Murphy & Allen v SwinbankSwinbank v Cleary [1999] NSWSC 1098

Murphy & Allen v SwinbankSwinbank v Cleary [1999] NSWSC 1098

It was not strictly necessary to determine the good faith proceedings as the insurers succeeded in the main proceedings. However, the proceedings were addressed in the event of appeal. Cleary & Hoare did not breach the duty of utmost good faith in assigning the year 3 policy, acting on reasonable legal advice and without ulterior motive. The Trustees should succeed on the substance of the good faith proceedings. As to costs, indemnity costs were justified for the insurers (limited to 30%) in respect of year 3 issues from certain dates, and the insurers are to pay two-thirds of the Trustees’ costs of the good faith proceedings, and the Trustees' costs of the insurers’ failed cross-claim.

Jurisdiction
Australia
Judgment Date
16 November 1999
Procedural Posture
Complex Commercial Insurance Litigation / Post Hearing, Determination of Good Faith Proceedings and Costs
Outcome
Orders as to costs—Trustees to pay insurers’ costs of main proceedings (partly indemnity), insurers to pay two-thirds of Trustees’ costs of good faith proceedings, and Trustees’ costs of cross-claim. Short minutes of order to be brought in to record findings and change in parties.
Legal Topics
["insured's Obligation of Utmost Good Faith" 'assignment of Insurance Policies' 'practice and Procedure Costs' 'calderbank Letters']
['insurance Law' 'commercial Law'] ["insured's Obligation of Utmost Good Faith" 'assignment of Insurance Policies' 'practice and Procedure Costs' 'calderbank Letters']

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Procedural Posture

Complex Commercial Insurance Litigation / Post Hearing, Determination of Good Faith Proceedings and Costs

Legal Issues

  1. 1 ['Whether assignment of the 1991/92 policies breached the duty of utmost good faith under section 13 of the Insurance Contracts Act 1984' 'Whether the Trustees were entitled to rectification or rescission of the First Settlement Agreement' 'Whether misleading or deceptive conduct occurred under the Trade Practices Act' 'Appropriate orders as to costs, including indemnity costs']

Ratio Decidendi

It was not strictly necessary to determine the good faith proceedings as the insurers succeeded in the main proceedings. However, the proceedings were addressed in the event of appeal. Cleary & Hoare did not breach the duty of utmost good faith in assigning the year 3 policy, acting on reasonable legal advice and without ulterior motive. The Trustees should succeed on the substance of the good faith proceedings. As to costs, indemnity costs were justified for the insurers (limited to 30%) in respect of year 3 issues from certain dates, and the insurers are to pay two-thirds of the Trustees’ costs of the good faith proceedings, and the Trustees' costs of the insurers’ failed cross-claim.

Court Disposition

Orders as to costs—Trustees to pay insurers’ costs of main proceedings (partly indemnity), insurers to pay two-thirds of Trustees’ costs of good faith proceedings, and Trustees’ costs of cross-claim. Short minutes of order to be brought in to record findings and change in parties.

Orders

  • ['Trustees to pay insurers’ costs of main proceedings—30% on indemnity basis from dates between 2 March 1999 and 29 July 1999, balance on party/party basis.' 'Insurers to pay two-thirds of Trustees’ costs of good faith proceedings.' 'Insurers to pay Trustees’ costs of the cross-claim in the main proceedings.']