December 2015


AILA President’s message
Susan Vidler

Review confirms bad year

KPMG’s General Insurance Industry Review 2015 confirmed what we know – it was not a good year for insurers.

The report found Australian insurers produced an insurance profit of $3.735 billion, down 23.6% from the five-year high of the previous 12 months. KPMG said sustained competition throughout the industry had a significant impact on premiums, the growth rate slowing to almost nil in each of the three quarters to March 2015 before increasing slightly to 1.3% in the June 2015 quarter.

Five natural disasters in 12 months to June 2015 cost the industry about $3.6 billion. Consequently the industry loss ratio increased to 67.2% from a five-year low of 61.6% in 2014.

Insurers revisited investment strategies and ventured into alternative assets as they continued to operate in a low interest rate environment in Australia and globally.

Click here to read the full report.


Leave application refused

In the June 2015 issue of Resolve, we reported on a NSW Appeal Court case involving a Sydney doctor who was seriously injured on a Perisher Blue Pty Ltd ski lift in July 2003.

The Supreme Court had found Perisher liable to Dr Gita Nair-Smith and awarded her almost $1.4 million in damages.

Perisher appealed against that finding and the Appeal Court found it was not open to the primary judge to conclude Perisher’s negligence caused Dr Nair-Smith’s injuries. The Appeal Court allowed the appeal and held:

• The primary judge was correct to have found Perisher breached its duty of care in negligence owed to Dr Nair-Smith;

• The Supreme Court should have found Perisher’s negligence was not causative of the injury she suffered; and

• The action for damages in negligence should have been dismissed, as should the action for damages for breach of contract.

In the Resolve article, Sherryn Russell, an Associate with Winter Hilditch & Fotheringham, said the case was a reminder of how important it was for parties to correctly identify the relevant risk of harm. “When an activity involves many risks, relevant risk will be identified with a higher degree of particularity,” she said.

In the latest development, on October 16, the High Court refused Dr Nair-Smith leave to appeal.


Swimmer unsuccessful on appeal

In the March issue of Resolve, we reported on a case in which a competitive swimmer successfully sued her school for breaching its duty of care after a training incident left her a tetraplegic.

But Emilie Kate Miller’s suit against Lithgow City Council, NSW, owner of the pool where the incident happened, failed because the judge accepted it was not the pool supervisor’s responsibility to intervene in a competitive training program.

On October 15, NSW Appeal Court Justice Mark Leeming, with whom Justices John Baston and Carolyn Simpson agreed, overturned Ms Miller’s yet-to-be calculated award, saying there was no evidence to support a finding against Kinross Wolaroi School, at Orange.

Justice Leeming upheld Acting Justice Robert Shallcross Hulme’s earlier ruling the council was not negligent. He said Ms Miller’s “tragic accident was entirely blameless on her part, but it does not follow that her injury was caused by a breach of duty owed to her by either the school or the council”. (Uniting Church in Australia Property Trust (NSW) v Miller; Miller v Lithgow City Council [2015], NSWCA 320, 15/10/15)


Leave granted for “dangerous recreational activity” case

The application and interpretation of s51 of the NSW Civil Liability Act 2002 (CLA) is being considered by the High Court following a successful special leave application on September 11, 2015, in the case of Stewart & Ors v Ackland. Click here for the High Court documents.

As reported in Resolve’s June 2014 issue, and in my column in the June 2015 issue, Benjamin Ackland suffered a quadriplegia injury when he failed to land a backward somersault on a jumping pillow on October 10, 2009. He pursued a common law action against Patrick Stewart and others as owners and occupiers of the amusement park where the jumping pillow was located.

Mr Stewart was successful in the lower courts, which rejected the “dangerous recreational activity” defence under s51 of the CLA on the basis the risk that materialised was not obvious to a reasonable person in Mr Ackland’s position.

Underwriters and policyholders concerned about cover for claims arising from such activities will welcome the High Court’s clarification of the application and interpretation of the tests under s51, given the uncertainty caused by inconsistent application of the tests in the lower courts.


Ron Shorter award 2016

Following the successful expansion of the Ron Shorter Memorial Public Speaking Award in Victoria this year I am delighted to announce the award will be held in Sydney, Melbourne and, for the first time, Brisbane in 2016.

Initial planning is in progress and applications will open in each state at the end of February, so I encourage you to look out for further announcements early in 2015.


AILA National Conference 2016 - Adelaide

The 2016 AILA National Conference was officially launched at the National Conference in Melbourne. The theme is “Game Changers” and the event is at the Adelaide Oval on October 12 -14. Register your interest in attending at


Season’s greetings

On behalf of the AILA board, I wish all our members best wishes for the festive season. Have a great holiday, stay safe and we look forward to your continued support in 2016.

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Resolve is the official publication of the Australian Insurance Law Association and
the New Zealand Insurance Law Association.