QBE Insurance (Australia) Ltd v Brown - [2017] SADC 66

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Appeal Against a Master's Decision)
QBE INSURANCE (AUSTRALIA) LTD v BROWN & ORS
[2017] SADC 66
Reasons for Decision of His Honour Judge Beazley
28 June 2017
PROCEDURE - INFERIOR COURTS - SOUTH AUSTRALIA - DISTRICT COURT
PROCEDURE UNDER RULES OF COURT - Summary Judgment.

INSURANCE - GENERAL
CONSTRUCTION OF INSURANCE POLICIES - insuring clauses - whether the respondent is entitled to indemnity from the appellant, for the potential liability for injuries sustained by another pursuant to policies of insurance issued by it to, inter alios, the respondent's parents - the use of dictionaries - the meaning of the words, 'family'; 'home'; 'home buildings'; and 'primary residence'.
Appeal - general principles - appeal from decision of a Master dismissing an interlocutory application brought by the appellant against the respondent for, inter alia, summary judgment pursuant to Rule 6 DCR 232(2)(b) - the issue before the Master was not whether the insurance policy did respond to the respondent's claim for indemnity, but was whether it was reasonably arguable.
Whether the appellant's 'Farm Pack' Personal Insurance Policy and/or its 'Small Farm' Rural Insurance Policy, issued to the respondent's parents, do respond to the potential liability faced by the respondent, for the catastrophic injuries suffered by the plaintiff in the subject action - whether the respondent falls within the description of 'children who normally live in [the insured's] home' - whether the residence on the said property was the insured's 'home'. The Master held that the respondent's claim against the appellant was reasonably arguable - whether the court ought interfere with the decision of the Master - whether the Master erred in not making an order for summary judgment in favour of the appellant.
HELD: Appeal dismissed. The Master did not err in concluding that the appellant had not established that the respondent had no reasonably arguable case for his claim against the appellant - there are significant questions of fact and law which must be decided upon the whole of the evidence to be called at trial.
Insurance Contracts Act,1984 (Cwlth) s 48; Insurance Contract Regulations, 1985, (Cwlth) Reg 2(1); District Court Act, 1991, (SA) s 43; District Court Rules, 2006, (SA) Rules 193, 232 and 286, referred to.
McCann v Switzerland Insurance [2000] 203 CLR 579; Hall v QBE Insurance [2008] NSWCA 294; Herbert v Byrne [1964] 1 AllER 882; Langford Property Co Ltd v Athanassoglou [1948] 2 AllER 722; CIC Insurance Ltd v Bankstown Football Club Ltd [1997] 187 CLR 384; Uber v Commissioner of Taxation (Cwlth) [2017] FCA 110; State Chamber of Commerce and Industry v Commonwealth (1987) 163 CLR 329; Spencer v Commonwealth (2010) 241 CLR 118; Groom v State of SA [2017] SASCFC 35; Cene Avenue Pty Ltd v Martin [2008] 106 SASR 1; Proude v Visic (No 4) [2013] SADC 154; Estate of Bradman v Allens Arthur Robinson (2010) 107 SASR 1; McLean v DID Piling Pty Ltd [2010] SASC 33; Adelaide (SA Pools & Spas) Manufacturing and Installation Pty Ltd v Westcourt General Insurance Brokers Pty Ltd [2016] SASC 60; QBE Insurance (Aust) Ltd v Wesfarmers General Insurance Ltd [2010] NSWSC 855; Collins v Djunaedi [2016] SASCFC 48; Burge v Commonwealth Bank of Aust (No 3) [2017] FCA 383; Albion Insurance Co Ltd v GIO (NSW) (1969) 121 CLR 342; Horsell International Pty Ltd v Divetwo Pty Ltd [2013] NSWCA 368; QBE Insurance Aust Ltd v Vasic [2010] NSWCA 166; Barroora Pty Ltd v Provincial Insurance Ltd (1992) 26 NSWLR 170; Messagemate Aust Pty Ltd v National Credit Insurance (Brokers) Pty Ltd (2002) 83 SASR 303; Caldwell v J A Neilson Investments Pty Ltd [2007] NSWCA 3; Galaxy Homes Pty Ltd v National Mutual Life Association of Australia Ltd [2012] SASC 141; Tschirn v Australian Executor Trustees Ltd [2015] SASC 58; Vero Insurance Ltd v Australian Prestressing Services Pty Ltd [2013] NSWCA 181; Provincial Insurance Pty Ltd v Consolidated Wood Products (1991) 25 NSWLR 541; Eaton & Sons Pty Ltd v Warringah Shire Council (1972) 129 CLR 270; Home & Overseas Insurance Ltd v Mentor Insurance Co (UK) Ltd (1989) 3 ALLER 74; Gray v Mercantile Mutual Insurance (Aust) Ltd (1994) 63 SASR 154; House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44; Mann's Annotated Insurance Contracts Act, 7th edition; Todd v Nicol [1957] SASR 72; Esanda Finance Corporation Ltd v Peat Marwick Hungerfords (1997) 188 CLR 241; Derrington & Ashton 'The Law of Liability Insurance' (2013), 3rd edition, Vol 1 Chapter 3 and Vol 2 Chapter 11; CIC Insurance Ltd v Bankstown Football Club Ltd [1997] 187 CLR 384, considered.

QBE INSURANCE (AUSTRALIA) LTD v BROWN & ORS
[2017] SADC 66
Introduction

This is an appeal from a decision of a Master of this Court, dated 26 August 2015, dismissing an interlocutory application brought by a third party in the principal proceedings, QBE Insurance (Australia) Ltd (‘the appellant’), against the defendant in those proceedings, Jonathan Brown (‘the respondent’).[1]
[1] Reasons (No 4). Casebook p. 175.
In the principal proceedings, Joshua Liddy (‘the plaintiff’), claims damages for personal injuries sustained by him at a property at Main Road Delamere (‘the said property’) on 31 December 2007. The respondent resided on the property at the time of the accident.
The respondent joined the appellant to the principal proceedings as a third party, seeking indemnity for the plaintiff’s claim against him, pursuant to policies of insurance issued by it. One of those policies was issued to ‘named insureds’, which included the respondent’s parents, while, in the other policy, the ‘named insured’ was a corporate entity controlled by the respondent’s father.
The appellant, in its interlocutory application dated 12 August 2014, had sought, inter alia, an order for summary judgment against the respondent in respect of the claim for indemnity, specified in the latter’s Third Party Statement of Claim, pursuant to Rule 6 DCR 232(2)(b) of the Rules of Court.
The appeal from the Master’s decision, raises a number of matters of importance. These include the question as to whether the Master retains a discretion to decline to order summary judgment irrespective of the proper construction of the respective policies of insurance. This issue was left open in a number of recent cases including Tschirn v Australian Executor Trustees Ltd.[2]
[2] [2015] SASC 58.
It is necessary to set out, in some detail, the background to the appellant’s interlocutory application in order to understand the respective submissions of the parties. The matter had proceeded before the Master in a somewhat disjointed manner, because of difficulties with the respondent’s Third Party Statement of Claim. The Master, in consequence, elected to deliver separate judgments on the matters raised by the appellant in its interlocutory application.
At the outset it is important to remember that neither the Master nor this Court is to consider as a preliminary point of law, the proper construction of the relevant clauses of the insurance policy.
The sole inquiry subject to any residual discretion, is and was whether the appellant has satisfied the Court that there was no reasonable basis for the respondent’s claim for indemnity under the policy.
The background
In general there was no dispute as to the relevant facts, either at the hearing before the Master on 23 October 2014, nor upon the hearing of this appeal. I place that caveat because both counsel referred to some issues on the third Third Party Statement of Claim which gave rise to a potential factual dispute. One of them involved the question whether in the case of extended cover for directors of a corporate, ‘named insured’, the director was acting in the course of his duty as a director. Another involves the question of what policies were in force at the time.[3]
[3] Transcript, 22/11/15, at pgs. 5, 16 - 18 and 36.
In their respective outlines both counsel assumed that there were two separate policies of insurance issued by the appellant. Neither counsel is bound by that position. A question may arise that the two documents form part of the one policy. As will become clear each ‘policy’ or policy document has the same policy number, and purported to cover, in most cases, similar risks on the said property.
Each of these possible issues could not be determined on the appeal, as their resolution would require the parties to give further evidence.[4] The appellant submitted that those issues were not fatal to its application, and it was content to argue its appeal upon the facts pleaded by the respondent in his third Third Party Statement of Claim.[5] The appellant has not yet filed its defence to that pleading.
[4] Transcript, 22/11/15, at p. 18.
[5] Appellant's Summary of Argument; FDN 53 pg 2.
The final form of the third Third Party Statement of Claim was filed by the respondent well after the hearing before the Master.
The other relevant facts in these Reasons were sourced from the undisputed findings in the Reasons of the Master,[6] or from filed documents, which objectively could not be the subject of a dispute.
[6] FDN 47 at [11]-[23].
The facts are as follows:
·From about 2001, the registered proprietor of the said property was Second Valley Nominees Pty Ltd. Its directors and shareholders were Kevin Brown and Barbara Brown. Second Valley Nominees Pty Ltd was the sole shareholder of Highbrooke Pty Ltd, while Kevin Brown was its sole director.
·From about 2001, a partnership which included Second Valley Nominees Pty Ltd, conducted a farming business from the said property. The partners, other than Second Valley Nominees Pty Ltd, had occupied the main homestead on the said property.
·Highbrooke Pty Ltd, in 2001 owned plant and equipment. It conducted a farming business; a spring water and aquaculture business.
·In about 2004, the partnership was dissolved, and the farming business ceased. The former partners vacated the main homestead. Subsequently a ‘bed and breakfast’ business, on the said property, was conducted by Highbrooke Pty Ltd under the business name, ‘Fleureu Springs Estate’.
·Prior to April 2007, Highbrooke Pty Ltd resolved to cease the business of Fleureu Springs Estate.
·The respondent is the son of Kevin and Barbara Brown. In or about April or May 2007, the respondent, his wife and two children resided at the subject Main Homestead on the said property. They remained in residence as at 31 December 2007.
·Neither Kevin Brown nor Barbara Brown had resided at the subject residence at the said property either prior to or as at 31 December 2007.
·For over 20 years prior to 2007, Kevin and Barbara Brown, in their personal and corporate capacities, had requested insurance coverage for the said property through Adrian Middleton (‘the second Third Party’) and Beverley Jane Middleton (trading as Middleton Insurance Consultants)(‘the third Third Party’).
·In the month of May 2007, Kevin and Barbara Brown received renewal invitations in respect of Farm Pack Insurance over the said property which included cover for ‘Legal Liability to others’ in respect of the ‘Home Buildings’. Their ‘proposal’ for the period 10 June, 2007 to 10 June 2008 was accepted by the appellant, which was the sole underwriter at the time that the plaintiff was injured. The proposal form, if one existed, was not put in evidence before the Master.
·The appellant ultimately issued two policies of insurance, through the third Third Party, together with schedules covering the period 10 June 2007 to 10 June 2008. Those schedules detailed the risks to be covered pursuant to each section of the respective policies.[7] The schedules placed before the Master on one policy were dated 22 November 2011, while the schedules on the other policy were dated 23 April 2008. However nothing turned upon those different dates during the respective submissions of the parties.
[7] Casebook pgs. 15 - 152.
Where more than one person is insured, for their respective rights the policy is a ‘Composite Policy’, and not a ‘Joint Policy’.[8] The ‘Composite Policy’ provides indemnity for persons, either named or referred to therein, for a variety of risks, and includes cover for specified third party liability.
[8] Federation Insurance Ltd v Wasson (1987) 163 CLR 303 at pgs. 309 - 311.
For present purposes I will assume that there are two separate policies of insurance.
The policy documents are:
·QBE Insurance Australia Farm Pack Personal Insurance Policy No 61A082866LPK (‘the Primary Policy’).
The schedules to that policy covered some 8 sections, the first of which was a ‘Home Buildings and Home Contents’ section, which included ‘Personal Legal Liabilities to others’; while others included a ‘Farm Liability’ section; a ‘Farm Property’ section and various motor vehicle and commercial sections; and
·QBE Insurance Australia Small Farm Rural Insurance Policy No 61A082866LPK (‘the Alternate Policy’).
The schedules to the ‘Alternate Policy’, also covered some 8 sections which similarly included the ‘Home Buildings and Home Contents’ section, and its ‘Personal Legal Liability to others cover’; a separate ‘Legal Liability’ section; ‘Farm Buildings’; various motor vehicles and commercial vehicles; and ‘Farm Liability’.
The product disclosure statement for each policy purported to include cover for ‘legal liability for $20,000.000 … (including) liability for you or any member of your family in respect of ownership of your home (where your home is insured under this policy … (my emphasis).[9]
The Schedule to each policy covering ‘Home Buildings and Home Contents’ purported to cover the ‘Main Homestead’ including ‘Personal Liability to others’.[10]
·The Primary Policy
[9] The Primary Policy - Casebook p. 91. The Alternate Policy - Casebook p. 18.
[10] The Primary Policy - Casebook p. 143. The Altenate Policy - Casebook p. 77.
The named insured in the Schedule to the primary policy were Kevin Brown, Barbara Brown, Highbrooke Pty Ltd, and the business name ‘Fleureu Springs Estate’.
Relevantly the ‘Primary Policy’ purported to provide cover pursuant to its ‘Home Buildings and Home contents’ section, as follows:
Your personal legal liability to others.
We insure you and your family (my emphasis) against any claim for compensation or expenses which you or your family become legally liable to pay for:
(a) The death of, or bodily damage to, any person … resulting from an occurrence during the period of insurance arising out of the ownership of the home buildings or occupancy of the home buildings…. (my emphasis)
The ‘Primary Policy’ purported to provide extended cover in the event that ‘the section covered the ‘home contents’, and the home building is your primary residence’ (my emphasis). In such a case it purported to ‘insure you and your family for the death or bodily injury to any person anywhere in the world’ if the ‘home buildings’ is your ‘primary residence’.[11]
[11] Casebook pgs. 111 - 113 and Schedule p. 143.
‘Occurrence’ was defined as ‘an event … which results in personal injury which you neither expected nor intended to happen’.
‘Home Buildings’ were defined as ‘the dwelling used primarily as a place of residence at the farm’, and specifically included in-ground pools.
‘Family’ was defined as ‘you and your spouse (legal or de facto) and children who normally live in your home’. It also included ‘your and your spouse’s parents who normally live in your home’.
The words ‘you, your’ were defined as ‘the person(s), companies or firms named on the current policy schedule as the ‘insured’.
·The alternate policy
The named insured in the schedule to the ‘Alternate Policy’ were Highbrooke Pty Ltd, and the business name ‘Fleureu Springs Estate’.
Of relevance, the ‘Alternate Policy’ purported to provide cover for liability to others in two sections; not simply one section as is the case with the ‘Primary Policy’. They are:
‘Section 1: ‘Home Buildings and Home Contents’.
Your personal liability to others.
What we will pay.
If this section covers your home buildings … we insure you and your family against any claim for compensation or expenses which you or your family become legally liable to pay for:
(a) The death or bodily injury to any person resulting from an occurrence during the period of insurance arising out of the ownership of the home buildings or occupancy of the home buildings.
‘Section 4 – Legal Liability’:
Legal liability.
This section covers you and your family for your legal liability for injury or damage to other people or their property.
We will pay the following to you or on your behalf for:
·Any amount that you are legally liable to pay including costs awarded against you.
·Personal injury … which occurred within the period of insurance.
·We will defend any proceedings against you seeking damages for personal injuries … in your name and on your behalf even if the suit is groundless or fraudulent.
·On 31 December 2007, the respondent resided at the Main Homestead on the said property. The plaintiff asserts that on that day he was visiting the respondent when he struck his head sliding down a waterslide into a small wading pool. In consequence, he suffered catastrophic injuries, including permanent tetraplegia.
·On 22 December 2010, the plaintiff commenced the principal proceedings. He initially claimed relief against the respondent; his father Kevin Brown; Highbrooke Pty Ltd; and Second Valley Nominees Pty Ltd. He claimed damages from them, based upon their respective interests in the said property.
·On 11 November 2003 the plaintiff discontinued the proceedings against all defendants bar the respondent. He claims damages from the respondent as occupier of the Main Homestead.
·The respondent asserts that the respective policies of insurance provide cover to him during the relevant period as during that period he, as a member of his father’s family, normally lived in the ‘home on the said property’.
·The respondent sought indemnity from the appellant pursuant to each policy of insurance, for any legal liability which he may face for the injuries sustained by the plaintiff.
·By letter dated 17 January 2012 from its solicitors, the appellant declined indemnity to the respondent on the bases that he was not a ‘named insured’ under the policies, nor did he ‘fall within the meaning of ‘family’ as defined within the policies for the purpose of the relevant insuring clause’.[12]
·On 28 April 2014, the respondent provided to the appellant a draft second Third Party Statement of Claim, in which he sought an order for indemnity pursuant to the respective policies of insurance taken out by his parents; together with alternative claims for damages for breach of the Trade Practices Act, 1974, (C’wlth) or for breach of a duty of care.
[12] Exhibit KEW04 the affidavit of Kristie Wilson sworn 5 July 2012.
The appellant’s interlocutory application, the subject of the appeal
On 12 August 2014, the appellant issued an interlocutory application, in which it sought a series of orders, as follows:
1.   That pursuant to Rule 6R 232 summary judgment be entered for the appellant against the respondent.
2.   Alternatively, pursuant to Rule 6R 233 judgment be entered for the appellant in respect of:
2.1The respondent’s claim for a declaration that he is entitled to indemnity pursuant to the terms of the policy or alternate policy; and/or
2.2The respondent’s claim for damages for misleading or deceptive conduct pursuant to s 82 of the Trade Practices Act and/or s 12GF of the Australian Securities and Investment Commission Act 2001; and/or
2.3The respondent’s claim for damages for negligence.
3.   In the alternative to paragraphs 1 and 2, that pursuant to Rule 6 DCR 104, various paragraphs of the Third Party Statement of Claim be struck out.
4.   That pursuant to Rule 6 DCR 102, the respondent provide further particulars as to various paragraphs of the Third Party Statement of Claim.
The hearing before the Master
·On 23 October 2014, the Master heard the submissions of the appellant, and the respondent on each of the paragraphs of the appellant’s application. Between that date and 27 May 2015, the respondent provided a number of drafts of a ‘second’ Third Party - Statement of Claim.
·On 27 May 2015, the Master delivered Reasons for Decision in respect of paragraphs 3 and 4 of the appellant’s application.[13] The Master declined to strike out the then current Third Party Statement of Claim, but gave leave to the respondent to file a third Third Party Statement of Claim.
He reserved his decision in respect of grounds 1 and 2 of the appellant’s application until after that fresh Third Party Statement of Claim was filed.
·On 3 June 2015 the respondent filed the amended third Third Party Statement of Claim.[14] The appellant has not filed a defence to that pleading. It is convenient to set out some of the allegations of the respondent in that pleading.
[13] Document FDN 44. 'Ex Tempore Reasons (No 3)'.
[14] Casebook pgs. 159 - 174.
The third Third Party Statement of Claim
·In the third Third Party Statement of Claim the respondent asserts that the second and third Third Parties were each authorised representatives of the appellant pursuant to s 761A of the Corporations Act, 2001. He asserts that accordingly the appellant is responsible for any loss or damage suffered by the respondent as a result of the conduct of the second and/or third Third Parties, pursuant to s 917C and 917E of the Corporations Act, 2001.
·In paragraph 20 of those pleadings, the respondent asserts that in or about the month of June 2007, Kevin Brown advised the second Third Party, in response to a renewal invitation for the respective policies of insurance, that ‘my son Jonathan is living at the property with his wife and two children’. The second Third Party is alleged to have responded, with words to the effect, ‘I’ll make the adjustment if necessary’.
·In paragraphs 25 to 31, the respondent asserts that he is referred to in the ‘Primary Policy’, in that he is ‘a child of the named insured Kevin and Barbara Brown; and that he normally resided in their home at the property’. Accordingly he is entitled to indemnity pursuant to s 48 of the Insurance Contracts Act, irrespective of any other head of claim. As to the ‘Alternate Policy’, the respondent asserts that his father Kevin Brown was a director of the ‘named insured’ Highbrooke Pty Ltd, and that the respondent similarly fell within the description of ‘family’ for the purpose of that policy.
The respondent claims against the appellant that:
·In paragraph 38 the benefit of the ‘Alternate Policy’.
·In paragraph 39 the benefit of the ‘Legal Liability’ cover in Section 4 of the ‘Alternate Policy’.
·In paragraph 43, that it has wrongly declined to indemnify the respondent in respect of the plaintiff’s claim.
·In paragraph 44, that the appellant owed a duty of care to Kevin Brown to obtain insurance coverage in accordance with his instructions and to act with due care, skill and diligence in advising on the suitability of the respective policies.
·In paragraph 46, in the event that the respondent is not entitled to indemnity from it, the appellant, acted in breach of its duty of care, by failing to secure public liability cover for him, and by failing to advise Kevin Brown and/or the respondent that the latter was not insured for public liability claims.
·In paragraph 47, that the appellant is liable to him for breach of that duty of care as principal of its authorised representatives or agents, the second and third Third Parties.
·In paragraphs 48 and 49B, that in so far as the second or third Third Party engaged in misleading and deceptive conduct contrary to s 52 of the Trade Practices Act 1974 and/or contrary to s 12DA of the Australian Securities and Investment Commission Act 2001, the appellant is liable for their conduct under s 971C and 971E of the Corporations Act.
·In paragraph 52, that in consequence of the breach of duty and/or misleading or deceptive conduct of its authorised agents, the second and third Third Parties, the appellant is liable to the respondent.

The respondent sought as against the appellant –
1A declaration pursuant to s 37 of the District Court Act 1991 that he is entitled to indemnity pursuant to the terms of the respective policies of insurance.
2Damages pursuant to s 82 of the Trade Practices Act for breach of s 52 of the Trade Practices Act 1974 by its authorised representatives, the second and/or third Third Party.
3Damages pursuant to s 12GF of the Australian Securities and Investments Commission Act 2001 for breach by its authorised representatives, the second and/or the third Third Party.
4Damages.
5Costs.
The issues before the Master on the summary judgment application
The principal issues before the Master were:
1.   The proper construction of the policies of insurance issued by the appellant; and, in particular, the construction of the word ‘home’ in the definition of the word ‘family’.
2.   Whether the respondent fell within the meaning of the word ‘family’.
3.   Whether the appellant had satisfied the Court that that there was no reasonable basis for the policy construction pleaded by the respondent.
4.   Did the alternate policy provide no cover because the named insured was the corporate entity Highbrooke Pty Ltd?
5.   If the construction pressed by the appellant was correct, whether there was any discretion vested in the Master to refuse the order for summary judgment.
The Master’s Reasons for Decision
As I have explained, the Master provided separate Reasons for specific paragraphs of the appellant’s interlocutory application. There is no need to detail those other Reasons. The subject Reasons of the Master, dated 26 August 2015, dealt specifically with the question as to whether there was no reasonable basis for the respondent’s claim to indemnity pursuant to the policies.[15]
[15] Decision (No 4) - Casebook pgs, 175 - 184.
The then counsel for the appellant had distinguished between the two policies as to the alleged extended cover for the ‘Home Buildings and Contents’ section. In respect of the ‘Primary Policy’ he noted that the ‘named insureds’ included the respondent’s parents.
This position was to be contrasted with the ‘Alternate Policy’ in that the only ‘named insured’ was the corporate entity Highbrooke Pty Ltd. He submitted that the ‘Alternate Policy’ did not cover the position of the respondent. He was not a ‘child’ of the corporation – he was not the family of the ‘named insured’.
Counsel for the appellant did not however address the Master as to the indemnity in Section 4 of the ‘Alternate Policy’, as a separate source of indemnity for the respondent.
He did however stress that there was a distinction between a ‘house’ on the one hand and a ‘home’, or ‘residence’, on the other. He submitted that a ‘home’ was, on any view, the permanent residence of the insured. As the parents had never lived at the property, but resided permanently elsewhere, the respondent did not ‘normally reside at the [insured’s] home’.
The respondent’s case was that it was not necessary for him to be named in the policy. This was so at common law, and pursuant to s 48 of the Insurance Contracts Act, 1984, (C’wlth).
Counsel for the respondent referred specifically to the ‘Personal Legal Liability’ cover contained in the ‘Home Buildings and Home Contents’, Section 1, of both policies.
He submitted that as, properly construed, the ‘Primary Policy Personal Liability to others’ would read ‘If this section covers your (the named insured’s Kevin and Barbara Brown) ‘Home Buildings’ (defined as a ‘dwelling’ used primarily as a place of ‘residence’ at the said property), we insure ‘you’ and ‘your family’ (including your children (the respondent) who normally live in your home)’.
He submitted that, plainly, it was arguable that the respondent is a child of the named insured who normally lived in the respondent’s ‘home’. He disputed that the word ‘home’ was restricted to the sole permanent residence of the insured. Instead it was akin to the defined ‘home buildings’.
In respect of the ‘Alternate Policy’, he submitted that while the ‘named insured’ was the corporation Highbrooke Pty Ltd, the policy defined ‘you/your to include every director, employee, partner or shareholder while acting in the scope of their duties in such capacity. He explained that the respondent’s father was the sole director of the corporation. He referred to the separate cover for ‘Legal Liability’ in Section 4 of the ‘Alternate Policy’. This section was not restricted to the ‘the home’ or the ‘home buildings’. He submitted that the introduction to that section specifically ‘covers you and your family for your legal liability for injury …’ He submitted that the respondent was clearly a family member of the sole director of the named insured.
The Master at [19] noted that the words ‘home buildings’ were defined as ‘the dwelling primarily used as a place of residence at the farm’.
The Master did not specifically address the submission of the respondent that he was entitled to cover in Section 4 of the ‘Alternate Policy’.
He referred in passing to the ‘Alternate Policy’. He also did not deal specifically with the appellant’s submission that as the ‘named insured’ was a corporate entity, it could not apply to (‘the insured’s’) family.
He did however say, at [50] that the ‘insured’ for the purpose of the ‘Alternate Policy’, were ‘family related companies’.
The Master noted that each policy stated that ‘we insure you and your family against any claim for compensation … arising out of the ownership of the home buildings or occupancy of the home buildings’.
At [31] the Master said that: ‘ultimately if the matter is arguable, I do not consider it appropriate to determine the matter on the summary dismissal application. The trial will proceed in any event on other issues’.
The Master noted that whatever decision he made on the summary judgment application, the appellant would remain a party to the action because of the alternative claims based upon the second and third Third Parties being authorised agents of the appellant. He said that ‘this issue would not in any way relevantly extend the length of the trial … and merely adds an issue … to enable all issues against QBE to be finalised in the one decision’.
He accepted that the respondent did not need to be named as an ‘insured’, and said ‘that arguably he came within the description of a person entitled to indemnity under both policies’.
The Master accepted that the respective policies must be construed in a business-like manner and to give the words ordinary and natural meaning.[16]
[16] Paragraph 69 of the Reasons.
The Master did not accept the submission of the appellant that the definition of ‘family’ was restricted to children who live in the residence ‘with the named insured’. Implicitly he concluded that it was arguable that the expression ‘home’ was simply the dwelling used primarily as a place of residence at the farm, whether by the ‘named insured’ or the family members.
He concluded that the respondent is a member of the Brown family, which family was insured by both policies and that the respondent was at the time living in the home dwelling. He concluded that it is arguable that the ‘Home Buildings and Home Contents’ section of the ‘Primary Policy’ covered occupancy by the Brown family, which included the adult children of Mr and Mrs Brown.
He rejected the appellant’s submission that the fact that the respondent’s parents did not live on the property was fatal to his claim for indemnity.
On the construction which the Master considered arguable, it was not to the point that the parents had never lived on the property, nor that the property itself was not in their names.
The Master concluded that the respondent’s construction of the policy was at least arguable and that in those circumstances it was not appropriate to enter summary judgment for the appellant pursuant to its construction of the policy.
·The Masters Orders
The Master made the following orders in respect of the summary judgment application:
1.   I dismiss that part of the appellant’s application FDN 35 in paragraph 1 and 2.1 seeking summary judgment or for a declaration that the respondent is not entitled to an indemnity.
2.   Leave to the ‘respondent’ to file the third Third Party Statement of Claim.
3.   Time to appeal from this order only operates from the date of these reasons.
4.   Costs in FDN 35 paragraphs 1 and 2.1 reserved.
Notice of Appeal
In its Notice of Appeal dated 15 September 2015, the appellant sought orders that:
1.   That the appeal be allowed.
2.   That order 1 of the Master be set aside.
3. That pursuant to 6R 233 judgment be entered for the appellant in respect of the respondent’s claim for a declaration pursuant to s 37 of the District Court Act that he be entitled to indemnity pursuant to the terms of the ‘Policy or the Alternate Policy’.
4.   Alternatively that pursuant to 6R104 paragraphs 23 to 43 and paragraph 53.1 of the respondent’s Third Party Statement of Claim be struck out.
5.   That the respondent pay the appellant’s costs of and incidental to the application and this appeal.
The grounds of appeal
The appellant asserts in its grounds of appeal:
1.   The Learned Master erred in finding that summary judgment should not be entered for the appellant in relation to the construction of the policy.
2.   Alternatively the Learned Master erred in refusing to strike out paragraphs 23 to 43 and paragraph 53.1 pursuant to Rule 6DCR 104.
3.   The Learned Master:
3.1Erred in failing to find that the first policy was the only policy pursuant to which the defendant might be entitled to indemnity. (This ground was not pursued on the appeal).[17]
[17] Transcript, 23/11/15, p. 5. The question as to whether it is one policy or two, cannot be resolved without further evidence.
3.2Erred in finding that the policies respond to occupancy of the property. (at paragraph [61])
3.3Erred in finding that by living in the home dwelling the defendant came within the definition of family as defined in both policies and was therefore entitled to cover under the policies. (at paragraph [65])
3.4Erred in finding that the defendant was entitled to indemnity under both policies as he fell within the description of the person entitled to indemnity under the policies within the personal legal liability component. (at paragraph [70])
3.5Erred in rejecting the appellant’s argument that the respondent was not entitled to indemnity under either policy because he was not a named insured under either policy nor did he fit within the definition of family as defined in each policy. (at paragraph [71])
3.6Erred in finding that the words ‘with the insured’ were not found in the policies. (at paragraph [71] and
3.7Ought to have found that the respondent is not entitled to indemnity under either policy as he was not a named insured in either policy nor did he fall within the definition ‘family’ appearing in either policy.
Nature of appeal
This appeal is brought pursuant to s 43 of the District Court Act 1991 (SA) and Rule 286 of the District Court Civil Rules 2006 (SA).
286    (1) An appeal is to be by way of rehearing (unless the law under which the appeal is brought provides to the contrary).
(2) Subject to any limitation on its powers arising apart from these Rules, the Court may determine an appeal as the justice of the case requires despite the failure of parties to the appeal to raise relevant grounds of appeal, or to state grounds of appeal appropriately, in the notice of appeal.
(3) Subject to any limitation on its powers arising apart from these Rules, the Court may—
(a)     draw inferences of fact from evidence taken at the original hearing and, in its discretion, hear further evidence on a question of fact;
(b)     amend or set aside the judgment subject to the appeal and give any judgment that the justice of the case requires;
(c)     remit the case or part of the case for rehearing or reconsideration;
(d)     make orders for the costs of the appeal.
The scope of Rule 6DCR 286 has been the subject of differing views and in particular as to whether this Court, on appeal, may interfere with the exercise of a discretion in the absence of any demonstrable error in the reasons of the Master.
In McLean v DID Piling Pty Ltd[18] Layton J referred to various decisions of the Full Court of the Supreme Court that affirmed the need for a Court to find error before exercising the discretion afresh.
[18] [2010] SASC 33.
Her Honour concluded that in respect of the equivalent of Rule 6 DCR 286, a Court on an appeal from the Master ought apply the principles set out by the High Court in House v The King[19]
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the Judges comprising the appellate court consider that, if they had been in the position of the primary Judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the Judge acts upon a wrong principle, if he allow extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary Judges has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case although the nature of the error may not be discoverable, the exercise of the discretion is to be reviewed on the ground that a substantial wrong has in fact occurred.
[19] (1936) 55 CLR 499 at 505.
I note that in recent decisions of the Supreme Court these principles were affirmed.[20]
[20] Adelaide (SA Pools & Spa) Manufacturing and Installation Pty Ltd v Westcourt General Insurance Brokers Pty Ltd [2016] SASC 60 at 22; Groom v State of SA [2017] SASCFC 35 and Tschirn v Australian Executor Trustees Ltd [2015] SASC 58.
The plaintiff, the second and the third Third Parties did not appear on the hearing of the appeal, nor did they provide any written submissions.
Principles of law on Summary Judgment
The subject case is governed by Rule 232(2)(b), as the appellant is, in effect, the defendant in respect of the respondent’s Third Party claim.
That Rule provides that:
Summary judgment may only be given if the court is satisfied:
(a) If the applicant is the plaintiff – there is no reasonable basis for defending the applicant’s claim; or
(b) If the applicant is a defendant – there is no reasonable basis for the claim against the applicant.
That Rule is to be contrasted with Rule 6DCR 193, which provides that the Court may dismiss proceedings, inter alia, if they disclose no reasonable cause of action.
The power to grant summary judgment has been the subject of significant recent authority. That case law was considered by Bleby J in Davies v Minister for Urban Development and Planning;[21] by Stanley J in Mittiga v Community Corporation.[22] By Blue J, in Proude v Visic (No 4),[23]by Parker J in Tschirn v Australian Executor Trustees Limited[24] and by the Full Court of the Supreme Court in the Estate of the Late Sir Donald Bradman v Allens Aurthur Robinson[25]; and in Groom v State of South Australia.[26]
[21] [2011] SASC 87
[22] [2012] SASC 202.
[23] [2013] SASC 154.
[24] [2015] SASC 58.
[25] [2010] 107 SASR 1.
[26] [2017] SASCFC 35.
In Proude v Visic (No 4), supra, Blue J noted that the test in respect of Rule 193 is ‘very high … and the claim must be unsustainable, and so bad that no legitimate amendment could cure the defects … the test for summary judgment under Rule 232 is lower than the test for dismissal under Rule 193’.
In Groom v SA (supra) the Full Court adopted the approach identified in Ceneavenue Pty Ltd v Martin[27] as follows:
While there can be no doubt that paragraph (b) has significantly lightened the burden for a defendant seeking summary judgment, two questions nevertheless remain. The first is what is meant by the expression ‘no reasonable basis’ for the claim against the defendant and second is whether the test is materially different from the test of a real question to be tried. The fact that the expression ‘no reasonable basis’ is used in both paragraphs (a) and (b) of Rule 232(2) suggests that the same test applies both when considering whether there is no reasonable basis for defending the plaintiff’s claim and when considering whether there is no reasonable basis for the claim against the defendant. The test in Rule 232(2) requires the court to first identify the issues to be tried and then to assess whether the claim or defence has reasonable prospects of success. In the case of an application for summary judgment by a plaintiff against a defendant it is doubtful therefore, whether there is a material difference between that test and the former test as it had been expressed in Fancourt. That is because the question whether there is a real question to be tried denoted that the task for the court was to determine whether the issues at the trial are real or fanciful or have reasonable prospects of success.
The question whether there is no reasonable basis for the claim or defence must be determined in a summary way. It is entirely inappropriate for there to be a mini trial on that question. It must, therefore, be evident or obvious that the party defending the application for summary judgment has no reasonable basis for the claim or the defence. While adversarial argument will assist in the determination of that question, the question should be capable of ready resolution without prolonged argument. A prolonged argument might suggest that there is a reasonable basis for the claim or the defence. Comparison with the requirements in rules in other jurisdictions providing for summary judgment confirms these propositions. (my emphasis)
[27] [2008] 106 SASR 1 at 80 - 82.
In the Estate of Late Sir Donald Bradman v Allens Arthur Robinson,[28] the Full Court considered an order for summary judgment which had centred upon the application of the Limitations of Action Act, 1936. The Court, by a majority, concluded that, despite the narrow confines of the issue to be determined, an order for summary judgment, at an early stage in the proceedings, ought not to have been granted because ‘subtle factual and evidential considerations were likely to emerge at trial and be the subject of oral testimony, properly to be tested by cross-examination’.
[28] [2010] 107 SASR 1
In Spencer v Commonwealth,[29] the High Court noted the difference between the equivalent of Rule 6 DCR 232, and the former Rule 25 of the former Rules of Court. The High Court was considering a similar provision, in that case, namely s 31A of the Federal Court of Australia Act, 1976. The plurality said:
First, the central idea about which the provisions pivot is “no reasonable prospect” (emphasis added). The choice of the word “reasonable” is important. If s 31A is to be seen as deriving from r 24.2 of the Civil Procedure Rules 1998 of England and Wales, its provisions underwent an important change in the course of their translation from that jurisdiction to this. The English rule speaks of “no real prospect”; s 31A speak of “no reasonable prospect”. The two phrases convey very different meanings.
Secondly, effect must be given to the negative admonition in subs (3) that a defence, a proceeding, or a part of a proceeding may be found to have no reasonable prospect of successful prosecution even if it cannot be said that it is “hopeless” or “bound to fail”. It will be necessary to examine further the notion of “no reasonable prospect”. But before undertaking that task, it is important to begin by recognising that the combined effect of subs (2) and (3) is that the inquiry required in this case is whether there is a “reasonable” prospect of prosecuting the proceeding, not an inquiry directed to whether a certain and concluded determination could be made that the proceeding would necessarily fail.
…
Because s 31A(3) provides that certainty of failure (“hopeless” or “bound to fail”) need not be demonstrated in order to show that a plaintiff has no reasonable prospect of prosecuting an action, it is evident that s 31A is to be understood as requiring a different inquiry from that which had to be made under earlier procedural regimes. It follows, of course, that it is dangerous to seek to elucidate the meaning of the statutory expression “no reasonable prospect of successfully prosecuting the proceeding” by reference to what is said in those earlier cases.
How then should the expression “no reasonable prospect” be understood? No paraphrase of the expression can be adopted as a sufficient explanation of its operation, let alone definition of its content. It requires a practical judgment … as to whether the applicant has more than a ‘fanciful’ prospect of success. Where there are factual issues capable of being disputed and in dispute summary dismissal should not be awarded to the respondent simply because the court has formed the view that the applicant is unlikely to succeed on the factual issue. Where the success of a proceeding depends upon propositions of law apparently precluded by existing authority, that may not always be the end of the matter. Existing authority may be overruled, qualified or further explained.
…
Summary processes must not be used to stultify the development of the law. But where the success of proceedings is critically dependent upon a proposition of law which would contradict a binding decision of this court, the court hearing the application under s 31A could justifiably conclude that the proceedings had no reasonable prospect of success.
·Summary
[29] (2010) 241 CLR 118 at pgs. 139-141

The test is whether the appellant has established that the respondent has no reasonable basis for his claim for relief. Further it must be evident or obvious that there is no reasonable basis for it, so that it is capable of ready resolution without prolonged argument.
The submissions of counsel on the appeal
·The use of dictionaries
Both counsel concentrated upon the dictionary definitions of the word ‘home’.
It is trite, that in the construction of any word or expression in a contract of insurance, it is necessary to look to its ordinary grammatical meaning, and the context in which it is employed.[30] With the caveat that a dictionary is merely ‘a compendium’ of various meanings, there is abundant authority for the use of such dictionaries as a starting point for the construction of a word. See State Chamber of Commerce and Industry v Commonwealth;[31] and Derrington & Ashton, The Law of Liability Insurance, supra.[32]
[30] Derringon & Ashton - The Law of Liability Insurance, 3rd Ed, Vol 1, Chapter 3 at p. 384.
[31] (1987) 163 CLR 329.
[32] See Footnote 19 at pgs. 381 -382.
Senior Counsel for the appellant, Mr Trim QC; submitted that the word ‘home’ has one plain, unequivocal meaning in the English language, and that is ‘where one lives’. He submitted that it must be distinguished from the words ‘house’ or ‘dwelling’; and that its plain meaning is ‘the permanent or fixed residence of the insured’.
He referred to the ‘New Shorter Oxford English Dictionary on Historical Principles’ (Oxford) at p 1251; and the ‘Collins Concise Dictionary of the English Language’ (Collins, Australian ED; 1982) at p 535.
Counsel for the respondent, Mr Lindsay, submitted that the approach of the appellant was erroneous because it relied upon the selection of one of a number of definitions of the word ‘home’. He referred to the definition in the Macquarie Dictionary of a ‘home’ as ‘a dwelling place, house, abode, the fixed residence of a family or household’.
He submitted that when seen in context, the policies themselves employed a number of expressions including ‘home buildings’, which expression was defined, in the policy, as a ‘dwelling used primarily as a place of residence’.
In addition it used the expression ‘your primary residence’ as contrasted with the word ‘residence’. This he submitted was significant as the policy extended cover when the ‘residence’, or ‘home’ was the insured’s ‘primary residence’.
This he submitted was consistent with the proposition that an insured may have a number of ‘residences’ or ‘homes’[33], but will only be granted the ‘extended cover’ when it is the ‘primary residence’ or ‘primary home’.
[33] See various US authorities in Derrington & Ashton, supra, 3rd Ed, Vol 2 at pgs 2526 and 2527 to the effect that an insured may have several residences.
Accordingly he submitted that the word ‘home’ ought not be construed as the primary or permanent residence of the ‘insured’. He submitted that the ‘home’ is akin to ‘a dwelling used primarily as a place of residence’. Accordingly this expression ‘your home’ does no more than identify the specific homestead on the subject property and limit those who will have the benefit of the insured’s cover to those family members who normally reside there. He submitted that the word ‘home’ is not directed to the ‘named insured’ at all, as the insured is already covered irrespective of where he resides. By inference this construction ensures that only those children who normally live in the insured’s homestead receive the benefit, not those who reside at another of the insured’s residences.
Discussion
As is plain from the respective submissions of counsel, while dictionaries offer a ‘reasonably authoritative source for describing the meanings of a word they often do not speak with one voice’. This is because the task of the Court is to determine the meaning of a word – in this case ‘home’ in the context of a specific insurance contract.
In a different context in House of Peace Pty Ltd v Bankstown City Council,[34] Mason P said of the role of dictionaries at [25]-[32]:
The primary judge's use of the dictionaries is criticised by the appellants as reflecting a search for a majority position and a preference for the narrower, less inclusive definitions over the broader if less generally used meanings.
It has been said that "words are only pictures of ideas on paper" (Isaacs J in Fell v Fell [1922] HCA 55; (1922) 31 CLR 268 at 276, citing Wilmot CJ in Dodson v Grew [1767] EngR 23; (1767) Wilm 272 at 278[1767] EngR 23; , 97 ER 106 at 108). Jackson J once remarked that "dictionaries are the last resort of the baffled judge" (Jordan v De George [1951] USSC 76; 341 US 223, 234 (1951)).
Nevertheless, dictionaries are frequently used, and this approach to statutory interpretation has support from the highest authority (see, eg State Chamber of Commerce and Industry v Commonwealth [1987] HCA 38; (1987) 163 CLR 329 at 348). Few judges emulate Lord Wilberforce, who never used dictionaries for the purpose of determining the common understanding of words and shut his ears if they were referred to in court (see Bennion, Statutory Interpretation 3rd ed, 1997 p946).
A dictionary may offer a reasonably authoritative source for describing the range of meanings of a word, including obsolete meanings. Dictionaries recognise that usage varies from time to time and place to place. However, they do not speak with one voice, even if published relatively concurrently. They can illustrate usage in context, but can never enter the particular interpretative task confronting a person required to construe a particular document for a particular purpose. I agree with the following remarks of Judge Randolph of the United States Court of Appeals for the District of Columbia Circuit ("Dictionaries, Plain Meaning, and Context in Statutory Interpretation" (1994) 17 Harv Jo L PP 71 at 72):
...citing ... dictionaries creates a sort of optical illusion, conveying the existence of certainty - or "plainness" - when appearance may be all there is. Lexicographers define words. Words in the definition are defined by more words, as are those words. The trail may be endless; sometimes, it is circular. Using a dictionary definition simply pushes the problem back.
The limitations of dictionaries are discussed with magisterial clarity by Mahoney JA in Provincial Insurance Australia Pty Ltd v Consolidated Wood Products Pty Ltd (1971) 25 NSWLR 541 at 560-1. Because the passage is lengthy I do not set it out. However, I respectfully agree with what his Honour has written there.
…
The Macquarie Dictionary was first published in 1981. One of its Prefaces discusses the need for an Australian Dictionary. It explains the sense in which that publication was the first general reference dictionary offering a comprehensive survey of Australian English. This should caution against undiscriminating selection from the body of material set out above. It certainly cautions against undiscerning aggregation.
[34] See House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44.
There is some case law which supports both submissions. Some define a ‘home’ as a ‘residence’ or ‘dwelling’. Some stress the difference between a ‘home’, and a ‘principal home’, or ‘principal residence’. See Herbert v Byrne;[35] Langford Property Co Ltd v Athanassoglou;[36] Gray v Mercantile Mutual Insurance (Australia) Ltd,[37] where by contrast the policy definition of ‘home building’ was the ‘principal and primary’ residence; Queensland Building Services Authority v The Proprietors of ‘The View’;[38] Todd v Nichol;[39] Hampstead Way Investments v Lewis-Weare.[40]
[35] (1964) 1 All ER 882.
[36] (1948) 2 All ER 722.
[37] Unreported Decision of Full Court, Mohr, Olsson and Debelle JJ, BC 9405573.
[38] Unreported Decision of (QLD Full Court) Pincus, Thomas and Chesterman JJ.
[39] (1957) SASR 72.
[40] (1985) 1 All ER 564.
The Court however should be loathe to place too much weight on such case law, and even less on foreign case law because the context governing those decisions are often markedly different.
In the subject case there can be little assistance gleaned from the ‘definitions’ of ‘home’ in the various dictionaries.
The submissions
·The appellant
Mr Trim QC submitted that the respondent was not a named insured in respect of either the primary or the alternate policies of insurance. Accordingly the respondent must establish that he is referred to in the policy to obtain the benefit of s 48 of the Insurance Contracts Act. He submitted that he could only obtain that benefit, if he fell within the word ‘family’ as defined in either the ‘Primary Policy’ or the ‘Alternate Policy’.
He repeated his submission that the ordinary and natural meaning of the word ‘home’ is where the insured primarily resides. For the purpose of the ‘Home Buildings and Home Contents’ section of each policy the respondent could only obtain the benefit if ‘he normally lived in ‘your’, Mr and Mrs Brown’s permanent home’.
In considering the proper construction of the terms of the policies, Mr Trim submitted that each policy must be considered separately because the ‘named insured’ in the schedule to each policy determines the scope of the indemnity.
In light of the respondent’s pleading that the named insureds, Mr and Mrs Brown, had never lived at the residence at the said property, he submitted that it could not be their home, and accordingly the respondent does not fall within the definition of ‘family’ as defined in the ‘Home Buildings and Home Contents’ section of either policy. As to the ‘Alternate Policy’ Mr Trim was critical of the Master’s apparent failure to address the fact that the ‘named insured’ was a corporation Highbrooke Pty Ltd. He submitted that the ‘named insured’ could not have a ‘spouse’ nor ‘children’. He submitted that the Master erred in describing them as ‘family companies’ and accordingly the word ‘family’ could not apply to the respondent.
He submitted that ‘you could draw a line under the [Alternate] Policy. It is not on any view arguable that it extends indemnity to an individual’. In reply he referred to the asserted extended indemnity in Section 4 of the ‘Alternate Policy’. He submitted that there was some ambiguity about that section. Unlike Section 1 there was no definition of ‘family’. He submitted that the expression ‘you and your family’, at its highest is confined to directors acting in the scope of their duties to Highbrooke Pty Ltd. He submitted that there was no evidence that this had occurred nor was there any pleading to that effect. The difficulty with that submission is that the application was to be determined on the pleadings. The appellant has not filed a defence. There is no issue whether Mr Brown was so acting. It must be left to trial.
He submitted that the Master had erred in concluding that both policies respond to ‘ownership’ and ‘occupancy’ of the ‘home buildings’. He submitted that those words are merely limiting words, and are not relevant to determining the persons who may have the benefit of the indemnity. Indeed, he submitted that the definition of ‘home buildings’ in each policy also had no relevance to the proper construction of the word ‘family’.
He submitted that the fact that the respondent was living in a building, that may be described as a ‘home buildings’ for the purposes of the respective policies is not to the point.
For the respondent to be entitled to indemnity he, being a child of a named insured, must live in the ‘home’ of the insured. Mr Trim did accept that as each policy did have the same or connected policy number, this issue may potential need to be the subject of specific evidence at the trial. Mr Trim was critical of the finding by the Master that there was no need for the parents Mr and Mrs Brown to reside in the dwelling. On the appellant’s submission, there was no need to consider questions of degree, namely whether the parents had ever spent any time at the property in the past, nor was it relevant as to what they may do in the future.[41]
[41] See Derrington & Ashton, supra, at Vol 2, pgs. 2525 - 2527.
Mr Trim submitted that while the Court may have a residual discretion to refuse an application especially where there were some matters outstanding which would require evidence at trial, the subject case leaves no room for the discretion because the claim for indemnity is untenable. He referred to Esanda Finance Corporation v Peak Marwick Hungerfords.[42] In that case the High Court concluded that if a point, in that case on the pleadings, did not disclose a cause of action it ought be disposed of immediately. Mr Trim submitted that this issue of construction ought be dealt with in advance of the trial.
·The respondent
[42] (1997) 188 CLR 241.
Counsel for the respondent, Mr Lindsay, submitted that the appellant had not established pursuant to Rule 6DCR232(2)(b) that its construction was the only reasonable construction of the respective policies. He concentrated upon the context in which the word ‘family’ was placed. It was he submitted plain that the relevant section of each policy – the ‘Home Buildings and Home Contents’ section was directed to the homestead on the said property. The question of where the ‘insured’ lived is irrelevant. The insured is covered wherever he resides. He submitted that it was at least arguable that the word ‘home’ within the word ‘family’ means no more than that the benefit to the children will only apply when they normally live at the homestead. It limits their entitlement. Unlike the insured they will not be covered if they live at one of the insured’s other homes. He submitted that the word ‘home’ is not used throughout the policy in an all-inclusive way of describing a primary residence but is a synonym for the word ‘home buildings’. He submitted that if one were to give a restrictive construction of the word home, it would lead to there being no work to play for significant parts of the policy.
He submitted that the word ‘home’ should be construed broadly not in the restrictive manner suggested by the appellant. If there were any ambiguity then this should be construed against the appellant.
He referred to the words ‘ownership’ and ‘occupancy’. The latter he submitted, related to the liability as occupier as contrasted with the liability of the owner.[43]
[43] See Hartman v GIO Australia Ltd (1996) BC 09600360.
He asked rhetorically why should the word ‘home’ be restricted to the permanent residence of the insured. The concern of the insurer is not where the insured lives. It is to ensure that the children have a sufficient connection to the property. It would be odd if the children were permanently at the property but could not be entitled to be covered. The appellant’s construction is too restrictive.
He submitted that to achieve the construction submitted by the appellant, there was a need to incorporate additional words such as ‘live with the insured’. He further submitted that the effect of the appellant’s submission was to make the named insured an owner occupier. Such a construction flew in the face of the policy covering the dwelling being let to tenants. He submitted that the proper construction of the alternate policy could not be decided summarily as there was a potential for factual dispute. In any event, its definition of the words ‘you’ and ‘your’ includes ‘every director and executive officer’. There was no doubt that Mr Brown was a director of Highbrooke Pty Ltd. It was open to the Master to conclude that it was reasonably arguable that the ‘Alternate Policy’ in Section 1 did extend to ‘family’.
He submitted that in any event the respondent has a reasonably arguable case that he is covered by the Section 4 – ‘Legal Liability’ of the ‘Alternate Policy’.
Mr Lindsay submitted that there is an ambiguity in the policies which cannot be resolved in the appellant’s favour without evidence. While there is no factual circumstance as yet pleaded by the respondent in the Third Party Statement of Claim, that his parents were acting in the scope of their duties as a director, that is not the end of the matter, and may require evidence at the trial.
In accordance with the decision of the Full Court in the Estate of Bradman v Allens Arthur Robinson[44] this ought be left to the trial.
[44] [2010] 107 SASR 1.
Conclusion
Contrary to the dicta in Spencer v Commonwealth, supra, and Ceneavenue Pty Ltd v Martin, supra, I have set out in detail the respective submissions of counsel on what is clearly a complex question of construction. It is not assisted by some poor drafting of sections of the respective policies. The general principles of construction of a policy of insurance are well settled.
It is trite that a policy of insurance is a commercial contract, and should be given a business like interpretation having regard to the language used by the parties, the commercial circumstances the document addresses, and the objects which it is intended to secure.
See McCann v Switzerland Insurance Australia Ltd.[45]
[45] (2000) 203 CLR 579 at [22].
‘Wherever possible, an absurd or manifestly unjust result will be avoided upon the hypothesis that such would not have been intended by the parties’. See Johnson v American Home Assurance Co.[46]
[46] (1998) 192 CLR 266 at [19].
The respondent in effect submits that it would be an absurd or manifestly unjust result if a ‘child’ of the ‘named insured’, at least for the purpose of the ‘Primary Policy’ could be denied cover notwithstanding that he lived there permanently. This is not a case where there is a doubt whether the child ‘normally lived there’.
In an exceptional case where ‘something has clearly gone wrong with the language so as to interpret it in accordance with the ordinary rules of Syntax makes no commercial sense … a court is entitled to depart from ordinary meaning to give effect to what, objectively speaking, the parties intended’.
See Vero Insurance Ltd v Australian Prestressing Services Pty Ltd.[47]
[47] [2013] NSWCA 181 at [40].
In considering the structure of each of the insuring clauses it is important to have regard to the definition clause in the policy, in this case the ‘home buildings’, the subject of Section 1 of both policies was specifically defined.
The process of construction begins with the insuring clauses. Those clauses should be construed broadly.[48] Whether a term is ambiguous in its context is a matter of law.
[48] Derrington & Ashton, supra, Vol 1 p. 362.
I am conscious of the case law that I should not conduct a mini trial nor should I make a final determination as to the proper construction of the disputed words in the policies of insurances.
In Tschirn v Australian Executor Trustees Ltd[49] Parker J explained that the ‘task of the court is to critically examine the material before the Master to determine whether there is a reasonable basis for the respondent’s claim for indemnity’.
[49] [2015] SASC 58.
There are as I hope that I have explained, significant differences between the ‘Primary Policy’ on the one hand and the ‘Alternate Policy’ on the other. I accept that the Master did not deal with some of the arguments presented by both counsel. I also do not agree with some of his reasons especially those relating to the ‘family companies’.
I have no doubt however that in relation to the ‘Primary Policy’ the respondent does have a reasonable basis for his claim to indemnity. While I must not even attempt to finally resolve the proper construction of the words ‘home’ and ‘family’ in the ‘Home Buildings and Home Contents’ Section 1 of both policies, there is a clear reasonable basis for it to be construed as a ‘dwelling and not as a permanent residence of the insured’.
As to the ‘Alternate Policy’, the submission of the appellant has a great deal more force because the ‘named insured’ is a corporation. I of course appreciate that the respondent submits that this issue should be left to trial because there is a potential factual dispute about whether the respondent’s father, as sole director of the corporation was acting in the course of his duties.

However ultimately I do not need to consider the question further. I also not need consider whether I ought exercise my residual discretion to decline to order summary judgment on any of the issues upon which evidence will be required. This includes the possible question as to whether the two documents are separate policies or simply one policy.
This is because the respondent does in my opinion have a reasonable basis to claim an indemnity pursuant to the Section 4 ‘Legal Liability’ part of the ‘Alternate Policy’.
In my opinion the proper construction of both policies ought to be left to the trial in all respects.
In those circumstances, in my opinion, the appeal must be dismissed.
I will hear the parties as to the question of costs.