Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610

Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610

Leave to join Lawcover was refused because the proposed third cross-claim did not properly plead a negligence case against AXL Legal Solutions Pty Ltd. In particular, it failed to identify the relevant risk of harm, the reasonable precautions said to have been required, and the basis for factual causation under the Civil Liability Act 2002 (NSW). Those deficiencies meant the applicants had not established a reasonably arguable cause of action against the insured so as to enliven the discretion under s 5 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW). In any event, because the claim was not properly articulated and it was unclear whether the policy would...

Jurisdiction
Australia
Judgment Date
20 November 2019
Procedural Posture
Civil Procedure; Application for Joinder of Insurer as Cross Defendant and Leave Under S 5 of the Civil Liability (third Party Claims Against Insurers) Act 2017 (nsw) / Interlocutory Notice of Motion Filed 16 August 2019, Heard 5 November 2019, Determined 20 November 2019
Outcome
Application dismissed; leave for joinder refused with costs.
Legal Topics
['joinder of Parties' 'third Party Claims Against Insurers' 'professional Indemnity Insurance' 'reasonably Arguable Cause of Action' 'pleading Negligence Under the Civil Liability Act 2002 (nsw)' 'risk of Harm' 'trust Property and Alleged Breach of Trust']
['civil Procedure' 'insurance' 'professional Negligence' 'equity' 'trusts'] ['joinder of Parties' 'third Party Claims Against Insurers' 'professional Indemnity Insurance' 'reasonably Arguable Cause of Action' 'pleading Negligence Under the Civil Liability Act 2002 (nsw)' 'risk of Harm' 'trust Property and Alleged Breach of Trust']

Case Brief

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Procedural Posture

Civil Procedure; Application for Joinder of Insurer as Cross Defendant and Leave Under S 5 of the Civil Liability (third Party Claims Against Insurers) Act 2017 (nsw) / Interlocutory Notice of Motion Filed 16 August 2019, Heard 5 November 2019, Determined 20 November 2019

Legal Issues

  1. 1 ['Whether leave should be granted under s 5 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW) to join Lawcover Insurance Pty Ltd as a cross-defendant.' 'Whether DK Excavation and Concreting Pty Ltd and IWC Industries Pty Ltd established an arguable case as to the liability of AXL Legal Solutions Pty Ltd.' "Whether there was an arguable case that Lawcover's run-off professional indemnity policy responded to the proposed claim against AXL Legal Solutions Pty Ltd." 'Whether there was a real possibility that AXL Legal Solutions Pty Ltd, being deregistered, would not be able to meet any judgment.' 'Whether the proposed third cross-claim adequately pleaded negligence, including the risk of harm, reasonable precautions and causation under the Civil Liability Act 2002 (NSW).']

Ratio Decidendi

Leave to join Lawcover was refused because the proposed third cross-claim did not properly plead a negligence case against AXL Legal Solutions Pty Ltd. In particular, it failed to identify the relevant risk of harm, the reasonable precautions said to have been required, and the basis for factual causation under the Civil Liability Act 2002 (NSW). Those deficiencies meant the applicants had not established a reasonably arguable cause of action against the insured so as to enliven the discretion under s 5 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW). In any event, because the claim was not properly articulated and it was unclear whether the policy would...

Court Disposition

Application dismissed; leave for joinder refused with costs.

Orders

  • ['Refuse leave for the joinder of Lawcover Insurance Pty Ltd and dismiss the notice of motion filed 16 August 2019 with costs.']