Brian Newbery v AA Insurance Ltd
 NZHC 2457
This judgment is for an earthquake case with a difference; it is the first based on a contents policy.
Mr Newbury and his wife are collectors of Lladro figurines. These were displayed around their home, including on a mantelpiece, in display cabinets, and some under coffee tables where they could be seen.
In the Christchurch earthquake on 22 February 2011, 30 pieces of Lladro were damaged. It is undisputed that the replacement cost of these pieces is $210,065.
The contents policy
Mr Newbury insured his household contents with a policy from AA Insurance Ltd. The policy stated that:
The policy recorded a total sum insured of $328,895, and included a number of specified items, all of which were jewellery.
Works of art are defined in the policy as "pictures, paintings, prints, sculptures, ornaments, tapestries, antiques (other than furniture), hand woven mats or rugs." Mr Newbery did not specify the Lladro as works of art in his insurance policy.
The question to be determined
Justice Nation needed to decide whether the Lladro were works of art, in terms of the policy, and therefore whether AA Insurance's liability in respect of the damage to them was limited to $20,000. He said that:
The High Court's decision
Expert evidence from a valuer and an auctioneer was heard. They both agreed that Lladro is usually just referred to as "Lladro", but that is could also appear in catalogues as a Lladro ornament or a Lladro sculpture.
Justice Nation decided that the term "ornament" is wide, but that its use in the policy:
He went on to say that to an ordinary person, an ornament would mean an item which has no practical use, and was on display because the owner appreciated its appearance.
Justice Nation decided that:
In this case:
Justice Nation went on to say that because the Lladro figurines were mass produced in a factory he would not consider them to be sculptures, but he also noted that if he had construed the term "ornaments" more narrowly, he might have adopted a wider meaning for the term "sculptures".
The end result of the case is that the amount that Mr Newbery could claim for the damaged Lladro is limited to $20,000. This judgment serves as a reminder to ensure that all valuable items are specifically noted on insurance policies.
A copy of the decision is available here: http://www.courtsofnz.govt.nz/cases/newbery-v-aa-insurance-ltd/at_download/fileDecision
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