TPD Insurance Matter Referred Back to the District Court After an Appeal

On 8 September 2022 the Court of Appeal handed down a unanimous decision regarding Limitations in Insurance Contacts: Ali v Insurance Australia Limited [2022] NSWCA 174. This case particularly considered a previous case on Limitations: Globe Church Incorporated v Allianz Australia Insurance Ltd [2019] NSWCA 27.

1. Background

Under the Limitations Act 1969 (NSW), matters generally have a limitation period of 6-years (at s14), and insurance contract matters mostly fall under that general 6-year period.

In the Globe Church there was a question as to when limitation would accrue. That case involved an insurance contract for property damage and the question there was whether limitations accrued from when the damage occurred (that would have been outside 6-years) or when the insurer declined to pay (within 6-years).

By a narrow margin of 3:2 the majority of Bathurst CJ, Beazley P, and Ward JA (as they each then were) decided that limitations accrued from when the damage occurred (from the event) and NOT from when the insurer ostensibly breached by declining to pay. Meagher and Leeming JJA dissented.

2. Ali v Insurance Australia Limited

In Ali, Mr. Ali was insured under home and contents insurance, and he had suffered a break-in on 9 October 2013, and he made a claim on his home and contents insurance which was denied on 20 May 2014. Proceedings were commenced 16 October 2019 and the insurer argued the limitations accrued from 9 October 2013 and accordingly the matter would be statute barred. The primary judge agreed with the insurer.