Marchand v Jackson - [2013] NZHC 1752

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV 2011-409-810 [2013] NZHC 1752

BETWEEN NICOLA JAYNE MARCHAND and JACQUES RENARD MARCHAND and PATRICK GREGORY COSTELLOE First Plaintiffs

NICOLA JAYNE MARCHAND and JACQUES RENARD MARCHAND Second Plaintiffs

ANDJOHN F JACKSON Defendant

ANDIAG NEW ZEALAND LIMITED Third Party

Hearing: 1-3 July 2013

Counsel: G A Hair for Plaintiffs
B R D Burke for Defendant

Judgment: 11 July 2013

JUDGMENT OF THE HON JUSTICE KÓS (Quantum)

[1] The defendant, Mr Jackson, was the plaintiffs’ insurance broker. Despite repeatedly advising them that he had arranged the insurance of their house through NZI, he had not in fact done so. On 4 September 2010 the house was very badly damaged in the first Christchurch earthquake. It is a write-off.

[2] In my liability judgment,1 I held Mr Jackson liable personally for breach of a contractual duty of care owed to the plaintiffs. I rejected a defence that the risk was
uninsurable because one of the plaintiffs, Dr Marchand, had been convicted of

1 Marchand v Jackson [2012] NZHC 2893.

dishonesty offences in 2008. I held that it was more likely than not that the Marchands would have made full disclosure of this fact had the insurance application forms been provided to them for completion in July 2009. I also held that it was more likely than not that they would then have obtained insurance.2 I rejected a defence of contributory negligence.

[3] I held that the plaintiffs’ loss, for which Mr Jackson is liable, is the amount necessary to put them in the same position as if the insurance cover sought by them had been obtained.3 Trial of liability and quantum having been separated, a further hearing was convened to resolve the latter.

Quantum issues

[4] Eight issues arose in the quantum hearing.

[5] Before addressing those issues I express my appreciation to parties, counsel and the expert witnesses for the extensive and largely successful efforts they engaged in to reach agreement. Primarily on matters of calculation, but also on some significant matters of principle.

Issue 1: What form of policy was likely to have been obtained?

[6] On this issue there was no real contest. Mr Jackson was very close to the insurer, NZI. He sought and obtained 30-day interim cover under an NZI “Echelon Home policy” on 1 July 2009. The grave misfortune for everyone in this case was that Mr Jackson then omitted to confirm cover, so that it lapsed. Cover on that interim basis was as follows:

Echelon wording restricted to $1,500,000 until an ins valuation is received.

[7] After the earthquake, and when Mr Jackson realised the implications of his omission, he purported to issue a backdated cover note for the Marchands’ house on an NZI Echelon Home policy wording. That cover note was limited to 498m2, which
was within Mr Jackson’s direct authority from NZI. That limit is immaterial,

2 At [58]. Notably they had received business and motor vehicle cover from NZI after full disclosure. There…

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.

Continue reading Marchand v Jackson

Details

AGLC: Marchand v Jackson [2013] NZHC 1752
Case: [2013] NZHC 1752
Decision Date: 11 July 2013

CaseChat Overview and Summary

The case of Marchand v Jackson involves the plaintiffs, Nicola Jayne Marchand and Jacques Renard Marchand, who sued their insurance broker, John F Jackson, for failing to secure the insurance for their house, resulting in a total loss due to the Christchurch earthquake. The dispute between the parties centred on the quantum of damages to which the plaintiffs were entitled. The court had to determine eight specific issues related to the insurance policy that the plaintiffs would have likely obtained had the defendant fulfilled his duty as their broker.

The court first considered the form of policy that the plaintiffs would have likely obtained. It was found that the plaintiffs sought and would have obtained an NZI Echelon Home policy. The court then addressed whether the policy would have been capped at either $1,500,000 or 500 m2, concluding that it would not have been limited in that manner. Next, the court determined that the policy would likely have been capped at the insurance valuation of the house. The court also resolved that the insurance value cap in July 2009 would have been $2,525,756, and in September 2010, it would have been $2,626,786. The court found that the policy would not have covered certain disputed items such as marble chips and shingle in the driveway. However, the policy would have allowed recovery for a sustainability upgrade of up to $15,000. The total extent of the defendant's liability to the plaintiffs was found to be $2,686,779.

The court's judgment included declarations and orders regarding the parties' liability and the calculation of interest. Judgment was entered against the defendant in the specified sum. Interest on the first item would run from the date of the judgment, while interest on the second item would run from 30 days after the requisite receipts were tendered. The court reserved the right for the parties to apply for further clarification of quantum issues and reserved costs for later determination.

Orders