A party in a contract might be required to indemnify the other
party. While this seems straightforward, it can lead to double
insurance and some complex problems. The WA Court of Appeal's
decision in Speno Rail Maintenance Australia Pty Ltd v Metals
& Minerals Insurance Pte Ltd [2009] WASCA 31 (6 February
2009) gives some guidance about how these complex arrangements
work, and the operation of section 45 of the Insurance Contracts
Act.
Speno entered into a contract with Hamersley, under which it was
obliged to indemnify Hamersley for any common-law claims for
personal injury to Speno's employees engaged in contract works,
and any liability arising from the performance of the works. Speno
was also required to arrange liability insurance to cover
Hamersley's interest as a principal, which it did. Hamersley
however also had its own insurance. A worker was injured due to
Hamersley's negligence and sued, triggering the policy - and an
avalanche of litigation between the
