WESFARMERS FEDERATION INSURANCE LTD v STEPHEN WELLS trading as WELLS PLUMBING [2008] NSWCA 186

WESFARMERS FEDERATION INSURANCE LTD v STEPHEN WELLS trading as WELLS PLUMBING [2008] NSWCA 186

Mr Hubbard was not running his own business and, considering the level of control, absence of business setup, and the manner of the financial and working arrangements, was an employee of Mr Wells at the relevant time. As such, the injury was not covered under the policy for damages, but Wells was entitled to indemnity from Wesfarmers for legal costs incurred in defending the claim, as the claim was within the policy on its face and effective consent to incur such costs was provided by the insurer’s conduct.

Parties
Appellant/cross Defendant: Wesfarmers Federation Insurance Ltd; First Respondent/cross Claimant/cross Appellant/defendant: Stephen Wells t/as Wells Plumbing; Second Respondent/plaintiff/cross Respondent: Adam Luke Hubbard
Jurisdiction
Australia
Judgment Date
11 August 2008
Procedural Posture
Appeal and Cross Appeal / Judgment on Appeal From District Court
Outcome
Appeal allowed in part; cross-appeal allowed; orders of District Court varied as specified.
Legal Topics
Employment Vs Independent Contractor, Legal Costs Under Insurance Policy, Indemnity Clauses, Personal Injury Liability, Characterisation of Work Relationship
Employment Law Insurance Law Tort Law Civil Procedure Employment Vs Independent Contractor Legal Costs Under Insurance Policy Indemnity Clauses Personal Injury Liability +1 more

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Parties

Wesfarmers Federation Insurance Ltd

Appellant/cross Defendant

Stephen Wells t/as Wells Plumbing

First Respondent/cross Claimant/cross Appellant/defendant

Adam Luke Hubbard

Second Respondent/plaintiff/cross Respondent

Procedural Posture

Appeal and Cross Appeal / Judgment on Appeal From District Court

Legal Issues

  1. 1 Whether Mr Hubbard was an employee or independent contractor at the time of injury
  2. 2 Whether Wells was entitled to indemnity from insurer for court-awarded damages and/or legal costs under the insurance policy

Ratio Decidendi

Mr Hubbard was not running his own business and, considering the level of control, absence of business setup, and the manner of the financial and working arrangements, was an employee of Mr Wells at the relevant time. As such, the injury was not covered under the policy for damages, but Wells was entitled to indemnity from Wesfarmers for legal costs incurred in defending the claim, as the claim was within the policy on its face and effective consent to incur such costs was provided by the insurer’s conduct.

Court Disposition

Appeal allowed in part; cross-appeal allowed; orders of District Court varied as specified.

Orders

  • Set aside District Court orders giving judgment for Wells against Wesfarmers and awarding Wells his costs from Wesfarmers.
  • Declare Wells entitled to indemnity from Wesfarmers limited to costs incurred in defending Hubbard's claim; otherwise dismiss cross-claim.