Brescia v QBE [2007] NSWSC 598

Reported Decision : (2007) 14 ANZ Insurance Cases 61-740

New South Wales Supreme Court

CITATION : Brescia v QBE [2007] NSWSC 598 This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S) : 28th, 29th, 30th, 31st May, 4th, 5th, 6th, 7th ,8th, 12th, 13th, 14th, 15th, 22nd, 26th June 2007

JUDGMENT DATE : 6 July 2007

JUDGMENT OF : Hammerschlag J

DECISION : Verdict for the plaintiff

CATCHWORDS : INSURANCE – Industrial special risk policy providing cover against property damage and consequential loss of profits – property destroyed by fire – refusal of indemnity by insurer on basis of insured's failure to take reasonable precautions as required by the policy and on basis of s56(1) Insurance Contracts Act 1984 (Cth) for fraudulent stock and business interruption claims – insured seeks damages for breach – whether insured took reasonable precautions and test to be applied – whether fraud established in stock and business interruption claims – whether reinstatement value, indemnity value or difference between market value before and after event applies – quantifying loss – extent of insured's obligation to act with reasonable dispatch after termination of policy by effluxion of time – availability of consequential damages where policy not terminated for breach

LEGISLATION CITED : Insurance Contracts Act 1984 (Cth)

Stuart v Guardian Royal Exchange Assurance of New Zealand Limited (No.2) (1988) 5 ANZ Insurance Cases 60-844 Moss v Sun Alliance Australia Limited (1990) 55 SASR 145 Kodak (Australasia) Pty Limited v Retail Traders Mutual Indemnity Insurance Association (1942) 42 SR (NSW) 231 Legal & General Insurance Australia Limited v Eather (1986) 6 NSWLR 390 Brambles Holdings Ltd v Carey (1976) 15 SASR 270 Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563 VACC Insurance Ltd v BP Australia Ltd (1999) 47 NSWLR 716 Entwells Pty Ltd v National and General Insurance Co Ltd (1991) 5 ACSR 424 Fraser v BN Furman (Productions) Limited; Miller Smith & Partners (A firm) Third Party [1967] 1 WLR 898 Albion Insurance Company Limited v Body Corporate Strata Plan No. 4303 [1983] 2 VR Plasteel Windows Australia Pty Limited v Sun Alliance Insurance Limited (1989) 5 ANZ Ins Cas 60-918 Caff v McHenland Nominees Pty Limited (t/a Confoil Containers) (1984) 3 ANZ Ins Cas 60-575 The Committee for the time being of the Casino Show Society v Lyn Maree Norris (1984) 3 ANZ Ins Cas 60-580 Aluminium Wire & Cable Co Limited v Allstate Insurance Co Limited [1985] 2 Lloyd's Rep 280 Cee Bee Marine Ltd v Lombard Insurance Co Ltd [1990] 2 NZLR 1 Haines House Haulage Co v Goldstar Insurance Co (1989) 5 ANZ Ins Cas 60-937 Mason v Century Insurance Co Ltd [1973] 2 NZLR 216 Hing v Security & General Insurance Company (N.Z.) Ltd (1985) 4 ANZ Ins Cas 60-696 Kelly v The National Insurance Company of New Zealand Ltd (1995) 8 ANZ Ins Case 61-239 Jones v Dunkel (1959) 101 CLR 298 Ghazal v Government Insurance Office of New South Wales (1992) 29 NSWLR 336 State Rail Authority of New South Wales v Brown (2006) 66 NSWLR 540 Briginshaw v Briginshaw (1938) 60 CLR 336 Lucas v The New Zealand Insurance Co Limited [1983] 1 VR 698 CASES CITED : Castellain v Preston (1883) ll QBD 380 Grant v Aetna Insurance Co (1862) 15 ER 589 Spina & Spina v Mutual Acceptance (Insurance) Ltd (1984) 3 ANZ Ins Cas 60-554 British Traders' Insurance Company Limited v Monson (1964) 111 CLR 86 CIC Insurance Limited v Bankstown Football Club Limited (1997) 187 CLR 384 New Zealand Shipping Co v Societe des Ateliers et Chantiers de France [1918-19] All Rep ER 552 Alghussein Establishment v Eton College [1991] 1 All ER 267 Athlone Pty Ltd v General Accident Fire & Life Assurance Corporation (1985) 3 ANZ Ins Cas 60-648 Lawson v Zurich Australian Insurance Limited (Rolfe J, 30 July 1996, unreported) CIC Insurance Limited v Bankstown Football Club Ltd (1995) 8 ANZ Ins Cas 61-232 Tricontinental Corporation Ltd v HDFI Ltd (1990) 21 NSWLR 689 Hadley v Baxendale (1854) 9 Exch 341 Wardley Australia Limited v State of Western Australia (1992) 175 CLR 514 Russell Young Abalone Pty Limited v Traders Prudent Insurance Company Limited (1993) 7 ANZ Ins Cas 61-182 Kassem v Colonial Mutual General Insurance Co Ltd [2001] NSWCA 38 Judd & Judd v Suncorp Insurance & Finance (1988) 5 ANZ Ins Cas 60-832 Green v AMP Life Limited (2005) 13 ANZ Ins Cas 90-124 Motor Accident Mutual Insurance Pty Limited v Kelly (1998) 10 ANZ Ins Cas 61-420 Tropicus Orchids Flowers and Foliage Pty Ltd v Territory Insurance Office (1998) 148 FLR 441 Ferrcom Pty Limited v Commercial Union Assurance Co of Australia Limited (1989) 5 ANZ Ins Cas 60-907 Wenham v Ella (1972) 127 CLR 454 Ronnoc Finance Limited v Spectrum Network Systems Limited (1997) 45 NSWLR 624 TCN Channel 9 Pty Limited v Hayden Enterprises Pty Limited (1989) 16 NSWLR 130 Manly Municipal Council v Skene [2002] NSWCA 385 The Commonwealth v Amann Aviation Pty Limited (1991) 174 CLR 6