FAI General Insurance Co Ltd v McSweeney, Brian Albert & Ors Travel Compensation Fund v FAI General Insurance Co Ltd (Part I) [1997] FCA 152

FAI General Insurance Co Ltd v McSweeney, Brian Albert & Ors Travel Compensation Fund v FAI General Insurance Co Ltd (Part I) [1997] FCA 152

The statutory charge under s 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) applies to insurance money that becomes payable, even under claims made and notified policies entered after the event giving rise to liability. Leave was not granted to TCF, as TCF had not established it was less likely to recover judgment against PMS absent leave (discretion exercised against leave), and the insureds were actively litigating indemnity claims against FAI.

Jurisdiction
Australia
Judgment Date
12 March 1997
Procedural Posture
Insurance, Commercial Law / Reasons for Judgment (part I)
Outcome
Leave to bring action against insurer under s 6 Law Reform (Miscellaneous Provisions) Act refused as a matter of discretion; substantive insurance issues remain for determination between insureds and FAI.
Legal Topics
['claims Made and Notified Policy' 'statutory Charge Under S 6 Law Reform (miscellaneous Provisions) Act 1946 (nsw)' 'duty of Disclosure' 'misrepresentation' 'breach of Utmost Good Faith' 'indemnity' 'waiver and Estoppel']
['insurance Law' 'commercial Law'] ['claims Made and Notified Policy' 'statutory Charge Under S 6 Law Reform (miscellaneous Provisions) Act 1946 (nsw)' 'duty of Disclosure' 'misrepresentation' 'breach of Utmost Good Faith' 'indemnity' 'waiver and Estoppel']

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Procedural Posture

Insurance, Commercial Law / Reasons for Judgment (part I)

Legal Issues

  1. 1 ['Whether s 6 Law Reform (Miscellaneous Provisions) Act applies to claims made and notified policies entered after the event giving rise to insured liability' 'Whether TCF should be granted leave to bring action against FAI' 'Whether FAI validly avoided policies or reduced liability due to fraudulent non-disclosure or misrepresentation' 'Whether insured breached duty of utmost good faith' 'Whether insurer affirmed or waived right to avoid policies']

Ratio Decidendi

The statutory charge under s 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) applies to insurance money that becomes payable, even under claims made and notified policies entered after the event giving rise to liability. Leave was not granted to TCF, as TCF had not established it was less likely to recover judgment against PMS absent leave (discretion exercised against leave), and the insureds were actively litigating indemnity claims against FAI.

Court Disposition

Leave to bring action against insurer under s 6 Law Reform (Miscellaneous Provisions) Act refused as a matter of discretion; substantive insurance issues remain for determination between insureds and FAI.

Orders

  • ['Leave is refused to Travel Compensation Fund to commence action against FAI General Insurance Co Limited under s 6(4) Law Reform (Miscellaneous Provisions) Act 1946 (NSW)' "TCF to pay FAI's costs of application for leave to the extent incurred due to TCF's participation"]