FEDERAL COURT OF AUSTRALIA

QBE Insurance Australia Limited v Allianz Australia Insurance Limited (No 3) [2020] FCA 1090

ORDERS

THE COURT ORDERS THAT:

1.    On or before midday on 31 July 2020, the parties file an agreed short minute of order on the further conduct of the proceeding or, in the absence of agreement, each party should file a competing draft minute of order.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Revised from the transcript)

ALLSOP CJ:

1    In this matter, I have delivered a judgment earlier this year on the claim by QBE for contribution: QBE Insurance Australia Limited v Allianz Australia Insurance Limited [2020] FCA 589. The two issues that I dealt with were effected into orders that were made on 22 May 2020: QBE Insurance Australia Limited v Allianz Australia Insurance Limited (No 2) [2020] FCA 707.

2    Allianz wishes to contest one of those conclusions on appeal. The issue, in one sense, is final in that it determines the availability of contribution to costs notwithstanding the form of the respective policies. The appeal, however, plainly requires leave because it does not determine all the outstanding matters in the suit.

3    Allianz has filed a notice of appeal. In the ordinary course, there would be every reason for a judge to grant leave to appeal if it did not hold up the conduct of the balance of the case. It is an important issue and affects the width of the case. In any application, Allianz should not feel constrained to expend too much money justifying the leave request beyond attaching these reasons and explaining the delay which, as I would understand it, is based on some confusion as to the nature of the final judgment of this Court.

4    Speaking for myself, if I were the judge considering the granting of leave, I would grant the leave. If Mr Muston’s client has no objection, I would allow the extension and grant the leave but not in a way that would interfere with the conduct of the balance of the case. The parties can discuss amongst themselves whether that is a convenient course to reduce the amount of costs.

5    The balance of the case has been helpfully set out in the Joint Statement of Issues dated 28 July 2020, which I will set out as an annexure to this judgment. Looking at those matters, it is plain that there will be some form of litigation on the question of the appropriate contribution. There is apparently a construction issue and also an issue about s 54 of the Insurance Contracts Act 1984 (Cth) raised in paragraph 1(b). That construction issue should be pleaded because the operation of s 54 will have to be pleaded in reply and, if there is an answer to s 54, in a further pleading in rebuttal to the reply.

6    The issue in paragraph 2, if I may say without disrespect, is slightly opaque, but it may be an important issue. The obligation of insurers to each other in the circumstances that these two insurers found themselves might not be without its complexity; and how that fits into the equitable relationship and the equitable obligations of rights that found contribution is not entirely clear. Therefore, the issue in paragraph 2 also deserves some explication.

7    Ultimately, depending upon how the evidence plays out, there will be underlying the resolution of this dispute an examination of how the case was run in the Supreme Court. I do not propose to deal with that kind of extended issue in this List.

8    I raised with the parties the appropriateness of in my view, at least ex facie, an experienced practitioner conversant with both the Supreme Court building litigation of this kind and insurance issues hearing the balance of the issues of this case by way of a reference and delivering a referee’s report to the Court, such that legal issues could be dealt with de novo and factual issues dealt with in the usual way from a referee’s report. The parties should give consideration to this. If there is to be any argument about the making of that order, that can be dealt with in due course.

9    For these reasons, I think it appropriate that the concise statement be reduced into a statement of claim. The parties are to prepare short minutes to provide for pleadings to follow that including up to a rebuttal for a reply and for the preparation of evidence for the balance of the case. The issues may call for discovery. We will deal with that in due course before the reference.

10    For now, I will stand the matter over to a date to be fixed for case management in consultation with my Associate. I require the parties by midday on Friday 31 July 2020 to file an agreed draft minute of order on the further conduct of the proceeding, including whether the applicant agrees to the respondent’s application for an extension of time and leave to appeal. If the parties cannot agree upon a draft minute of order, then by the same time, midday on Friday 31 July 2020, each party should file a competing draft minute of order.

Associate:

Dated:    7 August 2020

Annexure A