The New South Wales Court of Appeal has affirmed
the decision of the Supreme Court of NSW in Lambert Leasing Inc. v
QBE Insurance Ltd [2015] NSWSC 750.
This decision resolves competing case law on the application of
Section 45 of the Insurance Contracts Act 1984 (Cth) (ICA)
to "other insurance" clauses in contracts of general
insurance. Insurers and insureds need to carefully consider the
application of "other insurance" clauses, especially in
circumstances where insurance is procured pursuant to a contractual
obligation to indemnify or for the benefit of a subsidiary.
Background
In 2003 the appellants, Lambert Leasing, Inc. and SAAB Aircraft
Leasing, Inc. sold an aircraft to Mackellar Mining Equipment Pty
Ltd and Dramatic Investments Pty Ltd (the Partnership). The
Partnership then leased the aircraft to Lessbrook Pty Ltd, trading
as Transair.
