Darshn v Avant Insurance Limited [2021] FCA 706

Darshn v Avant Insurance Limited [2021] FCA 706

Written correspondence from the applicant's solicitors to the insurer during the policy period, which detailed the nature of the class action and the risk of Dr Darshn being joined as a defendant, amounted to written notice by the insured of facts that might give rise to a claim under s 40(3) of the Insurance Contracts Act 1984 (Cth); accordingly, the insurer cannot deny cover in respect of the subsequent class action claim against Dr Darshn merely because it arose after policy expiry.

Jurisdiction
Australia
Judgment Date
25 June 2021
Procedural Posture
Originating Application / Judgment After Final Hearing
Outcome
Second contention substantially made out; orders as to form of relief and costs to be submitted by parties. Declaration of indemnity entitlement under policy as per s 40(3) for the lead claim. Other contentions dismissed or not necessary to determine.
Legal Topics
['professional Indemnity Insurance' 'claims Made and Notified Policies' 'section 40(3) Insurance Contracts Act 1984 (cth)' 'duty of Utmost Good Faith' 'notification of Facts That Might Give Rise to a Claim' 'declaratory Relief']
['insurance Law' 'civil Procedure' 'contract Law'] ['professional Indemnity Insurance' 'claims Made and Notified Policies' 'section 40(3) Insurance Contracts Act 1984 (cth)' 'duty of Utmost Good Faith' 'notification of Facts That Might Give Rise to a Claim' 'declaratory Relief']

Case Brief

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Procedural Posture

Originating Application / Judgment After Final Hearing

Legal Issues

  1. 1 ['Whether written notice of facts that might give rise to a claim was given to insurer within the meaning of s 40(3) Insurance Contracts Act 1984 (Cth)' 'Whether the insured is entitled to indemnity in respect of the claims made in the class action' 'Whether insurer breached duty of utmost good faith under s 13 of the Insurance Contracts Act']

Ratio Decidendi

Written correspondence from the applicant's solicitors to the insurer during the policy period, which detailed the nature of the class action and the risk of Dr Darshn being joined as a defendant, amounted to written notice by the insured of facts that might give rise to a claim under s 40(3) of the Insurance Contracts Act 1984 (Cth); accordingly, the insurer cannot deny cover in respect of the subsequent class action claim against Dr Darshn merely because it arose after policy expiry.

Court Disposition

Second contention substantially made out; orders as to form of relief and costs to be submitted by parties. Declaration of indemnity entitlement under policy as per s 40(3) for the lead claim. Other contentions dismissed or not necessary to determine.

Orders

  • ['Within 14 days, applicant and first respondent file any agreed minute of proposed orders to give effect to these reasons and in relation to costs.' 'If parties cannot agree, within 21 days each file and serve minutes of proposed orders and brief outline of submissions.' 'Second respondent has liberty to apply for...