In the matter of Reed Constructions Australia Pty Ltd (in Liquidation) – Walley v Chubb Insurance Australia Ltd [2019] NSWSC 1007

Supreme Court New South Wales

Medium Neutral Citation: In the matter of Reed Constructions Australia Pty Ltd (in Liquidation) – Walley v Chubb Insurance Australia Ltd [2019] NSWSC 1007 Hearing dates: 8 August 2019 Decision date: 08 August 2019 Jurisdiction: Equity Before: Leeming JA Decision: 1. Notice of motion filed 11 June 2019 dismissed.

2. Applicants to pay the costs of Chubb Insurance Company of Australia Ltd of the notice of motion filed 11 June 2019, such costs to be enforceable forthwith. Catchwords: CORPORATIONS LAW – claim by liquidators against director for insolvent trading – D&O policy responded to claim – director entered into personal insolvency agreement – liquidators agreed only to enforce judgment against proceeds of insurance policy – whether insurer should be joined to proceedings pursuant to Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW) – whether any evidence of dispute between insurer and insured director – whether improved prospects of obtaining a costs order against insurer foreign to discretion to join – application refused – Opes Prime Stockbroking Ltd (in liq) v Stevens [2014] NSWSC 659 and DSHE Holdings v Abboud [2017] NSWSC 579, followed

COSTS – whether unsuccessful liquidators should pay costs of separately represented insurer and insured – general principle that unsuccessful party not ordered to pay two sets of costs where no possibility of conflict between successful separately represented parties – liquidators ordered to pay one set of costs – Local Democracy Matters Inc v Infrastructure NSW (No 2) [2019] NSWCA 118 applied Legislation Cited: Bankruptcy Act 1966 (Cth), Part X Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW), ss 3, 4, 5, 6, 12 Civil Procedure Act 2005 (NSW), s 98 Corporations Act 2001 (Cth), ss 199B, 199C, 588M Law Reform (Miscellaneous Provisions) Act 1946 (NSW), s 6 Uniform Civil Procedure Rules 2005 (NSW), r 42.1 Cases Cited: Damm v Coastwide Site Services Pty Ltd [2018] NSWSC 611 DSHE Holdings Ltd (Recs and Mgrs Apptd) (In Liq) v Abboud; National Australia Bank Ltd v Abboud [2017] NSWSC 579 Energize Fitness Pty Ltd v Vero Insurance Ltd [2012] NSWCA 213 Guild Insurance Ltd v Hepburn [2014] NSWCA 400 Insurance Australia Ltd v Dent [2019] NSWCA 134 Local Democracy Matters Inc v Infrastructure NSW (No 2) [2019] NSWCA 118 Opes Prime Stockbroking Ltd (in liq) (Scheme Administrators apptd) v Stevens [2014] NSWSC 659 Rushleigh Services Pty Ltd v Forge Group Ltd (In Liq) (Recs and Mgrs Apptd) [2018] FCA 26; 355 ALR 248 Selig v Wealthsure Pty Ltd (2015) 255 CLR 661; [2015] HCA 18 Wayland v Bird [2017] NSWCA 26 Texts Cited: New South Wales Law Reform Commission, Report 143: Third party claims on insurance money, (November 2016) Category: Procedural and other rulings Parties: Daniel Austin Walley and Christopher Clarke Hill in their capacity as joint and several liquidators of Reed Constructions Australia Pty Ltd (in liquidation) ACN 003 340 878 (First Plaintiffs/Applicants on notice of motion) Reed Constructions Australia Pty Ltd (in liquidation) ACN 003 340 878 (Second Plaintiff) Geoffrey Vere Reed (First Defendant) Derry Bernard Hill (Second Defendant) Chubb Insurance Australia Limited (Respondent on notice of motion) Representation: Counsel: