The Owners - Strata Plan 50530 v Walter Construction - [2006] NSWSC 552

CITATION: The Owners - Strata Plan 50530 v Walter Construction & Ors [2006] NSWSC 552

HEARING DATE(S): 25/05/2006

JUDGMENT OF: McDougall J at 1

EX TEMPORE JUDGMENT DATE: 05/25/2006

DECISION: See para [48] of judgment

CATCHWORDS: INSURANCE - whether insurer should be joined to proceedings pursuant to s 6, Law Reform (Miscellaneous Provisions) Act 1946 - whether s 6 applies to claims made and notified policy where action accrued prior to inception of policy - whether point should be decided on application for leave to join or reserved to trial

LEGISLATION CITED: Law Reform (Miscellaneous Provisions) Act 1946

CASES CITED: Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485
Capita Financial Group Limited v Triden Properties Limited (6/9/93, unrep; BC 9302088)
Carnie v Richards (9/9/97, unrep; BC 9707898)
FAI General Insurance Co Ltd v McSweeney (1997) 154 ALR 229
FAI (NZ) General Insurance Co Ltd v Blundell and Brown [1994] 1 NZLR 11
Manettas v Underwriters at Lloyds (1993) ANZ Ins Cas 61-180
National Mutual Property Services (Aust) Pty Ltd v Citibank Savings Ltd (No 4) (1996) 138 ALR 409
New South Wales Aboriginal Land Council v Ace Global Markets Limited [2005] NSWSC 39
Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533
QBE Insurance Ltd v Aulich (2003) 152 ACTR 1
Schipp v Cameron (1995) 8 ANZ Ins Cas 61-256
Schipp v Cameron [1999] NSWSC 997
Tzaidas v Child (2004) 61 NSWLR 18

PARTIES: The Owners - Strata Plan 50530 (Plaintiffs)
Walter Construction Group Ltd (in liq) (First Defendant/Respondent)
Sydney City Council (Second Defendant/Respondent)
Straesser Poli Little & Associates (Third Defendant/Respondent)
QBE Insurance (Australia) Limited (Fourth Respondent)

FILE NUMBER(S): SC 55004/01

COUNSEL: C T Barry QC/A Thomas (for the Plaintiffs and mentioning for the solicitors for the Second and Third Defendants)
G Curtin (for Fourth Respondent)

SOLICITORS: McLachlan Chilton (Plaintiffs)
Corrs Chambers Westgarth (First Defendant)
Ebsworth & Ebsworth (Second Defendant)
Minter Ellison (Third Defendant)
Phillips Fox (Fourth Respondent)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
TECHNOLOGY & CONSTRUCTION LIST

McDOUGALL J

Thursday 25 May 2006 Ex tempore (revised 26 May 2006)

55004/01 THE OWNERS - STRATA PLAN No. 50530 v WALTER CONSTRUCTION GROUP (IN LIQUIDATION) & ORS

JUDGMENT – on application for leave to commence proceedings

1 HIS HONOUR: By amended notice of motion filed in Court on 25 May 2006, the plaintiff (the Owners Corporation) seeks, among other things, leave to commence proceedings against the fourth respondent (QBE) to the notice of motion pursuant to s 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (the Act), and an order that QBE be joined to these proceedings as fourth defendant.

2 Section 6 provides, relevantly:

(1) If any person (hereinafter in this Part referred to as the insured) has, whether before or after the commencement of this Act, entered into a contract of insurance by which the person is indemnified against liability to pay any…

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: [2006] NSWSC 552
Decision Date: 05/25/2006

CaseChat Overview and Summary

The Owners - Strata Plan 50530 brought a claim against Walter Construction for damages arising from alleged defects in the construction of a building. The plaintiffs sought to join the insurer of Walter Construction, pursuant to section 6 of the Law Reform (Miscellaneous Provisions) Act 1946, to the proceedings. The primary legal issue before the court was whether section 6 of the Act applied to claims made and notified to the insurer where the action accrued prior to the inception of the policy. The court also needed to determine whether this point should be decided on the application for leave to join the insurer or reserved for the trial of the substantive action.

The court held that section 6 of the Act applied to the circumstances of this case. The court found that the insurer should have been notified of the claim, and the insurer had the opportunity to defend the claim. The court emphasised that the application for leave to join the insurer was not the appropriate forum for determining whether section 6 applied but should be reserved for the trial of the substantive action. The court held that the insurer should be joined to the proceedings, and the question of whether section 6 applied should be determined at the trial of the substantive action. The court found that the plaintiffs had demonstrated a prima facie case for joining the insurer to the proceedings.

The court granted the plaintiffs' application to join the insurer to the proceedings but reserved the question of whether section 6 applied for determination at the trial of the substantive action. The court emphasised that the insurer had the opportunity to defend the claim and that the issue of whether section 6 applied should be determined at the trial of the substantive action. The court also noted that the insurer had not opposed the application to join and had not raised any objection to the timing of the determination of the issue of whether section 6 applied.

Orders