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Is the JobMaker juice worth the squeeze?

Would your business be covered for injury to a JobMaker?

This month the federal government announced its JobMaker Plan, to encourage businesses to hire workers in the 16 to 35 age bracket, through hiring credits of $100 or $200 per week, for 12 months.  However, the way in which prospective workers are identified and engaged, may lead to a rise in liabilities for which many businesses may be uninsured.

The JobMaker Program

The government predicts that the JobMaker Hiring Credit program will create around 450,000 positions nationwide.  The new recruits must be “eligible employees”.  To be an eligible employee an employee must:

  • “be aged either:
    • 16 to 29 years old, to attract the payment of $200 per week; or
    • 30 to 35 years old to attract the payment of $100 per week at the time their employment started;
  • have worked at least 20 paid hours per week on average for the full weeks they were employed over the reporting period;
  • commenced their employment between 7 October 2020 and 6 October 2021;
  • have received the JobSeeker Payment, Youth Allowance (Other), or Parenting Payment for at least one month within the past three months before they were hired;
  • be in their first year of employment with the employer, reflecting the hiring credit is only available for each additional job; and
  • must be employed for the period that the employer is claiming for them.”

Using agencies to find eligible employees

But how will an eligible business know whether a job applicant has received one of the qualifying government benefits within the 3 months prior to hire?

Queue the training and apprenticeship agencies. With individuals pre-vetted for eligibility, agencies are already offering to pass on the JobMaker payments to businesses that engage workers through them.

So what’s the catch?

Workers’ compensation insurance

If a business hires a worker directly and that worker is injured, the business will be covered by the policy of workers’ compensation that it has in place for amounts payable to the worker (subject to the limits of the policy).

However, if a business engages a trainee or apprentice through an agency, the business probably won’t be the “employer” for the purposes of workers’ compensation. The agency will be.

Where a worker is an employee of a training and apprenticeship agency, the business will be the “host employer”.  The business may hold both a policy of workers’ compensation insurance and a public liability policy.  However, as the new hire would not be a “worker”, any injury they suffer in the course of their duties would not be covered by the host employer’s workers’ compensation policy. 

Public liability insurance

So what about the host employer’s public liability insurance of the business? It is standard for public liability policies to contain an employers liability exclusion. The wording of such clauses varies from insurer to insurer but they generally exclude cover for injuries suffered by individuals to whom benefits are payable under workers’ compensation or, who are engaged under a contract of service.  This means that (subject to the insurer’s policy wording) if a JobMaker is injured in the workplace of their host employer, the business may face an uninsured claim. 

Liabilities in contract

There is also the problem of any liability in contract that a host employer may assume in an agreement with an agency. If, for example, the agency has a contractual indemnity in its favour and a workers’ compensation claim is made by the worker, the agency’s workers’ compensation insurer may call on that indemnity. Insurance policies do not generally respond to liabilities assumed in contract and so, the host employer may again, face an uninsured loss.

What should you do?

Businesses retaining individuals through the JobMaker Program, should review their workers’ compensation and public liability policies in consultation with an insurance broker to understand whether they have adequate cover. Additional cover may be available in the market that will address (at least in part) the risk of an injury to a JobMaker in the workplace – at a price. The terms of the agreement with any relevant agency should also be carefully considered, to understand whether the business is assuming liabilities in contract for which it holds no insurance. After taking into account training costs, increased insurance premiums and the potential for uninsured liabilities, it may be that the JobMaker juice is not, in fact, worth the squeeze for a post covid business, when individuals are retained through agencies.

For a consultation to discuss a legal interpretation of your policy wording or a claim, contact (07) 3067 3025 or book an appointment online. If you know a business operator who may find this information useful, please share.

Kate DenningIs the JobMaker juice worth the squeeze?
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Business insurance and COV-19 losses

Can your business claim on insurance for COVID-19 related losses?

COVID-19 is causing billions of dollars of losses to small, medium and large businesses, across all industries. ‘We are all in this together’, as our leaders say. Despite numerous government assistance packages, many businesses cannot afford to bear the financial brunt of the ‘social distancing’ measures that we all must endure. So will your business insurance respond to your COV-19 related losses?

Businesses are taking a hit

Even if your business isn’t subject to a mandatory shutdown; the home confinement measures across Australian States and Territories are like death by a thousand cuts for many business owners. Day after day less and less people are walking through the door and revenues fall.

And if your business is subject to a shutdown – what are you supposed to do? Put the business into ‘hibernation’? Innovate? Offer services virtually? How? How much will it cost to get those services off the ground? No one knows how much all of this will cost. But what we do know is that many businesses are required to take a hit. But for how long? How much of a hit?

And the holy grail of questions is: when will insurance companies cop some hits too? The Australian insurance industry is worth hundreds of billions of dollars. The majority of Australian insurers make extraordinary profits every year and yet, in these ‘unprecedented times’, surprisingly few Aussie businesses have started to ask – ‘WHAT DO WE PAY INSURANCE FOR??’

What is business interruption insurance and do you have it?

Business interruption insurance is a type of insurance cover that many businesses hold, along with other types of cover, like property damage and legal liability. The purpose of business interruption insurance is to provide cover for the loss of income and other losses suffered by a business, due to an insured event.

To find out whether you hold business interruption cover, you will need to consider your policy wording and your schedule of insurance. Your schedule of insurance talks to your policy wording and identifies how different parts of the policy wording operate. Together, the policy wording and schedule of insurance are your ‘policy’.

Insurance companies are about to take a hit in the US – are Australian insurers next?

Businesses across several US states have applied to the Courts for declaratory relief to confirm that their businesses should be covered for COVID-19 related business losses.

The cases include:

  • A New Orleans restaurant subjected to operating restrictions suing certain underwriters at Lloyd’s of London – The restaurant, Oceana Grill, was the first US business to file a suit against an insurer for COVID-19 related losses on 16 March 2020. Before the outbreak, the business reportedly served up to 500 customers per day and was open from 8:00am to 1:00am, 365 days a year. Oceana Grill seeks an order from the Court that the Lloyd’s policy: 1) does not contain an exclusion for a viral pandemic; 2) it covers any future civil authority shutdowns due to COVID19; and, 3) it provides business income coverage, ‘in the event that the coronavirus has contaminated the insured premises’.

The gist of these cases is to the effect that coronavirus is a type of physical damage to their property or loss, which triggers cover and entitles the insureds to indemnity for:

  • business interruption losses; and/or
  • remediation to clean the surfaces of the establishment.

What about Australian businesses – when can they expect insurance companies to take a hit?

Similar litigation to that which is underway in the US may follow in other jurisdictions, like Australia and the UK.

The good news for insureds is that disputes about policy wording can generally be resolved relatively swiftly. Applications for declaratory relief like those in the US are usually disposed of by Australian Courts more easily because the Court is asked to consider a narrow issue: how particular wording in a policy of insurance should be interpreted.

In Australia, many policies exclude loss or damage caused by virus or bacteria and this has been widely discussed online. However, policy exclusions should always be carefully scrutinised, as they do not always operate to exclude cover for an insured.

For example, some Australian policies exclude cover for losses arising from quarantinable diseases under the Quarantine Act 1908 (Cth) (as amended). However, the Quarantine Act 1908 (Cth) was repealed in 2015 with the enactment of the Biosecurity Act 2015 (Cth) and so, it is questionable whether insurers could reasonably continue to rely upon such an exclusion to refuse cover. Instead of referring to ‘quarantinable diseases’, the Biosecurity Act 2015 (Cth) refers to ‘listed human disease’. COVID-19 is a listed human disease under the Biosecurity Act 2015 (Qld). The terms ‘quarantinable disease’ and ‘listed human disease’ have different meanings, with the latter being more prescriptive.

What should you do?

If your business is experiencing losses related to COVID-19 (irrespective of whether it has been subjected to a government shutdown), you should:

  1. Call your insurer/insurance broker or insurance agent and obtain a copy of your policy wording and policy schedule, together with all relevant endorsements.
  2. Read your policies to identify whether you have business interruption insurance and look for clauses that refer to ‘virus’, ‘bacteria’, a ‘civil authority’ or government decision.
  3. Document your losses. Gather all relevant business records over at least a period of 12 months prior to the period of loss.
  4. Seek independent advice from an insurance lawyer about your rights and interests.

How can we help?

The interpretation of insurance policies is a niche area of law and the general insurance industry in Australia is bespoke. As such, businesses should seek a legal interpretation of their insurance policies, to understand their rights and options.

Denning Insurance Law is one of a small number of Australian law firms that represents people and businesses – not insurers. We are interested in hearing from businesses with potential claims under their policies.

As independent insurance lawyers, we assist clients with:

  • Claims preparation
  • Internal Dispute Resolution
  • Complaints to the Australian Financial Complaints Authority
  • Applications to the Court for declaratory relief
  • Civil litigation

For a consultation to discuss your COVID-19 losses and business insurance, contact (07) 3067 3025 or book an appointment. If you know a business operator who may find this information useful, please share.

Kate DenningBusiness insurance and COV-19 losses
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Bill to stamp out the ‘insidious practice’ of claim farming in motor accident claims

Bill to stamp out the ‘insidious practice’ of claim farming in motor accident claims

On 14 June 2019, the Queensland Parliament introduced the Motor Accident Insurance and Other Legislation Amended Bill 2019 (Qld) (Bill) to address the practice of ‘claim farming’ in claims for personal injuries relating to motor vehicle accidents. 

What is ‘claim farming’?

The term ‘claim farming’ is not defined in the Bill

In the first reading speech of the Bill, Deputy Premier Jacqui Trad described the practice of claim farming as follows:

Claim farming involves anonymous persons cold calling members of the public about whether they have been involved in a motor vehicle accident.  They falsely identify themselves as calling on behalf of an insurer, the [compulsory third party] CTP Regulator – the Motor Accident Insurance Commission – or another government agency, allegedly with the sole purpose of helping the individual make a CTP claim. 

They use high pressured tactics and deceptive behaviour to elicit the individual’s personal information and agreement to submit a claim, often with the lure of quick and easy compensation.  This information is then sold, for a fee, to a lawyer or claims management service provider to handle the claim.

The practice of claim farming is widely condemned by lawyers working in personal injuries, as well as insurers across all types of personal injury claims.  For members of the public, the practice signals a breach of privacy through what is assumed to be, unlawful disclosure of their personal information.

Since February 2019, over 500 complaints have been submitted to the Motor Accident Insurance Commission (the Commission) about claim farming.

The Bill

The Bill aims to address the practice of claim farming through two major reforms:

  • a prohibition on the act of cold calling or personally approaching another person without their consent and soliciting or inducing them to make a CTP claim; and
  • making it an offence, for anyone to pay claim farmers for the names of potential CTP Claimants or to receive payment for a claim referral or potential claim referral.

The Amendments

The Bill proposes a number of amendments to the Motor Accident Insurance Act 1994 (Qld) (MAIA).  These include the following:

  1. The requirement of a law practice to complete a Law Practice Certificate (Certificate) (in a form approved by the Commission and verified by statutory declaration) and provide the Certificate to a Claimant prior to the commencement of a claim, after the start of a claim or prior to finalisation of a claim.
  2. The Certificate must state:
    • that the supervising principal and each associate of the law practice have not:
      • given, agreed to give, or allowed or caused someone else to give consideration to another person for a claim referral or potential claim referral for the claim in contravention of section 74(1); or
      • received, agreed to receive, or allowed or caused someone else to receive consideration from another person for a claim referral or potential claim referral for the claim in contravention of section 74(2); or
      • if section 74 does not apply to the supervising principal or an associate to the law practice – the circumstances mentioned in section 74(3) why it does not apply.
      • the supervising principal and each associate of the law practice have not personally approached or contacted the Claimant or solicited or induced the Claimant to make the claim in contravention of section 75; or
      • if section 75 does not apply to the supervising principal or an associate of the law practice – the circumstances mentioned in section 75(3) why it does not apply.
  3. A prohibition against a person (a payer) giving, agreeing to give or allowing or causing someone else to give consideration to another person (a payee) for a claim referral or potential claim referral. 
  4. A prohibition against a person (a payee) receiving, agreeing to receive or allowing or causing someone else to receive consideration from another person (also a payer).
  5. A prohibition against a person personally approaching or contacting another person and soliciting that person, the authorisation of the Commission to make application to the Court for an injunction restraining a person who the Commission reasonably believes has engaged, is engaging or is proposing to engage in conduct, whether in Queensland or elsewhere, that contravened, or is contravening the prohibitions referred to above.

Other changes

In addition, the Bill also sets out to:

  1. Amend to the Motor Accident Insurance Regulation 2018 (Qld) and the prescribed Notice of Claim form, by requiring a Claimant to provide additional information in their Notice of Claim including:
    • the Claimant’s Medicare number;
    • whether the Claimant requires an interpreter and, if so, the language of the interpreter;
    • a diagram showing, to the best of the Claimant’s knowledge, where the driver of each occupant of a vehicle was sitting in the vehicle at the time of the accident;
    • telephone numbers and email addresses of the owner and driver of each vehicle, involved in the accident;
    • telephone numbers and email addresses of the witnesses to the accident;
    • whether a claim has been made under a comprehensive insurance policy or a third party property damage policy and if so, the insurer for the policy, the policy number and any claim number relevant to the accident;
    • more detailed information in the medical Certificate which accompanies the Notice of Claim, including the date the Claimant was first examined by a doctor and their Health Practitioner Regulation National Law unique identifier;
    • the date the Claimant first consulted a lawyer about the possibility of making a claim;
    • the date the Claimant first retained a law practice to act for the Claimant in relation to the claim.
  2. Extend the 50/50 rule cap on legal costs in speculative personal injury claims to interstate law practices.
  3. Provide the Commission with additional powers.  The addition of a new Part 5B proposes to give special investigation powers to the Commission and most notably includes a section prohibiting an investigated person, or an associated person, from answering a question put to them by an investigator which:
    • might incriminate them; or
    • require them to disclose privileged client communication.


A penalty in excess of $39,000 per offence may apply for:

  • contraventions of the claim farming provisions;
  • a failure by a law practice to provide a Certificate; or
  • the provision of a Certificate by a law practice which is false or misleading. 

Additionally, a law practice who contravenes the claim farming prohibitions will not be entitled to recover any fees or costs, including disbursements, that relate to the provision of services for the claim and will be required to repay any amount received that relates to the services to the person from whom it was received.

Exceptions to claim farming

Under the Bill, ‘claim farming’ is not defined. However, ‘consideration’ is defined to mean a fee or other benefit.  Consideration does not include a gift, other than money or hospitality, if the gift or hospitality has a value of $200 or less. 

A ‘claim referral’ does not include the advertisement or promotion of a service or person that results in a claim using the service or person if the advertisement or promotion is made to the public or a group of persons.  For example, an advertisement of services provided by a law practice on the website or in the newsletter of a sporting association or charity, would not contravene the legislation.


The first reading speech suggests that the Bill is aimed at eliminating the unsolicited contact with members of the public by persons or organisations, who attempt to induce individuals to make CTP claims and sell their personal information.

Concern has been expressed among members of the profession that the prohibitions contained in the Bill may have unintended consequences for law practices with relationships with community organisations such as unions, sports clubs and community legal centres. However, by contrast, such organisations do not usually make unsolicited contact with individuals to induce them to make a claim.

If a law practice is paying any entity, or person, a monetary amount for a singular claim referral or potential claim referral (or multiple referrals), that law practice should review its arrangements, as against the Bill.  However, law practices that do not engage in such practices, should not be concerned.

While the potential penalties are high, the Bill only targets claim referrals in CTP claims and therefore, leaves open the potential for claim farmers to target individuals with other types of personal injury claims.

The amendments to Notice of Claim forms will allow CTP insurers to gather more information, at the start of a claim, than ever before.  This data will better identify potential referral relationships between particular health care providers and law practices.  Health care providers who refer prospective Claimants to a law practice may, or may not, contravene section 67 of the Personal Injuries Proceedings Act 2002 (Qld).  Under the MAIA in its current form, the Commission may impose licence conditions which require CTP insurers to provide that data so as to allow investigations into referral relationships between doctors and lawyers.

To report a claim farming incident relating to a motor vehicle accident, contact the Commission through this link.

Kate DenningBill to stamp out the ‘insidious practice’ of claim farming in motor accident claims
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QSC awards $800k in interest in business insurance claim

QSC awards $800k in interest in business insurance claim

Case note: Mitchell Ogilvie Menswear Pty Ltd v Rapid Edge Pty Ltd [2019] QSC 136

Mitchell Ogilvie Menswear Pty Ltd (the Plaintiff) stocks luxury Italian suits and business shirts, made-to-measure suits, everyday business attire, casual wear and high-end accessories.  On 31 May 2019, the Supreme Court of Queensland awarded the Plaintiff the sum of $1,278,708 in damages and interest of $795,799, for amounts recoverable against the Defendant following a fire in 2010.


The Plaintiff’s stock was damaged in a fire on 29 September 2010 which originated from a vacuum cleaner, in the basement tenancy of a jewellery business, close to the Plaintiff’s store.  The fire caused soot and smoke to enter the Plaintiff’s premises.  The Plaintiff’s store was located at 190 Edward Street and the fire caused a fine layer of soot to cover most, if not all, of the clothing stock in-store, the store fit out, floor coverings, horizontal surfaces and inside drawers. 

At the date of the fire, the Plaintiff had in place a Commercial Special Risks Policy (Policy) of insurance with Allianz Australia Insurance Ltd (Allianz).  The Plaintiff made a claim against its Policy, which was accepted. 

Attempts were made by Commercial Industrial Restoration Insurance Services to clean and decontaminate the stock, which included:

  • pre-vacuuming all stock, contents, fixtures and fittings throughout the property;
  • chemical dry sponging fabric based items;
  • removing contaminants from fixtures and fittings by way of wet wipe, alkaline treatment and then neutralise;
  • arranging for a commercial carpet cleaner to attend and clean all carpets and affected upholstery, clean, scrub and re-seal parquet floors; 
  • after-hours ozone treatment of the premises as an odour control measure.

The results of the cleaning and decontamination were variable.  Some items looked worse than before they were cleaned.

Under the terms of the Plaintiff’s Policy, Allianz was entitled to retain the damaged stock when it made a payout under it and to recoup the salvage value of that damaged stock.

Allianz proposed two options as to how to deal with the salvage of the damaged stock and these were:

  • an assessment of the damaged stock with a payment to the Plaintiff equivalent to its wholesale costs, or value net of GST, where the property would become the property of Allianz and later sold on behalf of Allianz for salvage value; or
  • for the Plaintiff to offer to retain the damaged stock at its agreed value, following which the Plaintiff would then be responsible for dealing with the damaged stock, for example by holding a fire sale and bearing the risks of the outcome of that process.

Mr Ogilvie had a number of concerns about handing over the damaged stock to Allianz and offered to pay $150,000 to $200,000 to Allianz in exchange for the damaged stock.  This represented 10% to 15% of the wholesale value of the stock.

Allianz’s appointed loss adjuster, Cunningham & Lindsay, did not consider that the Plaintiff’s offer represented the true salvage value for the damaged stock and engaged, Mr Webber, Managing Director of Lloyds Auctioneers & Valuers, to prepare a salvage valuation and a proposal for the sale of the damaged stock by public auction. 

Mr Webber produced a report to Allianz advising that his estimate of realisation of the damaged stock was between $220,000 and $450,000, with net guaranteed proceeds of sale of $195,000. 

Further to Mr Webber’s valuation, the Plaintiff increased its offer to Allianz to $225,000 for the damaged stock.

The Plaintiff then proceeded to sell the stock in-store in a fire sale and by late 2011, almost all of the damaged stock was sold.  The business’ records in relation to the sale of salvaged stock did not accurately identify the sale price of the salvaged goods, in part due to the sku system used with the sale stock.

The wholesale value of the stock within the Plaintiff’s tenancy at around the time of the fire was almost $1.7M.

Issues at trial

The issues for consideration by the Court were:

  • whether the Plaintiff’s proposed measure of the property damage it suffered, namely the diminution in value of the stock that came to be damaged was appropriate. The Plaintiff sought the difference between the wholesale value of the stock just before the fire and its salvage value shortly after the fire;
  • the salvage value of the damaged stock after it was cleaned and treated;
  • the value of the undamaged stock.

Findings of the Court

The Defendant admitted liability in full for property damage and economic loss caused to the Plaintiff as a result of the fire.  The Defendant abandoned or did not press a defence of “avoided loss” at trial.

The Court observed that where a Defendant’s tort has caused damage to a Plaintiff’s existing property, the general compensatory principle is that the Plaintiff should be put into as good a position as if its property had not been damaged.  To do so, there was a choice between:

  • awarding the diminution in value of the property; and
  • the cost of cure, comprising the cost of replacement or, if possible, repairing the goods.

From the judgment, it would appear that the Defendant had a theory to the effect that the Plaintiff had sold the damaged stock for significantly more than the salvage value which he paid Allianz.  However, the Court ultimately preferred the opinion of Mr Webber as to the stock’s value; over the Defendant’s theory and its forensic evidence (about which the Court expressed a number of concerns).

The Court concluded that the appropriate measure of loss for the Plaintiff’s property damage loss was to be determined by deducting from the wholesale value of the goods ($1,683,974), the following amounts:

  • salvage value of the stock being $225,000;
  • value of undamaged stock $184,376;
  • purchase price of new stock $34,231.

The Plaintiff was also allowed the costs incurred in carrying out the decontamination and cleaning of the stock ($22,085.28), forensic examiner report costs ($10,061.24) and loss adjuster costs ($6,195), by way of damages – not costs.

This brought the total of the damages judgment in favour of the Plaintiff to $1,278,708. 

The Court also ordered to pay interest from September 2010 to 31 May 2019 in the sum of $795,799.

Considerations and costs

The published judgment does not deal with the question of costs.  However, with the litigation running from 2014 to 2019, it seems likely that the costs and interest on the claim shall exceed the total value of damages awarded.

This decision will be of interest to insurers in respect of their recovery actions.  An unfavourable finding for the Plaintiff in this case could have had industry wide implications for how insurers pay out claims to insureds.

Kate DenningQSC awards $800k in interest in business insurance claim
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Criminal conduct and claims for personal injuries

If a person commits a crime, can they still claim damages for personal injuries arising out of the event? Well… it depends.

The Civil Liability Act 2003 (Qld) (CLA) and the Criminal Code Act 1899 (Qld) (CCA) each limit the circumstances in which a person may claim damages for personal injuries sustained in connection with a criminal offence.

In the recent decision of Brown v Logan City Council [2019] QSC 46, the Supreme Court of Queensland considered whether a claim could be defended by the Council on the basis that the Plaintiff had no entitlement to sue in the first place. 


The Plaintiff (Ms Brown) was injured in a motor vehicle accident when her vehicle passed onto the wrong side of the road at a sweeping bend and she collided with an oncoming vehicle.

The Plaintiff was charged with dangerous operation of a vehicle. She pleaded guilty to the offence, which was dealt with on indictment in the District Court. 

She sued the Council for the injuries she sustained from the accident. She alleged failures on the part of the Council with respect to the design, construction and maintenance of the road. In response to the Plaintiff’s claim, the Council pleaded that the Plaintiff was not entitled to commence proceedings by virtue of section 6 of the CCA and, in the alternative, was not entitled to an award of damages by operation of section 45 of the CLA. 

After a Request for Trial Date was filed, the Plaintiff made application to the Court, seeking to strike out the paragraph of the Council’s pleading that relied upon section 6 of the CCA.

Issue for determination

Section 6 of the CCA states relevantly as follows:

‘Civil remedies

(2) A person who suffers loss or injury in, or in connection with, the commission of an indictable offence of which the person is found guilty has no right of action against another person for the loss or injury.

Section 45 of the CLA provides:

’45 Criminals not to be awarded damages

(1) A person does not incur civil liability if the court is satisfied on the balance of probabilities that-

(a) the breach of duty from which civil liability would arise, apart from this section, happened while the person who suffered harm was engaged in conduct that is an indictable offence; and

(b) the person’s conduct contributed materially to the risk of the harm.

(2) Despite subsection (1), the court may award damages in a particular case if satisfied that in the circumstances of the case, subsection (1) would operate harshly and unjustly.

(4) It does not matter whether the person whose conduct is alleged to constitute an indictable offence has been, will be or is or was capable of being proceeded against or convicted of an indictable offence.

(5) If the person has been dealt with for the offence, it does not matter whether the person was dealt with on indictment or summarily. 

The issue for determination by the Court was whether section 45 of the CLA operated to repeal section 6(2) of the CCA.

The Plaintiff’s Submissions

The Plaintiff argued that section 45:

(a) ‘covers the field’, so there is no need for section 6;

(b) other Australian jurisdictions have a provision similar to section 45 in their legislation, which fulfills a similar purpose; 

(c) if section 6 remains in force, then section 45 has no real legal effect; and

(d) the two sections cannot stand together and work cumulatively. 

The Judgment

In refusing the Plaintiff’s application, His Honour Justice Davies observed that there must be very strong grounds to support an implied repeal and displace the general presumption that both provisions continue to operate. His Honour was not satisfied that such grounds were made out in the Plaintiff’s case, finding: 

(a) the two sections operate very differently; 

(b) section 45 limits the liability of a potential defendant, whereas section 6 removes the potential plaintiff’s cause of action; 

(c) the CLA does not limit the protection from liability given by a provision of another Act or law: section 7(2).

The decision of the Court disposed of the Plaintiff’s claim at interlocutory stage, without the need for a trial. 


In Brown’s case, the Application was not heard until after a Request for Trial Date was filed. However, the same claim resolution strategy could be used to bring a claim to an end during the pre-Court stage, on application by a Respondent. 

Having regard to the reasoning in Brown, the relevant legislation in Queensland and other decisions from the Courts, the current state of play with respect to criminal conduct and Queensland claims for personal injuries may be summarised as follows:

(a) a conviction for an indictable (serious) offence, dealt with on indictment will disentitle a person from claiming damages for personal injuries in connection with the offence: section 6 CCA; Brown v Logan City Council [2019] QSC 46;

(b) a conviction for an indictable offence, dealt with summarily, will be deemed to be a conviction for a simple offence and will not engage section 6 of the CCA, so as to disentitle a potential plaintiff: Corliss v Gibbings-Johns [2010] QCA 233;

(c) the liability of a potential defendant may be limited (in entirety) by the potential plaintiff’s commission of a criminal offence, if it materially contributes to the risk of harm: section 45 CLA; 

(d) if it would be ‘harsh and unjust’ to deprive a potential plaintiff from an award of damages under section 45, their damages are to be reduced by 25% or more: section 45(3) CLA;  

(e) where a plaintiff makes clear and repeated requests to withdraw from a joint illegal enterprise, they may be owed a duty of care: Miller v Miller (2011) 242 CLR 446;

(f) where a plaintiff actively participates in a joint illegal activity (such as a joyride in a stolen vehicle), they may be owed no duty of care and section 45 may operate to limit their damages to $nil: Captain v Wosomo [2017] QSC 86; 

(g) section 45 also applies to the criminal conduct of deceased persons in wrongful death claims: section 64 Civil Proceedings Act 2011 (Qld).

Kate DenningCriminal conduct and claims for personal injuries
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Claims wrongly denied for non-payment of a premium

Most of us have an instalment contract of general insurance. An instalment contract is one under which the insured pays the premium in seven (7) or more instalments per year. Comprehensive car insurance or home and contents insurance policies are examples of such products.

But what happens if you miss a premium and an ‘event’ occurs under the policy? Your policy will contain a clause about this.

The Policy wording

By way of example, the current Youi Insurance Ltd home and contents Product Disclosure Statement provides as follows:

‘Make your premium payments/s.

You must ensure that your first and any subsequent instalment premium payments are made by the due dates in order to be covered, if any payment remains unpaid for a period of 14 calendar days or more, we may refuse to pay your claim. If any payment remains unpaid for a period of one calendar month or more, we may cancel your policy as permitted by law’

The Insurance Contracts Act 1984 (Cth)

The Insurance Contracts Act 1984 (Cth) requires insurers to state the circumstances in which they will limit their liability, or refuse to pay a claim in the event of non-payment of a premium.  Section 39 of the ICA states:

‘Where a provision included in an instalment contract of general insurance has the effect of limiting the liability of the insurer by reference to non-payment of an instalment of the premium, the insurer may not refuse to pay a claim, in whole or in part, by reason only of the operation of that provision unless:

(a) at least one instalment of the premium has remained unpaid for a period of at least 14 days; and

(b) before the contract was entered into, the insurer clearly informed the insured, in writing, of the effect of the provision.’

Claim denials by insurers

If an insured fails to pay a premium by the due date, many insurers send a reminder letter shortly afterwards saying something like:

‘We tried to debit your Home insurance premium of $400.00 on 10/12/2018 and we’ve been notified by your credit card provider that we were unsuccessful.
For your continued protection we’ll try again on 21/12/2018.’

If a premium has remained unpaid for at least 14 days and an ‘event’ occurs under the policy, some insurers deny the claim at first instance, purporting to rely upon a clause just like Youi’s above.

A decision to reject a claim on the basis of an insured’s non-payment of a premium, before a policy is cancelled should be challenged through a process like those described in our previous article, 7 Tips for dealing with insurance claims. In some circumstances, a decision to reject a claim for an event occurring after cancellation may be contestable too, if the cancellation itself was invalid.

What many insureds do not realise is that a communication like this reminder notice can operate to extend the due date for the premium. This is important because if the due date for the premium is reset, an insurer cannot refuse to pay a claim for an event which occurs within 14 days of the ‘new’ due date for the premium.

Decisions of the Financial Ombudsman Service (now ACFA)

There are a number of decisions by the Financial Ombudsman Service (FOS) on this issue in favour of insureds and these include:

(a) Case number: 213834:

In this case, the Financial Services Provider (FSP) was unable to direct debit an account on the due date for the first instalment of the premium. The FSP subsequently cancelled the policy and an event occurred after the cancellation of the policy. In arriving at its decision in favour of the applicant, the FOS noted as follows:

’28. However, in considering the evidence submitted by the FSP, the Panel notes the FSP’s letter of 23 June 2010 which states ‘A cancellation letter was sent on 4 May 2010 advising if payment is not received by 14 May 2010 then policy (sic) will be cancelled’. This letter extends the period for payment to 14 May, indicating that cover will continue subject to payment, but that if a payment was not made by 14 May it would cancel the policy.’

It follows then, that a reminder letter such as the one above ‘extends the period for payment’. Once the due date for the premium is extended, the 14-day period under section 39 of the ICA cannot begin to run until the ‘new’ date for payment of the premium and cover must be extended for a claim arising prior to the expiration of 14-days.

(b) Case number 241836:

In this case, the FSP was unable to direct debit an account on the due date for the premium. The applicant submitted a claim one (1) month later for an event and the FSP denied cover on the basis that the policy had been cancelled and that it was entitled to decline cover as the payment remained unpaid for 14 days. In arriving at its decision in favour of the applicant, the FOS determined:

’36. A critical matter is that I disagree with the FSP’s argument that the Overdue Notice did not change the due date for the monthly instalment. Consistent with earlier Determinations of this Service, my view is that when the FSP advised in the Overdue Notice that it ‘will try again to deduct the payment on 1 January 2011’ the FSP has effectively extended the due date to pay the monthly instalment premium to 1 January 2011.

37. This conclusion is fundamental to the decisions which must be made as to the various points advanced by the FSP.

38. In my opinion, in order for the FSP to successfully deny a claim on the ground of non-payment of an instalment premium, the accident or event giving rise to the claim must have occurred after the 14th day from the date the premium was due. Otherwise stated, the accident or event must have occurred on the 15th day.

39. Once the conclusion is reached that the due date for payment of the instalment premium was 1 January 2011, 14 days thereafter is 15 January 2011. As the collision occurred on 15 January 2011, the FSP was not entitled to refuse to meet the claim arising from this collision on the ground of non-payment of the premium. The 14 days does not expire until midnight on the 14th day.’

It should be beyond doubt, that the position of the FOS (now ACFA) is that a reminder notice, extends the due date for payment of premium and that denial of non-payment of premium cannot be effective until after midnight on the 14th day following the ‘new’ due date for a premium.


Insurers who:

(a) offer instalment contracts of general insurance; and

(b) deny claims on the basis of non-payment of a premium,

may find themselves squarely in the gun. On one view, this conduct could be described as a breach of the duty of utmost good faith or, misleading and deceptive. A want of intention to mislead or deceive does not matter. 

Insurers who adopt this sharp practice on mass across claims have impacted an indeterminate number of insureds. 

Insureds are not to know the laws that protect them. Many insureds who experience claim denial in these circumstances simply accept the insurer’s determination as valid and take their claim no further. They cannot even contemplate the idea that there insurer would deny their claim unless they had good reason to. Perhaps some insurers bet on this. 

Insurers providing these products should know, or do know, better. They are expected to make the right decision. 

Denning Insurance Law is interested in hearing from insureds across Australia with respect to decisions like this. To enquire about challenging a decision to deny a claim for non-payment of a premium, email 

Kate DenningClaims wrongly denied for non-payment of a premium
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Late reporting of injury and other problems on quantum

Late reporting of injury and other problems on quantum

Case note: Evans v Williams [2018] QDC 210

A 51 year old kitchenhand, Ms Marie Evans, was injured while executing a right hand turn, when a vehicle coming in the opposite direction collided with the front of her car.

The accident happened in September 2015 and the compulsory third party insurer for the vehicle at fault, Allianz Australia Insurance Ltd, admitted liability for the circumstances of the accident.


Ms Evans sought damages for a musculo-ligamentous injury to her lumbar spine, bilateral hip injuries and a psychiatric injury as a result of the accident.

Ms Evans was born in Mauritius, educated to grade 11 and came to Australia in 1986. She had a number of jobs in her working life and it was only when her children were growing up that she was unable to maintain steady employment. Ms Evans returned to work the day after the accident but called in sick the following day because her pain ‘was getting really bad’. Her evidence was that there had been no time following the accident when she felt ‘completely free of pain’.

Her first attendance with a medical practitioner after the accident was on 4 March 2016, when she consulted a general practitioner about problems with her left ear. There was no complaints of back or hip pain during that attendance.

Ms Evans did not tell her employer (RSL Care) about the motor vehicle accident at that time because she was afraid of losing her job, however, she adjusted her work hours to start work early and finish a little later at times.

On 28 April 2016, Ms Evans resigned from her employment. Her letter of resignation did not make reference to issues relating to her back or hip. In the fortnight prior to her resignation, Ms Evans worked a 76 hour fortnight.

She first sought treatment for lower back pain on 13 May 2016, over eight (8) months after the accident. The entry in the general practitioner’s notes noted, ‘[n]o preceding trauma’. Ms Evans had an attendance with another general practitioner on 8 June 2016, at which time hip pain was reported. The clinical notes noted that her symptoms had been ongoing for, ‘the last year or so’ and stated that Ms Evans, ‘[d]id heavy lifting for a long time’.

The symptoms experienced by Ms Evans were not linked to the subject accident until after she attended with her solicitors on 8 September 2016. On 16 September 2016, almost one (1) year after the accident, a doctor with whom she attended linked the lower back pain to the motor vehicle accident.

Following her resignation from RSL Care, Ms Evans secured employment with the Logan City Council and after that, received Centrelink benefits for a short period of time, before commencing employment with her current employer, Homelife.

Expert evidence

Ms Evans relied upon the expert opinions of Drs Shaw (Orthopaedic Surgeon) and De Leacy (Psychiatrist). The Defendants relied upon the opinions of Dr Boys (Orthopaedic Surgeon) and Professor Whiteford (Psychiatrist).

Dr Shaw assessed Ms Evans as suffering a 6% whole person impairment (WPI) under AMA5 and Dr Boys assessed her as suffering a 5% WPI. Dr Shaw accepted at trial that if, in truth, the back and hip pain arose nine (9) months after the motor vehicle accident, it was, ‘very, very unlikely’ that the pain was related to the accident. Dr Boys did not relate the hip injury to the accident. As to her back pain, Dr Boys was of the view that she could have experienced temporary back pain which resolved and then symptoms related to her degenerative back condition when she sought treatment in May 2016.

Psychiatrists Professor Whiteford and Dr De Leacy assessed Ms Evans as suffering a 4% and 5% PIRS rating respectively. Professor Whiteford diagnosed Ms Evans as suffering from an Adjustment Disorder with depressed mood. Dr De Leacy diagnosed an Adjustment Disorder with mixed anxiety and depressed mood. Both accepted that if the motor vehicle accident did not cause a physical condition, then any psychiatric condition would not be related to the accident.


Justice Jarro doubted the reliability of some of Ms Evans’ evidence regarding the extent of her accident related injuries and the sequelae arising from it, however, he was not prepared to reject the entirety of her claims.

The lack of contemporaneous medical reporting and reporting to Ms Evans’ employer, RSL Care (notwithstanding her reason for doing so) was given considerable weight in the judgment. Justice Jarro was not satisfied that these deficiencies could be ameliorated by lay witness accounts of Ms Evans’ demeanor or presentation pre-accident versus post-accident.

In Justice Jarro’s reasons, he highlighted a statement by Justice Gotterson in Edington v Board of Trustees of the State Public Sector Superannuation Scheme [2016] QCA 247 at 57 on causation:

This submission employs the assumption that because an event occurs after another, that event must have been caused by the other. Reasoning on the basis of such an assumption, as the appellant does here, is flawed logic. The flaw is deepened when the reasoning is sought to be used to exclude any other preceding event from having had a causal relationship with the event which occurs later in time.

Ms Evans was awarded damages as follows:

General Damages – $15,750

Past Economic Loss – $103

Interest on Past Economic Loss – $4.14

Past Loss of Superannuation – $9.53

Future Economic Loss – $20,000

Future Loss of Superannuation – $2,200

Past Special Damages – $1,773.08

Interest on Past Specials – $24.52

Future Special Damages – $2,500

Total – $42,364.27


This judgment will be of interest to insurers and personal injury lawyers. It highlights the importance of considering the following matters in claims for personal injuries:

(1) when and what injuries are reported to medical practitioners and employers;

(2) letters of resignation given by plaintiffs to employers following an accident;

(3) the timing of a plaintiff’s initial attendance with their solicitors on a claim in the context of the medical evidence at that time;

(4) the stated cause of alleged accident related symptoms at all medical attendances;

(5) the questions which are likely to be put to expert witnesses at trial in cases of late reporting;

(6) whether lay evidence is likely to be of assistance in addressing late reporting of symptoms by plaintiffs.

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7 tips for dealing with insurance claims

7 tips for dealing with insurance claims

If you’re reading this, you’ve probably either had a bad experience with an insurer or you know someone who has. On a daily basis I receive calls from individuals and businesses who are in a dispute with their insurer about cover extending to a claim or the value of the claim.

There is good news. As an insured, there are things that you can do to give yourself the best shot at your claim being paid, without setting one foot inside a Court room. For most insureds, litigation is expensive and they would be far better off resolving a claim out of Court.

Tip 1: Keep a record of conversations

If you’ve ever called an insurer you will have heard a message which tells you that the call is being recorded for ‘quality and training purposes’.  The record keeping of an insurer (like many organisations) is not foolproof. For this reason, you should keep a record of all calls that you have with the insurer. Keep a record of the date and time of the call, the person you spoke to and the content of the discussion. If something important is discussed, follow up the discussion with an email to the insurer confirming the discussion and the information that they provided.

Don’t record your telephone call using an app on your mobile or a device which is attached to your phone. It is unlawful to record a telephone call with a device physically attached to the telephone and this may include an app on your mobile: Telecommunications (Interception) Act 1979 (Cth). In Queensland, it is lawful for a telephone call to be secretly recorded by an external device (like a dictaphone or an app on a computer) by a person who is a party to the conversation: section 43, Invasion of Privacy Act 1971 (Qld). If you are outside of Queensland, you should check the laws in your State or Territory about recording of conversations.

Tip 2: Get your policy documents

The starting point for any claim is to consider the wording of your insurance policy. In particular, you will need a copy of your schedule of insurance and policy wording (Product Disclosure Statement). You can request these from your insurer or insurance broker.

Most people look no further than their policy wording. You need to read the schedule of insurance with the policy wording. The schedule of insurance talks to the policy wording – it’s like using a key for a map, your schedule of insurance helps you understand how the policy operates for YOU. The policy wording is the same for many insureds but the schedule of insurance explains how you are covered.

Tip 3: Prove your claim and then prove it again (if necessary)

If you make a claim against your insurance – you are required to prove your claim and co-operate with your insurer. This means that you need to provide information to the insurer about the circumstances of the loss and its value. The types of documents and information you should provide vary from claim to claim. Some of the documents you could gather to prove your claim may include: a police report; statements; photographs; invoices; quotes; and, expert reports. Damaged items should not be disposed of if they are relevant to your claim.

Your insurer may appoint a loss adjuster or investigator to consider the value of your claim and whether the loss falls within the cover provided by the policy. Generally speaking, anyone appointed by the insurer to investigate the claim is an agent for the insurer. You should undertake your own investigations with third parties to consider whether the claim has been properly assessed. The cost of doing so may be recoverable against your insurer as ‘claims preparation costs’, however, policies generally require insureds to seek approval from the insurer before incurring these costs.

Once you have gathered as much documentation as possible and you have provided that to your insurer, the insurer may still have concerns. Depending on their response it may be necessary to provide more information or documents in support of your claim.

Tip 4: Request documents

You should request (in writing) copies of all documents that the insurer receives from third parties like reports, quotes, statements, invoices, photographs. You should also request copies of transcripts or audios from conversations with insurers if you think that you have been provided with inconsistent information during the claim process or, when you first placed your cover.

Many insurers subscribe to the 2014 General Insurance Code of Practice. See the full list of insurers subscribed to the Code here. The Code states that insurers will provide copies of reports and other information relevant to a decision to deny cover in certain circumstances. Click here to read a copy of the Code.

Tip 5: Make a complaint

If you are dissatisfied with how your claim is managed or with a decision by your insurer, you can submit a complaint. Your policy will outline the complaints process and should state a telephone number, address and/or email address for this purpose.

I often here from people that they are dissatisfied with the quality of communication from the insurer or the insurer’s agent – e.g. they weren’t provided with adequate information, their calls weren’t returned or they were required to speak to someone new every time they called the insurer. These are legitimate concerns by customers of any organisation and insureds are right to raise them with their insurers. However, it is important to get to the heart of the issue and to identify what is stopping your claim from being accepted or paid. If you cannot work out what the issue is – seek clarification from your insurer and/or advice from your broker, or an independent solicitor.

Once you have submitted your complaint, wait for the complaints resolution period to expire. If it expires and you do not hear from the insurer – follow them up in writing and by telephone. If the complaint does not lead to the claim resolving to your satisfaction, the complaints process should give you more of an idea about the insurer’s concerns.

Tip 6: Seek advice early

I speak to insureds at all stages of their claims. Some people contact me immediately after an event; some contact me years afterwards. Generally speaking, the sooner insureds obtain professional advice from their insurance broker or an independent solicitor, the better.

Tip 7: Request an internal review

An internal review is an opportunity for an insured to ask their insurer to review their decision about a claim and consider the claim again. You may provide the insurer with new information or evidence to consider. Your policy will explain the timeframes within which your insurer is required to make a determination. It is appropriate to seek legal assistance with preparing submissions to the insurer in support of your claim.

Next steps

Once the insurer has internally reviewed its decision, you should seek legal advice about the most appropriate next step in your matter (if you have not already done so). The next appropriate step may be to apply to the Financial Ombudsman’s Service, start proceedings in the Court or apply to the Court for declaratory relief.

Dealing with insurance claims can be particularly stressful and for most insureds it is a foreign experience. It is important to speak to an experienced solicitor or, your insurance broker, at an early stage to ensure that your rights and interests are properly protected.

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What is a trip hazard?

What is a trip hazard?

Case note: The Thistle Company of Australia Pty Ltd v Bretz & Anor [2018] QCA 6

A service station owner has been unsuccessful in its appeal of a decision of the District Court of Queensland to award $96,000 to a man who tripped on the plinth of a petrol bowser. The decision by the Queensland Court of Appeal provides some insight into what a court might consider a trip hazard to be in a public liability claim.

The accident happened in 2012, when the man was aged 80.


Mr Bretz attended the service station and filled his van and 2 x 20 litre drums with fuel. He was unfamiliar with the servo but CCTV footage showed that he spent several minutes walking around the bowser area. As he was doing so, he was looking down and his feet were close to the plinth of the bowser at times. When he finished he ‘took off to walk around the bowser, and the next thing [he] knew [he] was heading for the bitumen’.  Mr Bretz tripped or lost his footing when the ball of his foot hit the edge of the plinth.

The petrol bowser was centred on a raised concrete platform or plinth. The plinth extended 30cm from the edge of the bowser and was 37mm – 39mm high. It was painted black just two weeks prior to Mr Bretz’s fall. Before that it was yellow. It was repainted because the yellow paint was wearing off and there had been customer complaints about the slipperiness of the plinths.

Mr Bretz brought proceedings in negligence against the service station owner, The Thistle Company of Australia Pty Ltd (the TCA). The TCA brought a claim against Tam Farragher & Associates Ltd (TFA), who designed the concrete plinth.

Mr Bretz succeeded in his claim in negligence against the TCA in the District Court. The TCA failed in its claim against TFA, who had an exclusion clause in their favour. The TCA appealed the decision to the Queensland Court of Appeal.

The Appeal

The TCA challenged the following findings of the District Court:

(1) the plinth was not an ‘obvious risk’;

(2) the risk was ‘not insignificant’;

(3) Mr Bretz was not contributorily negligent;

(4) TCA’s third party claim against TFA should be dismissed.

The finding that the plinth was not an ‘obvious risk’

The TCA argued that the trial judge ought to have found that the plinth was an ‘obvious risk’ within the meaning of section 13 of the Civil Liability Act 2002 (Qld) and that it had no duty to warn Mr Bretz of its presence. The Court rejected the TCA’s argument because:

(1) the repainting of the plinth camouflaged it;

(2) the rise of the plinth was only 37mm. It was ‘high enough to trip someone, but not so high to be immediately apparent’;

(3) the plinth was difficult to see because it was located close to where customers would park;

(4) the trial judge appropriately determined that the risk was not ‘obvious’ to a reasonable person in the position of Mr Bretz having regard to the shallow nature of the plinth, that it was an unusual feature of the site, Mr Bretz’s limited experience of the site and that it was camouflaged.

The finding that the trip risk was ‘not insignificant’ 

The TCA contended that the trial judge should have determined that the risk of tripping on the plinth was insignificant. Under section 9 of the CLA a person does not breach a duty to take precautions against a risk of harm unless (among other things) the risk was ‘not insignificant’.

There had been multiple complaints about the slipperiness of the original surface. The only complaint about the plinth after it was painted was the complaint by Mr Bretz. The trial judge found that there was evidence that others had tripped or slipped because of patterns of wear on the plinths.

The TCA argued that the trial judge conflated the episodes of complaint about slipperiness with that of tripping. The Court rejected the TCA’s criticism of the trial judge’s reasoning and noted:

(1) a customer tripping and falling at a service station was one of the business’s highest operational risks;

(2) there was no operational reason to make the plinth the same colour as the surrounding ground beyond the aesthetic. The removal of the visual cue increased the risk of falling, and with a risk of falling, comes a risk of serious injury;

(3) the very risk which eventuated was one which was identified prior to the incident;

(4) it was open to the trial judge to find that once the plinth was painted black, other patrons had stumbled or tripped on it.

No contributory negligence by Mr Bretz

The TCA complained that there should have been a finding that Mr Bretz was contributorily negligent because he was not looking where he was walking. The basis of the TCA’s complaint was that Mr Bretz’s own evidence suggested a cavalier attitude on his part, because in cross-examination there was this exchange: ‘Did you watch where you were walking?– No. Take off and walk’.

The Court was satisfied that it was open to the judge at first instance to find that Mr Bretz’s conduct was ‘mere inattention’ and so, no finding of contributory negligence should follow. The Court was satisfied with the approach of the trial judge and observed the submission made on behalf of Mr Bretz that, ‘as a general rule, pedestrians are not obliged to watch their feet to avoid unexpected obstructions as they walk’.

Dismissal of third party proceedings 

The TCA had a contract with TFA who designed the plinth. The contract contained an exclusion clause in favour of TFA which read:

‘After the expiration of one (1) year from the date of the invoice in respect of the final amount claimed by [the TFA] pursuant to clause 4, [the TFA] shall be discharged from all liability in respect of the services whether under the law of contract, tort or otherwise.’

The TCA alleged that if the plinth was a tripping hazard, it was because it had been negligently designed by the TFA. The trial judge found that the TFA was protected from liability by operation of the exclusion clause. On appeal, the TCA argued that the TFA should be liable because:

(1) there was no evidence that the period of one (1) year in the exclusion clause had expired;

(2) the TFA failed to ensure, through inspection, that the plinths were constructed in accordance with their design and this amounted to a breach of contract;

(3) the TFA’s liability did not arise ‘in respect of the services provided under the contract’ and therefore fell outside of the exclusion clause.

The Court dismissed the TCA’s complaint about the third party proceedings noting that this was not the TCA’s case at trial, that the TCA’s complaint was clearly ‘in respect of the services’ that had been contracted from TFA and finding that the exclusion clause operated to protect TFA from liability. There was no basis to doubt the trial judge’s finding that the one (1) year period under the exclusion clause had expired.


This judgment will be of interest to business owners. In answer to the question of what a trip hazard is, some take away points from this case are that, in the context of a personal injury claim, a trip hazard might be one which has some of the following features:

(1) it is ‘high enough to trip someone, but not so high to be immediately apparent’;

(2) it is camouflaged by surrounding surfaces;

(3) it is hard to spot because of the presence of other objects;

(4) it has caused others to slip or trip on it;

(5) has been identified as a risk already by the occupier.

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Pool tragedy caused by failure to warn of diving danger

Pool tragedy caused by failure to warn of diving danger

Case note: Lennon v Gympie Motel [2016] QSC 315

The Supreme Court of Queensland found the Gympie Motel 85% liable for injuries suffered by a girl who was rendered tetraplegic after diving into the Motel’s pool. The decision (delivered on 22 December 2016) is a timely reminder that businesses with pools and swimming facilities must take appropriate care for the safety of users. The judgment may also be used as a guide for businesses when considering the types of signage to display to adequately warn entrants of a risk of injury from diving.

The accident happened in 1998, when the girl was aged 12.

The Facts

On 21 February 1998, Karla Lennon, her mother and siblings stayed at the Motel. The family had not stayed there before.

The Motel had an in-ground pool. The pool was 10 metres by 5.2 metres, with an internal width of 4.5 metres. Its depth went from 0.9 metres to 1.74 metres. The pool was fenced.

There was a sign on the gate to the pool area which read:

‘Pool Rules

All children must be under adult supervision at all times, in pool area.’

On arriving at the Motel, Karla’s younger sister Letitia asked their mother if she could go swimming. The mother agreed and told Letitia that Karla would be in charge.

Letitia recalled that she and Karla were jumping in from different areas around the pool and gliding, to see how far they could each glide along. Letitia recalled other people present in the jacuzzi area of the pool and had a conversation with one of the people.

At one point a man said to Letitia, ‘…your sister is over there and she’s floating…’. Letitia told the man that Karla had done this before and that she was just playing a joke. The man left the pool area. Letitia realised that Karla was not responding. Emergency services attended. Karla suffered a ‘hypoxic brain injury secondary to immersion due to a cervical spine injury’.

Letitia (who was 7 years of age at the time) gave evidence about the circumstances leading up to the incident at the trial. There was no direct evidence at trial about the incident. Karla had no recollection of the event.

The Plaintiff’s Case

It was Karla’s case that:

(1) she knew not to dive into shallow water or pools in which she could not judge the depth;

(2) she intentionally dived into the pool, striking her head, and did not appreciate the depth of the pool;

(3) the Motel failed to warn her about the depth of the pool by having a ‘no diving’ sign or depth markers, or both;

(4) if the Motel had erected signage, warning users of the pool as to either its depth or that diving was prohibited, Karla would not have dived into the pool.

The Defendant’s Case

It was the Motel’s case that:

(1) there was insufficient evidence for the Court to conclude how Karla’s injuries occurred;

(2) the absence of depth markers or a no diving sign did not constitute a breach of duty because of the obviousness of the risk of diving into the pool;

(3) Karla was outgoing, oppositional and, even if a no diving sign or depth marker were present, she would have done exactly what she did;

(4) the foreseeability of any risks of injury were adequately addressed by the sign requiring adult supervision;

(5) Karla contributed to her own injuries.

The Judgment

Both parties led evidence about Karla’s character. The Court ultimately accepted submissions made on Karla’s behalf, that she was a responsible and mature child. In arriving at this conclusion, the Court took into account that:

(1) Karla had previously travelled by train, bus and water taxi to Stradbroke Island for 2 years prior to the incident, every weekend, during the school term and, without adult supervision;

(2) Karla worked in her mother’s second-hand store, serving customers, for up to three to four hours;

(3) Karla would travel with her father, who owned a trucking and logistics business, and she would take messages and write cheques; and

(4) Karla’s friend’s mother allowed Karla and her daughter to swim, unsupervised, at the beach.

The Court was satisfied, on the balance of probabilities, that Karla’s injuries were in fact caused by her diving into the pool and striking her head on the bottom of the pool. In arriving at this conclusion, the Court relied heavily upon the opinion of Dr Tuffley, who considered it was ‘highly probable, and certainly more probable than not’, that this was the cause of Karla’s injury.

The Court accepted that if the Motel had displayed a no diving sign, that Karla would have obeyed that warning. This was despite the fact that it was Karla’s evidence that she would have obeyed an instruction from her mother not to dive into the pool. Having regard to her character, the Court did not consider it was unreasonable for Karla not to be supervised by her mother in the pool.

The Court found that the duty of care owed by the Motel to Karla extended to take care for the safety of the persons using the pool and that the Motel breached its duty of care by failing to take the precautions (of displaying a no diving sign or a depth marker, or both) to warn guests who may misjudge the depth of the pool. Displaying the adult supervision sign did not discharge the Motel’s duty to the Plaintiff in this instance. The Court had regard to Australian Standards which state that, ‘[u]nless specifically designed for diving, private pools should not be used for that purpose’ and accepted the Plaintiff’s submission that there was no safe place to dive in the pool.

A deduction of 15% was allowed for the Plaintiff’s own negligence, having regard to the fact that while she was found to have dived in the deeper area of the pool and had been diving safely into the pool without incident for 10-15 minutes beforehand, she had a general awareness of the dangers associated with diving.


This judgment will be of interest to pool owners and businesses with swimming facilities. The decision may be used as authority for the kinds of precautions that may be reasonably required of a commercial facility to address the risk of people diving into shallow water. However, it should not be taken as authority for the proposition that an absence of parental supervision will be superseded by an owner’s failure to warn of risks. The disposition of the Plaintiff was a key feature of the judgment in this case. There have been changes in the law since this incident occurred and similar circumstances, with a Plaintiff of a different maturity level, could produce a different result.

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InDefence covers legal and technical issues in a general way. Changes in circumstances or the law may affect the completeness or accuracy of the information published. InDefence is not designed to express opinions on specific cases, to provide legal advice or to establish a relationship of client and lawyer between Denning Insurance Law and the reader, or any third party. No person should act or refrain from acting solely on the basis of this publication. You should seek legal advice particular to your circumstances before taking action on any issue dealt with in this blog.