RASO v NRMA INSURANCE LTD T/AS NRMA HOME INSURANCE [1992] NSWCA 202

RASO v NRMA INSURANCE LTD T/AS NRMA HOME INSURANCE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MAHONEY, PRIESTLEY and HANDLEY JJA 14 and 15 July 1992, 14 December 1992

[1992] NSWCA 202

FIRE INSURANCE — arson. INSURANCE — contract of indemnity — sum insured — insured only entitled to indemnity. EVIDENCE — privilege against self-incrimination — claim of privilege — adverse inference not to be drawn.

The appellants held fire policies covering a holiday home and its contents which were destroyed by fire. The insurer claimed that the appellants had been privy to the arson. The trial Judge upheld this defence. On appeal - Held (1) Reliance by the male appellants on the privilege against self-incrimination in relation to their income tax affairs did not entitle the trial Judge to draw adverse inferences against them. "Taking the Fifth" (1991) 65 ALJ 412 approved. (2) Disbelief of the appellants' evidence by the trial Judge did not furnish evidence to the contrary supportive of the insurer's case. (3) The trial Judge had failed to properly consider whether the appropriate conclusion on all the evidence was that the insurer had failed to discharge the onus of proof. (4) The evidence before the Court did not support the trial Judge's conclusion that the appellants were privy to the arson. (5) Damages must be assessed on the basis that was most beneficial to the insurer. Because the policy was a contract of indemnity the insured were not entitled to the sum insured but only to the lesser figure representing the loss of market value due to the fire.

Mahoney JA I agree with the judgment of Handley JA and the orders proposed.

Priestley JA I have had the benefit of reading Handley JA's reasons in draft. For the reasons he gives, I agree that the appeals should be allowed and judgments entered in favour of the appellants.