Global Constructions Australia Pty Ltd (in liq) v AIG Australia Limited (No 3) [2018] FCA 432

FEDERAL COURT OF AUSTRALIA

Global Constructions Australia Pty Ltd (in liq) v AIG Australia Limited (No 3) [2018] FCA 432 File number: NSD 2017 of 2017

Judge: ALLSOP CJ

Date of judgment: 28 March 2018

Legislation: Federal Court of Australia Act 1976 (Cth), ss 37M, 37N

Catchwords: INSURANCE – answering of separate questions – approach to resolution of remaining quantification issues

Cases cited: Global Constructions Australia Pty Ltd (in liq) v AIG Australia Limited [2018] FCA 98 Global Constructions Australia Pty Ltd (in liq) v AIG Australia Limited (No 2) [2018] FCA 100

Date of hearing: 28 March 2018

Registry: New South Wales

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: Commercial Contracts, Banking, Finance and Insurance Insurance List

Category: Catchwords

Number of paragraphs: 15

Counsel for the Applicant: Mr TD Castle

Solicitor for the Applicant: LMI Legal

Counsel for the Respondent: Ms J Thornton

Solicitor for the Respondent: Gilchrist Connell

ORDERS NSD 2017 of 2017

BETWEEN: GLOBAL CONSTRUCTIONS AUSTRALIA PTY LTD (IN LIQ) (ACN 135 598 757) Applicant

AND: AIG AUSTRALIA LIMITED (ABN 93 004 727 753) Respondent

JUDGE: ALLSOP CJ DATE OF ORDER: 28 MARCH 2018

THE COURT ORDERS THAT:

1. The separate questions the subject of order 1 in the orders of 18 December 2017, be answered as follows: Question 1: A claim under cover 1 of Section 4 of the Private Edge policy issued by the respondent to the applicant ("the policy") is, in the case where the person who engaged in the acts of fraud and dishonesty is both an Employee and a Shareholder (within the meaning of the policy), subject to the set-off for which cover 6 of Section 4 provides. Question 2: For the purpose of Section 4 of the policy, the set-off of the amount stated in cover 6, paragraphs (i) and (ii), is to be made against the Direct Financial Loss (within the meaning of the policy) prior to the application of any Limit of liability under the policy. 2. The respondent pay the applicant's costs of the hearing of the separate questions, in the sum of $25,000. 3. Leave be granted to the respondent to issue a subpoena to 4C Consulting Pty Limited of Unit 5, 145 Walcott Street, Mount Lawley, Western Australia in the form initialled and dated today 4. Leave be granted to the respondent to issue a subpoena to Insight Business Partners Pty Limited, trading as ROCG Perth of Level 1, 109 Hay Street, Perth, Western Australia in the form initialled and dated today. 5. Such subpoenas be returnable before a Registrar in Perth on 18 April 2018, with any issues regarding the subpoenas to first be raised with the Registrar in Perth. 6. Leave be granted to file the affidavit of Peter O'Brien sworn 28 March 2018. 7. On or before 13 April 2018, the senior claims manager of the respondent responsible for this claim file and serve an affidavit setting out: (a) whether or not there is an amount presently payable under the policy in the light of the construction of the policy and the communications between the parties; (b) if it is said that there is not, the reason or reasons for that position; (c) if it is said that there is, whether the money had been paid; and (d) if it has not been paid, why it has not been paid. 8. The matter be transferred to Justice Banks-Smith. 9. The matter stood over to a date to be fixed in the week commencing 30 April 2018 or such other date as arranged with the chambers of Justice Banks-Smith for further case management. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.