Abstract

Article

Duration of a Policy Issued Pursuant to a Facility

That the duration of a facility for the provision of insurance cover is specified by reference to when risks would attach does not mean that the period of a policy granted nder the facility is limited to the facility’s temporal limitation.  If the covered risk attaches during the facility, depending on the relevant language the risk itself may extend beyond the facility’s termination.. Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137

Policies are Construed as Commercial Contracts

Contracts of insurance are to be construed according to the principles of construction that apply to commercial instruments: McCann v Switzerland Insurance Australia Limited [2000] HCA 65; (2000) 203 CLR 579 at [22] (Gleeson CJ), [74] (Kirby J); and Wilkie v Gordian Runoff Limited [2005] HCA 17; (2005) 221 CLR 522 at [15]; Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137

 

Time as at which Policy is Construed

On temporal issues, a contract is interpreted as at the date on which it was entered into. If the reference is to Local Standard Time, there may be an issue as to whether it is to be that in the place where the Facility is arranged or in the place where the risk would attach. Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137

 

Related Instruments

A commercial instrument which comes into existence pursuant to an obligation in another should be given a construction which conforms to its terms: Zhu v The Treasurer of the State of New South Wales [2004] HCA 56; (2004) 218 CLR 530 at [83]. For a series of inter-connected agreements, the construion of one must be undertaken within the context of the others: Hancock Prospecting Pty Ltd v Wright Prospecting Pty Ltd [2012] WASCA 216; (2012) 45 WAR 29 at [81]; Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137

Circumstantial Context of Regulation and Practice

The regulatory context in which a contract of insurance was concluded is part of the context for its construction CGU Insurance Limited v Porthouse [2008] HCA 30; (2008) 235 CLR 103 at [43]‑[58]; Royal Botanic Gardens and Domain Trust v South Sydney City Council [2002] HCA 5; (2002) 240 CLR 45 at [9]‑[12]; Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241 at [13], [30], [50], [64]; and Alpha Wealth Financial Services Pty Ltd v Frankland River Olive Company Ltd [2008] WASCA 119 at [113]. So, too, the practice that is followed in arranging insurance and instruments brought into existence as part of it: Birla Nifty Pty Ltd v International Mining Industry Underwriters Ltd [2014] WASCA 180; (2014) 47 WAR 522 at [57]‑[59]; Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137

Construction of a Mixed Policy

A policy may be a mixture of composite parts. Gambles v Ocean Marine Insurance Co of Bombay [1876] UKLawRpExch 16; (1876) 1 Ex D 141, and a section which attracts a particular form of constructionby reason of its nature does not necessarily lend that feature to other parts of the cover. Swashplate Pty Ltd v Liberty Mutual Insurance Company trading as Liberty International Underwriters [2020] FCAFC 137.

Indemnity Costs

The absence of full and frank disclosure to the court on an ex parte application will justify indemnity costs against the applicant when the order obtained is reversed. DWA Finance v Community Brokers Network P/L(No 3) 2020 NSWSC 1052.