Lloyd's Insurance Law Reporter
QBE INSURANCE AUSTRALIA LTD V ALLIANZ AUSTRALIA INSURANCE LTD
[2020] FCA 589, Federal Court of Australia, Chief Justice Allsop, 6 May 2020
Insurance (liability) - Co-insurance - Contribution - Defence costs
In 2010 property developer QIG Property Development Pty Ltd retained Southern Cross Constructions (ACT) Pty Ltd (SX) as its head contractor to undertake building work in Sydney. Pile & Bucket Pty Ltd (PB) was retained by SX as a subcontractor to carry out excavation work. The owners of adjacent property complained of damage to their building caused by the works. In October 2018 PB settled for $676,854.14 damages plus $150,000.00 costs. In 2019 a claim against SX was dismissed. SX had liability insurance with Allianz, expressed to cover SX and all subcontractors. PB had its own liability cover with QBE. Following the settlement QBE paid $826,854.14 to the claimants and incurred a further $700,000 in defending the proceedings in PB's name. QBE sought contribution for the defence costs from Allianz on the basis that Allianz was also the insurer of PB.