In the recent case of Dalby Bio-Refinery Ltd v Allianz
Australian Insurance Limited [2019] FCAFC 85, the Full Court
of the Federal Court of Australia considered the meaning of the
term "spontaneous" in the context of a perils exclusion
clause.
The plaintiff, Dalby Bio Refinery (Dalby), was
a manufacturer and distributor of ethanol.
On 2 March 2016, fire and emergency services attended
Dalby's bio-refinery in South East Queensland due to smoke
having been detected. Stockpiles of dry distillers' grain and
solubles (product) in four bays showed signs of
possible fire damage. Whilst testing of the product indicated that
it was unlikely to develop into large scale flaming combustion, the
contents of three of the bays were discarded due to having a
"burnt smell" and being discoloured.
