AYOUB AND ANOR v LOMBARD INSURANCE CO (AUST) LTD [1992] NSWCA 19

AYOUB AND ANOR v LOMBARD INSURANCE CO (AUST) LTD SUPREME COURT OF NEW SOUTH WALES COMMERCIAL LAW DIVISION

MAHONEY, MEAGHER and CRIPPS JJA 7 October 1992, 14 December 1992

[1992] NSWCA 19

ARSON, INSURANCE CONTRACTS, NON-DISCLOSURE, INSURANCE CONTRACTS ACT, 1984 (CTH).

FACTS: Appellants seek indemnification for their respondent insurers, who claim that fire at appellants' shop was started by them. Respondent also says that they were released from their obligation to pay because of appellants' non-disclosure of fact that another insurer had declined to insure shop. Trial judge finds for respondent on both points.

HELD:(per curiam)

(i) The fact that another insurer had previously declined the appellants wish is a fact that the insured either actually knew to be relevant or could reasonably be expected to know to be relevant. This reduced the liability of the insurer to nil.

(ii) The trial judge, on the strength of the evidence, found that the appellants had deliberately set the fire. He was justified in coming to such a conclusion on the facts which cannot be reversed.

ORDERS:

(1) Appeal dismissed with costs.

Mayne Nickless Ltd v Pegler (1974) 1 NSWLR 229

Toikan International Insurance Broking Pty Ltd v Plasteel Windows Australia

Pty Ltd (NSW Court of Appeal, 13 February 1989, unreported)

Deaves v CML Fire and General Insurance Co (1978-1979) 143 CLR 24

Russell v NRMA Insurance Ltd (NSW Court of Appeal, 1 June 1990, unreported)

Insurance Contracts Act, 1984 (Cth).

Mahoney JA It is accepted that the fire which destroyed the plaintiffs' premises was not accidental. That is clear from the matters to which Meagher JA has referred in his judgment. The essential issue has been whether it should be inferred that it was the plaintiffs who had caused the fire.

The case against them was, in substance, that the fire had started a comparatively short time after they had left the premises, that there was a way or ways in which they could have caused it to start after approximately such an interval, that no-one else was shown to have a reason for starting the fire and, because there was no forced entry, secure door locks and appropriate surrounding lighting, it should not be concluded that a vandal or such person caused the fire.