Permanent v FAI [2001] NSWCA 20

(2001) 50 NSWLR 679 (2001) 160 FLR 435 Reported Decision : (2001) 11 ANZ Ins Cas 61-491 [2001] ACL Rep 15 NSW 2 [2001] ACL Rep 235 NSW 5

New South Wales Court of Appeal

CITATION : Permanent v FAI [2001] NSWCA 20 FILE NUMBER(S) : CA 40332/98 HEARING DATE(S) : 29/01/01, 30/01/01, 31/01/01, 01/02/01, 02/02/01 JUDGMENT DATE : 12 March 2001

Permanent Trustee Australia Company Limited & Anor PARTIES : v FAI General Insurance Company Limited JUDGMENT OF : Meagher JA at 1; Handley JA at 2; Powell JA at 153

LOWER COURT JURISDICTION : Supreme Court - Equity Division LOWER COURT ED 3032/96; ED 3037/96 FILE NUMBER(S) : LOWER COURT Hodgson CJinEq JUDICIAL OFFICER :

COUNSEL : R J Ellicott QC/J C Campbell QC/J Svehla (Appellants) C J Gee QC/G Inatey SC (Respondent) SOLICITORS : Church & Grace (Appellants) Colin Biggers & Paisley (Respondent) CATCHWORDS : AGENCY - agent to effect contract - knowledge of principal relevant if contract made by principal - knowledge of agent relevant if contract made by agent - knowledge relevant however acquired - FRAUD - representation - representor intended one meaning - representee to knowledge of representor takes different meaning - different meaning false to knowledge of representor - representor fails to correct representee's mistake - fraud established - INSURANCE - Insurance Contracts Act 1984 (Cth) - duty of disclosure - definition of knowledge - knowledge of agent to insure attributable to principal - negligent misrepresentation - misrepresentation by omission or silence - fraudulent misrepresentation and non-disclosure - KNOWLEDGE - whether belief equivalent to knowledge LEGISLATION CITED : Insurance Contracts Act 1984 (Cth) Marine Insurance Act 1909 (Cth) Advance (NSW) Insurance Agencies Pty Limited v Matthews (1989) 166 CLR 606 Barclay Holdings (Australia) Pty Limited v British National Insurance Co Ltd (1987) 8 NSWLR 514 CA Mayne Nickless v Pegler [1974] 1 NSWLR 228 Toikan International Insurance Broking Pty Ltd v Plasteel Windows Australia Pty Ltd (1989) 94 FLR 362 Ayoub v Lombard Insurance Co (Aust) Pty Ltd (1989) 97 FLR 284 Twenty-First Maylux Pty Limited v Mercantile Mutual Insurance (Australia) Ltd [1990] VR 919 Macquarie Bank Ltd v National Mutual Life Association of Australia Ltd (1996) 40 NSWLR 543 Commercial Union Assurance Company of Australia Ltd v Beard (1999) 11 ANZ Cas 75250 Bolton ex parte Beane (1987) 162 CLR 514 Australian Casualty and Life Ltd v Hall (1999) 151 FLR 360 Lustre Hosiery Limited v York (1935) 54 CLR 134 Sharpe v Smail (1975) 49 ALJR 130 Shannon v Whiting (1900) 26 VLR 392 Gilchrist v R Wallace Mitchell Pty Ltd [1972] VR 481 Lyell v Kennedy (No 2) (1883) 9 App Cas 81 Blackburn Low & Co v Vigors (1886) 17 QBD 553 Derry v Peek (1889) 14 App Cas 337 Baden v Societe Generale S.A. [1993] 1 WLR 509 Coastal Estates Pty Ltd v Melevende [1965] VR 433 Insurance Corporation of the Channel Islands v The Royal Hotel [1998] 1 Lloyds LR (I & R) 151 Lindsay & Ors v CIC Insurance Ltd (1989) 16 NSWLR 673 CASES CITED: Banque Keyser Ullmann SA v Skandia (UK) Insurance Co Ltd [1990] 1 QB 665 Blackburn Low & Co v Haslam (1888) 21 QBD 144 El Ajou v Dollar Holdings plc [1994] 2 All ER 685 Dresser v Norwood (1864) 17 CB (NS) 466 [144 ER 188] Deutsche Ruckversicherung AG v Walbrook Insurance Co Ltd [1995] 1 WLR 1017 Societe Anonyme d'Intermediaries Luxembourgeois v Farex Gie [1995] Lloyd's RLR 116 P.C.W. Syndicates v P.C.W. Reinsurers [1996] 1 WLR 1136 Jessett Properties Ltd v UDC Finance Ltd [1992] 1 NZLR 138 Taylor v Yorkshire Insurance Co Ltd [1913] 2 IR 1 Demagogue Pty Limited v Ramensky (1992) 39 FCR 31 Hamilton v Watson (1845) 12 Cl & Fin 109 Lee v Jones (1864) 17 CB NS 482 Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447 Nocton v Ashburton [1914] AC 932 Akerheilm v DeMare [1959] AC 789 Abalos v Australian Postal Commission (1990) 171 CLR 167 Coghlan v Cumberland [1898] 1 Ch 704 Spence v Crawford [1939] 3 All ER 271 HL Smith Newcourt Securities v Scrimgeour Vickers (Asset Management) Ltd [1997] AC 254 Krakowski v Eurolynx Properties Limited (1995) 183 CLR 563 Jones v Dumbrell [1981] VR 199 Burns v MMI-CMI Insurance Ltd (1994) 8 ANZ Ins Cas 61-228 Thompson v Government Insurance Office of New South Wales, 15/6/94, unrep DECISION : Appeal dismissed with costs; Cross-appeal allowed in part with costs.