Sienkiewicz (As Trustee for the Sienkiewicz Superannuation Fund) v Salisbury Group Pty Limited (in Liquidation) (No 2) [2015] FCA 147

Sienkiewicz (As Trustee for the Sienkiewicz Superannuation Fund) v Salisbury Group Pty Limited (in Liquidation) (No 2) [2015] FCA 147

The policy covered only advice on investment products that were on an Approved Product List at the time the impugned conduct occurred. The investments in question were not on an Approved Product List at the relevant time, thus Mr Todd's liability was not covered. Endorsement No. 002 formed part of the policy, was supported by consideration, and, on proper interpretation, further excluded cover for the disputed investments. Section 54 of the Insurance Contracts Act did not operate to prevent the insurer from refusing indemnity, as the exclusion arose from a bilateral contract variation, not from an act to which s 54 applies.

Jurisdiction
Australia
Judgment Date
06 March 2015
Procedural Posture
Cross Claim (insurance Indemnity) / Judgment After Trial (cross Claim Only)
Outcome
Cross-claim dismissed
Legal Topics
['professional Indemnity Insurance' 'policy Interpretation' 'approved Product Lists' 'exclusion Clauses' 'insurance Contracts Act S 54' 'variation of Insurance Policy' 'consideration in Contract Variation']
['insurance Law' 'contract Law' 'financial Services Law'] ['professional Indemnity Insurance' 'policy Interpretation' 'approved Product Lists' 'exclusion Clauses' 'insurance Contracts Act S 54' 'variation of Insurance Policy' 'consideration in Contract Variation']

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Procedural Posture

Cross Claim (insurance Indemnity) / Judgment After Trial (cross Claim Only)

Legal Issues

  1. 1 ['Whether professional indemnity cover applied to the cross-claimant under the policy for advice given on non-approved investment products.' "Whether 'approved investment products' under the policy required inclusion on an Approved Product List at the relevant time." "Whether an exclusion for dealings 'as principal for own account' applied to the conduct in issue." 'Whether certain exclusions in the policy (including performance guarantee) applied to representations made by the cross-claimant to investors.' 'Whether Endorsement No. 002 (Non-Approved Products Exclusion) was part of the policy/operated to exclude cover and whether it was supported by consideration.' 'Whether s 54 of the Insurance Contracts Act 1984 (Cth) prevented the insurer from refusing indemnity based on the endorsement.']

Ratio Decidendi

The policy covered only advice on investment products that were on an Approved Product List at the time the impugned conduct occurred. The investments in question were not on an Approved Product List at the relevant time, thus Mr Todd's liability was not covered. Endorsement No. 002 formed part of the policy, was supported by consideration, and, on proper interpretation, further excluded cover for the disputed investments. Section 54 of the Insurance Contracts Act did not operate to prevent the insurer from refusing indemnity, as the exclusion arose from a bilateral contract variation, not from an act to which s 54 applies.

Court Disposition

Cross-claim dismissed

Orders

  • ["The cross-claimant's cross-claim against the cross-respondents be dismissed." 'Costs be reserved.']