered in accordance with the terms of the Ministerial Order;
(c) WFI disputed liability; and
(d) The plaintiff did not have grounds to pursue a direct claim on the Policy.
102On 20 September 2023, WFI wrote to Trevaskis in response to the Claim to set out WFI’s position. WFI stated that, following its investigations, the Claim would not be covered and that it disputed liability for the Claim.
103In October 2023 the plaintiff requested that a complaint be raised with WFI’s Internal Dispute Resolution team (IDR) to review WFI’s decision on the Claim. The final IDR decision was that as the plaintiff was not the WFI policyholder, the plaintiff was not an insured under the policy, and this meant the plaintiff could not access the IDR process for the purpose of a review of WFI’s decision. WFI advised the plaintiff of this decision on 18 October 2023.
104The plaintiff then lodged a claim with AFCA requesting that it review WFI’s decision on the Claim. In response, AFCA wrote to the plaintiff in February 2024 setting out that it could not help the plaintiff because her complaint fell outside of AFCA’s rules.
105In September 2024 the plaintiff filed her Second Further Amended Statement of Claim dated 20 September 2024 (2FASOC), in which she claims against Trevaskis for breach of statutory duty and negligence and misleading or deceptive conduct.
106In November 2024, Mr Taylor, on instructions from WFI, wrote to the plaintiff responding to the new allegations against Trevaskis in the 2FASOC, and advised that WFI maintained its position to deny indemnity for the claim and also disputed liability, in respect of both heads of claim; defective works and misleading and deceptive conduct. The basis for the decision is that:
107There can be no successful claim against Trevaskis for defective works at the Premises. In particular:
(a) Trevaskis did not perform any of the plumbing works at the Premises;
(b) Trevaskis did not supervise the plumbing works at the Premises; and
(c) Trevaskis therefore has no liability to the plaintiff for defective plumbing works or negligent supervision to trigger indemnity under the Defect in Plumbing Work Liability section of the Policy.
108There is no loss or damage for defective works insofar as it relates to a reliance on the Compliance Certificates issued under Trevaskis’ name. Trevaskis therefore has no liability for contravention of the Australian Consumer Law (ACL) to trigger indemnity under the Trade Practices Liability section of the Policy.
109In respect of the misleading and deceptive conduct claims pleaded against Trevaskis, for the reasons set out above the Policy does not respond to the allegations concerning ACL.
110Further, the Ministerial Order concerning Trade Practices Liability coverage requires an agreement by Trevaskis to perform plumbing work at the premises. This is contained in clause 20 of the MO. In the present matter, there was no agreement by Trevaskis to carry out plumbing work at the premises; namely, he was not engaged to perform or supervise the plumbing works.
111The plaintiff referred to the statement in the letter from Mr Taylor for WFI to her dated 14 September 2023, in which he stated that the compliance certificates are invalid/void. The plaintiff argued that this is grounds to show WFI’s decision was wrong, because the VBA has refused to invalidate or void the compliance certificate issued in Trevaskis’ name. That submission misunderstands the statement made by Mr Taylor. WFI’s reasons for rejecting her claim are contained in the balance of that paragraph and the following paragraph after the words, “(t)he compliance certificates are invalid/void…” Those reasons are summarised in the paragraph above.
112The plaintiff also took issue with WFI’s use of the phrase “aggregate limit of indemnity for all claims,” arguing that the MO does not include the word “aggregate.” Again, the plaintiff has misunderstood the operation and wording of the policy. The insurer has imposed a cap of $5,000,000.00 for all claims made by the insured during the period of insurance, not just the claims made in relation to her property.
Protecsure
113The evidence of the Managing Director of Protecsure,[48] is that Protecsure is an underwriting agent, not an insurer. It is not authorised to carry on insurance business under the Insurance Act 1973 (Cth) (Insurance Act) and is not licensed as an insurer with the Australian Prudential Regulation Authority. As the holder of an Australian Financial Services licence, it is authorised to deal in a financial product in respect of general insurance products (such as public and products liability insurance policies).
[48] Affidavit of Gabriele McDonald, affirmed 14 February 2025, 2-4 [4]-[17].
114Protecsure is not the insurer of the relevant insurance policy. The insurer of the relevant insurance policy is BIA. Protecsure, as agent for BIA, issued a public and products liability insurance policy to Nix via its insurance broker for the relevant period. The policy schedule[49] states the insurer is BIA and that notice of any claim should be made to Protecsure.
[49] Attached to the plaintiff’s submissions in support of the joinder application dated 5 February 2025.
115The plaintiff submitted that she does not know which entity is the insurer of Nix. She brought the application against Protecsure as they were named at the top of the claim form she used to make her claim. She agreed that she had been corresponding with BIA’s solicitors about her claim, and deposed in her affidavit that "the claim has still not been settled by Berkley who underwrites Protecsure”. She asked the Court to answer the question for her.
116I accept the evidence of Protecsure. Accordingly, the plaintiff’s application to join Protecsure is misconceived.
117Further, although BIA has not filed any evidence (it was not required to do so as no application has been made against it) Protecsure’s evidence is that BIA has informed it that BIA has granted indemnity to Nix for the plaintiff’s claim in this proceeding, subject to the terms and conditions of the policy.
118It follows that the plaintiff has no right of action against Protecsure, and nor has she identified any legal or factual basis to support a claim against Nix’s insurer BIA.
Even if the plaintiff was entitled to make a claim under the policies, what are her rights and entitlements ?
119Even if the plaintiff was entitled to make a claim under the policies, she has the same rights and entitlements as the plumber would have under the policy. Her contentions seem to indicate she wants to claim much more than the limit of the indemnity. Each of the insurers made submissions as to why her proposed claims are without merit.
Chubb
120The evidence of Chubb is that it has provided JDF with a complete indemnity, to the limit of the MO. On that basis, it is impossible to understand the basis for any claim that Chubb has breached any duty owed to the plaintiff, or has somehow otherwise failed to comply with the terms of the ministerial order and the policy.
121It is not enough to simply say there is a duty of utmost good faith implied into the insurance contract. That is not disputed. In order to bring an arguable claim, she must also provide details of elements such as the following:
(a) The insurer owes the plaintiff a duty of utmost good faith;
(b) The insurer has breached that duty (if owed);
(c) What provisions of the (presumably) Corporations Act relating to the provision of claims handling and settling services the insurer is alleged to have breached and how those provisions have been breached;
(d) What comprises "junk insurance;"
(e) how that is relevant to any proposed claim;
(f) how it is that the insurer is selling "junk insurance" (specifically in the context of the insurance policy relevant to her claim against each plumber in the proceeding and its compliance or otherwise with the Ministerial Order); and
(g) how any of these matters have resulted in the Plaintiff suffering loss and damage, what that loss and damage is, and how that loss and damage is separate to the relief being claimed against each plumber in the proceeding.
122I agree with Chubb’s submission that the plaintiff has not addressed any of these matters.
WFI
123WFI has determined that Trevaskis had no liability to the plaintiff and that Trevaskis is not entitled to be indemnified under the WFI policy. This is on the following basis:
(a) Trevaskis was not engaged to undertake, nor did he undertake any of the plumbing work at Mary Street.
(b) The plaintiff’s claim against him relates to the issuing of the compliance certificate.
(c) Trevaskis denies the factual allegations, but if it is proven he was somehow complicit in issuing the compliance certificate, the MO does not cover him or the plaintiff for such an event. The MO and the WFI policy provides insurance for plumbing work which the insured agreed to do.[50] The clear conclusion from the MO is that the insurance covers plumbing work performed by the insured plumber, namely JDF.
(d) Trevaskis did not agree to carry out, or supervise any plumbing work.
[50]Ministerial Order (n 1), pt 1, 1 [7]; pt 2, 2 [10]; pt 3, 5 [20].
124Further, the plaintiff is required to demonstrate she has suffered a loss by reason of Trevaskis’ conduct. This is required if her claim is under the Trade Practices Act as she states in her affidavit, or under the Policy.
125It is well settled law that there can be no cause of action for misleading and deceptive conduct unless or until loss occurs by reason of the conduct.[51]
[51]Wardley Australia Limited & Anor v The State of Western Australia (1992) 175 CLR 514, 540.
126Here, the plaintiff is required to establish a causative nexus between the Compliance Certificate and the loss alleged. Clearly, and regardless of whether or not Trevaskis was complicit in the manufacturing of the Compliance Certificate, the chronology illustrates that the plumbing defects complained of occurred approximately 18 months prior to the issuing of the Compliance Certificate. The plaintiff did not rely upon the Compliance Certificate and it caused no loss.
127If the plaintiff proposes to allege that she has suffered consequential losses as a result of misleading and deceptive conduct, that claim is hopeless as the MO permits an insurer to limit any payment under the Trade Practices Liability to the cost of rectifying the relevant plumbing work – i.e. the defective plumbing work (rather than consequential losses).[52]
[52]Ministerial Order (n 1), sch 3, pt 3, 11 [10].
128I agree with WFI’s submission that the plaintiff has not addressed any of these matters.
Protecsure
129As set out above, Protecsure is not the insurer of Nix and so has no liability to Nix or the plaintiff. The plaintiff has not identified any cause of action that would provide any basis for a claim against Protecsure.
130Further, there is no utility in allowing the plaintiff to make a further application to join BIA, as she has not identified any basis for a claim against BIA. Although I have not heard from BIA, it appears the same situation applies as with Chubb. BIA has granted indemnity to its insured Nix. On that basis, it is impossible to understand the basis for any claim that BIA has breached any duty owed to the plaintiff, or has somehow otherwise failed to comply with the terms of the ministerial order and the policy.
Not the role of this hearing to consider the minimum or maximum amounts of indemnity available to each plumber under the policies
131The plaintiff alleges that the insurers have “illegally” capped their liability under the policies at $50,000.00 each. She says this is one of the bases for her claims that they failed to act in good faith or are in breach of the Trade Practices Act.
132As I have explained, the policy is a type of third party liability policy, with minimum terms and conditions prescribed by the MO. In respect of domestic plumbing work, the plumber is indemnified for defined liabilities. Those relevant to the present proceeding are:
(a) “Defects;”[53]
(b) “Trade Practices Liability;”[54]
(c) any liability arising from any consequential financial loss reasonably incurred by the building owner as a result of any defects or non-completion of the plumbing work;[55] and
(d) any liability arising from non-completion of the plumbing work due to the death, legal incapacity, disappearance, insolvency (as defined in the Corporations Act), loss of licence, or early termination of the plumbing contract.[56]
[53]As defined in the Ministerial Order (n 1), pt 2, 3-4 [14].
[54]As defined in the Ministerial Order (n 1), pt 2, 4 [15].
[55]Ministerial Order (n 1), pt 2, 2 [11(a)].
[56]Ibid, pt 2, 2 [11(b)].
133The policy covers the insured – being the plumber. The amount of that cover – or indemnity – is a matter between the plumber and the insured. If the insured considers that the insurer is not entitled to cap its liability at $50,000.00, that is a matter for the insured to litigate.
134It is not the role of this hearing to consider the minimum or maximum amounts of indemnity available to each plumber under the MO and the policies.
Mr Pockett’s opinion
135Mr Pockett is a chartered loss adjuster. He declares himself (or his company Metropolis), to be the ‘leading authority in Australia’ on the Ministerial Order. He provided a letter to a solicitor Brett Samuel dated 24 July 2024, which the plaintiff relies on.[57]
[57]O’Connell Affidavit (n 44), Exhibit, 21-26.
136It is not known if Mr Pockett has consented to his letter being produced to the Court in support of the plaintiff’s application. The purpose for which he produced the letter is not known. It is also not known whether he agrees, or disagrees with the contentions put by the plaintiff.
137There are obvious issues with the plaintiff attempting to rely on a letter from a loss adjuster as expert legal opinion. It is clearly inadmissible as evidence. Mr Pockett does not appear to be legally qualified. His expertise to give opinion evidence on the interpretation of statutes, ministerial orders, and commercial contracts of insurance, is not established. The instructions he was given are not stated.
138Leaving that issue to one side, Mr Pockett’s letter amounts to no more than a series of observations on the terms of the Order and a series of assertions that insurers generally do not understand, or comply with it.
139He is critical of the public policy behind the scheme, and the nature of the insurance offered. His comments are directed more to what an ideal scheme should provide, rather than what the current policies and MO require.
140Where he does purport to provide opinions as to what the coverage must include, he does not provide any references within the Ministerial Order to support the conclusions. For example, he states that consequential financial losses in respect of domestic plumbing work have unlimited coverage. He does not identify the clause of the order he relies on to reach that conclusion. Presumably it is clause 11(a),[58] being the only clause which refers to a liability for consequential financial loss. However, Mr Pockett does not address the whole of that clause, which provides that consequential financial loss is covered if it is incurred as a result of any defects or noncompletion of the plumbing work. Mr Pockett states elsewhere in his letter that the insurer may limit cover to $50,000.00 for defective and non-completion claims, which appears inconsistent with his first statement.
[58]Ministerial Order (n 1), pt 2, 2 [11(a)].
141In any event, I have had no regard to the letter. It does not purport to address the conduct of the insurers in relation to the subject matter of the proceeding. It is wholly irrelevant.
The Plaintiff’s application for a costs order under the MO
142Lastly, I will address the plaintiff’s final oral submission of the day. She contended that I should make an order that the insurers pay her legal costs and expenses now, so that she can afford to engage legal representation for the trial. She relied on clause 18 of the MO which prescribes that a plumber must have insurance that indemnifies him or her in respect of domestic plumbing work “for the reasonable legal costs and expenses associated with the successful enforcement of a claim against the plumber or the insurer.”[59] The plaintiff’s argument is misconceived. That clause does not operate to provide her with payment for legal costs in advance of them being incurred.
[59]Ibid, pt 3, 4 [18(c)].
143The plaintiff also sought an order to compensate her for the legal costs she has already incurred. This application is premature. The plaintiff must first obtain a costs order in her favour against an insured defendant. It is not possible to make any order for costs before knowing the outcome of the proceeding, including the relevance of settlement offers that may have been made or refused. Then, if a costs order is made in her favour, and assuming the plaintiff can enforce the indemnity given to the insured plumber, she only has the same rights and entitlements as the plumber would have under the policy.
Conclusion on the Plaintiff’s joinder application
144There is no dispute that there are plumbing defects in the two properties. However, that alone is not enough for the plaintiff to succeed in claims against the plumbers’ insurers. She must show a legal cause of action, supported by arguable facts, which she has not done.
145The MO and the policies issued in compliance with the MO do not create a cause of action. The scheme established by the government is, in summary, that:
(a) The Building Act requires licensed plumbers to carry specified types of insurance for works they agree to undertake for which a compliance certificate is required.
(b) The insurance in question is a form of third party liability cover, with minimum terms specified in the Ministerial Order.
(c) The scheme provides homeowners and builders with protection, to at least the specified minimum levels, by requiring licensed plumbers to have insurance in place which may respond if the licensed plumber is unable to pay a judgment, or is unwilling to engage in a claim.
(d) The insured under the plumber's insurance is the plumber. The homeowner is not the insured.
(e) An insurer’s liability to its insured is limited to the scope of cover under the policies, which is largely mandated by the relevant provisions of the MO.
(f) Under the MO, an owner can only make a claim on the insurance under limited circumstances, including where the plumber refuses to make a claim.
(g) In this case, each of the plumbers has made a claim.
(h) Where an insurer refuses the claim, i.e. refuses to grant indemnity to the plumber, then the only person entitled to seek a review of that decision is the plumber.
(i) Where the insurers have each already made a decision whether to accept their insured's claim, there is no utility in joining them as parties to this proceeding on application by the owner as the Court does not have power to make any order against the insurers in favour of the owner.
146The plaintiff’s submissions do not address these matters. Instead, she contends that she is entitled to bring other claims against the insurers in this proceeding. However, she has not identified any legal duty owed by the insurers to her, nor how any such duty has been breached. One proposed party is not an insurer. Two insurers have indemnified their insureds and another has determined that no liability has been triggered. The plaintiff seems to have confused her claims that the insurers have breached the Trade Practices Act or ACL with the head of indemnity under the MO which covers a plumber’s “Trade Practices Liability.” She has not identified any failure to act in the utmost good faith and/or any breach of “insurance handling laws” and/or s 57 of the Insurance Contracts Act. She has no automatic right to make claims directly to the insurers, and has not shown that any of the triggers which would give her that right apply.
147None of the insurers dispute that their policies must comply with the MO. The plaintiff has not identified any instance where the policies do not comply. In any event, even if she had, the insurers agree that the terms of the MO take precedence over the policy.
148Whether the product required by the Ministerial Order is worthless, or “junk insurance” (as the plaintiff describes it), is a matter for government and public policy makers. The role of the Court in this proceeding is to apply the law and the parties’ obligations as they stand. Any questions of public policy are matters for government.
149The plaintiff’s current application is an abuse of process and will be dismissed. There is no utility in allowing the plaintiff a further opportunity to make a further application in circumstances where she has not identified any arguable claim, despite having foreshadowed bringing the application in early 2024, and the trial against the plumbers is listed for June 2025.
150The insurers’ liability to indemnify the defendants is dependent on the plaintiff proving her claims against the plumbers. The plaintiff has the opportunity to prove her claims against the plumbers at the trial in June 2025. Whether the insurers are parties to the proceeding does not affect their potential liability to their insureds under the policies. I urge the plaintiff again to seek legal advice.
151Courts and Tribunals must apply the law which does not always give parties what they think is a reasonable, fair and just outcome. Joining a party to a proceeding is a serious matter with possible cost consequences for all involved. I acknowledge and understand the plaintiff’s disappointment that her plans to develop her two properties have not resulted in the outcome she had hoped for. However, the law does not let me make orders just because a party thinks their current situation is unfair. I have a duty to all parties who appear before the Court to apply the law, and therefore I must be satisfied that a plaintiff has an arguable legal cause of action before joining a party to a proceeding.
152I will make orders dismissing the applications for joinder made in the plaintiff’s summonses issued on 24 January 2025. I will hear any applications for costs at the next directions hearing on 24 February 2025.
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Certificate
I certify that these 39 pages are a true copy of the ruling of her Honour Judge Kirton delivered on 17 February 2025.
Dated: 17 February 2025
Jessica Meaney
Associate to Her Honour Judge Kirton
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