The insured was a real estate agent and property manager who
held professional indemnity insurance with American Home Assurance
Company. The plaintiff was renting a property managed by the
The plaintiff was hit on the head by a pelmet which fell in the
house in April 2005. She then sent a letter to the insured dated 26
April 2005 informing him that she had suffered personal injury and
would advise him of her intentions in that regard. She also listed
17 other concerns with the general repair and maintenance of the
rental property. She stated that the insured and the landlords
would "be held liable for any personal injury claims
arising from damage caused to the tenants due to poor living
conditions" and that she had a current entitlement to
bring a personal injury claim. The letter made no specific demand
for payment in respect of the alleged personal injuries.
The plaintiff served a formal notice of claim on the insured in
September 2005, however his insurance policy had expired in July
2005. The policy responded to claims made against the insured
during the policy period. The insured nonetheless made a claim
under the policy, which was denied by his insurer.
The Court had to determine whether the letter from the plaintiff
to the insured in April 2005 constituted a 'Claim' within
the meaning of the policy. The policy defined 'Claim' to
mean any written demand for compensation in respect of professional
services, which included property management.
The Court noted that interpreting terms in a contract of
insurance requires the determination of what a 'reasonable
person would have understood the terms to mean', in view
of both the plain meaning of the text and the relevant
circumstances known to the parties when entering into the contract.
In this instance, it took the view that in order for the letter to
be deemed a 'Claim' it must contain a written demand for
Notwithstanding that the 26 April 2005 letter contained no
request for payment/compensation for the plaintiff's injuries,
the Court held that it did constitute a written demand for
compensation (a 'Claim' within the meaning of the policy)
against the insured as the plaintiff had expressed an entitlement
to make a personal injury claim as a result of her injury and had
asserted that the insured was liable to her for damages for
personal injury. The policy therefore responded to the claim
subject to any exclusions.
The Court went on to find that an exclusion did apply, and the
insurer was entitled to deny indemnity on that basis.
Livesay v Hawkins & Ors  QSC
It is not necessary for a claimant to request payment or a
remedy from an insured for a 'Claim' to be made. It may be
sufficient if the claimant asserts a legal right to bring an action
against the insured, for which it considers the insured will be
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The failure of a party to call a witness does not necessarily give rise to an adverse inference being drawn in accordance with Jones v Dunkel (1959) 101 CLR 298. An unfavourable inference is drawn only if evidence otherwise provides a basis on which that unfavourable inference can be drawn.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).