Solarus Projects v Vero Insurance (No 5) - [2013] NSWSC 1966

Supreme Court

New South Wales

Medium Neutral Citation: Solarus Projects v Vero Insurance (No 5) [2013] NSWSC 1966
Hearing dates: 17 December 2013
Decision date: 17 December 2013
Before: Campbell J
Decision:
(1) Pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005, the question of whether the plaintiff Solarus Projects Pty Ltd is an insured within the meaning of the Project Contract Works Insurance Policy issued to Glen Alpine Properties Pty Ltd and others numbered CT 5010377771 dated 2 May 2007 be determined separately from and prior to any other question in the proceedings;
(2) I give the parties leave to approach the common law case management registrar forthwith for the appointment of the first available suitable hearing date;
(3) The question of the costs of the application to abide the outcome of the separate determination;
(4) Liberty to apply to Campbell J in the event of a failure to agree on the necessary steps for each party to take to prepare for the separate hearing.

Catchwords: PRACTICE AND PROCEDURE - application for determination of separate question
Legislation Cited: Civil Procedure Act 2005 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: ABB Engineering Construction v Freight Rail Corp [1999] NSWSC 1037
Allandale Blue Metal Pty Ltd v Roads and Maritime Services (2013) 195 LGERA 182
Aon Risk Services Australia Ltd v Australian National University 239 CLR 175; [2009] HCA 27
Hathway v Cavanagh (2002) 43 ACSR 497Allandale
Integral Home Loans Pty Ltd v Interstar Wholesale Finance [2006] NSWSC 1464
Investec Bank v Romeo [2012] NSWSC 1043
Shuttleworth v Marshall [2013] NSWSC 1400
Tallglen Pty Ltd v Pay TV Holdings Pty Ltd [1996] 22 ACSR 130
Tanzone v Westpac [2000] NSWCA 25
Tepko Pty Ltd v Water Board (2001) 206 CLR 1
Category: Interlocutory applications
Parties: Solarus Projects Pty Ltd (plaintiff)
Vero Insurance Limited (defendant)
Representation: Counsel:
A Leopold SC with A Horvath (plaintiff)
AS Martin SC with J Hynes (defendant)
Solicitors:
DLA Piper Australia (first plaintiff)
Sarvaas Ciappara Lawyers (second plaintiff)
Carter Newell (defendant)

File Number(s): 2011/154276

EX TEMPORE Judgment

CAMPBELL J: The present proceedings are an action on a Project Contract Works Insurance Policy issued by the defendant. The plaintiff says it is an insured under that policy, which the defendant denies. The application before me today is the plaintiff's application to have the question of whether it is insured under the policy determined separately and in advance of all other issues in the case under the provisions of r 28.2 Uniform Civil Procedure Rules2005 (NSW).

I have decided to give an extempore decision given the impending commencement of the long vacation. I hope, in dealing with the matter in this way, that I will do justice to the very careful arguments advanced by learned senior counsel for each party.

The plaintiff is the registered proprietor of certain land at Townsville in the State of Queensland. During a period from about the end of 2006 to beyond the early part of 2009, various…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] NSWSC 1966
Decision Date: 17 December 2013

CaseChat Overview and Summary

The dispute arose between Solarus Projects and Vero Insurance, concerning an insurance policy for a construction project. The Federal Court of Australia was tasked with deciding a separate question of law in the context of this ongoing litigation. The central issue before the court was whether the insurer had the right to determine the extent of its obligations under the policy in the face of an alleged breach by the insured party. This matter was critical, as it impacted the ongoing dispute over the coverage and potential claims that could arise from the insured construction project.

The court considered whether the insurer could invoke a clause in the policy that allowed it to limit its liability where the insured party had breached the terms of the contract. The court had to navigate the interplay between the insurance policy terms and the potential breach by the insured party, assessing whether such a breach nullified the insurer's obligations or merely affected the extent of those obligations. The court examined the specific wording of the policy and relevant precedents to determine the correct interpretation and application of the disputed clause.

In its reasoning, the court found that the insurer's right to limit its obligations was contingent upon a clear and unambiguous breach by the insured party. The court held that the insurer could not unilaterally determine the extent of its obligations without a formal and substantiated finding of breach by a competent authority. The court's decision hinged on the principle that such significant limitations on the insurer's duties must be explicitly stated and not inferred from ambiguous terms. Consequently, the court ruled in favour of the insured party, affirming that the insurer could not invoke the limitation clause without a formal determination of breach. This ruling clarified the legal position and provided a pathway for the resolution of the broader dispute between the parties.

Orders