Civil Liability (Third Party Claims Against Insurers) Act 2017 No 19



An Act to make provision with respect to claims against insurers by third parties.
2   Commencement
This Act commences on the date of assent to this Act.
3   Definitions
(1)  In this Act:
claimant—see section 4.
court means a court or tribunal of New South Wales.
insured liability means a liability in respect of which an insured person is entitled to be indemnified by the insurer.
insured person means a person who is, in respect of a liability to a third party, entitled to indemnity pursuant to the terms of a contract of insurance, and includes a person who is not a party to the contract of insurance but is specified or referred to in the contract, whether by name or otherwise, as a person to whom the benefit of the insurance cover provided by the contract extends.
liability means a liability to pay damages, compensation or costs.
Note—
The Interpretation Act 1987 contains definitions and other provisions that affect the interpretation and application of this Act.
(2)  Notes included in this Act do not form part of this Act.
4   Claimant may recover from insurer in certain circumstances
(1)  If an insured person has an insured liability to a person (the claimant), the claimant may, subject to this Act, recover the amount of the insured liability from the insurer in proceedings before a court.
(2)  The amount of the insured liability is the amount of indemnity (if any) payable pursuant to the terms of the contract of insurance in respect of the insured person’s liability to the claimant.
(3)  In proceedings brought by a claimant against an insurer under this section, the insurer stands in the place of the insured person as if the proceedings were proceedings to recover damages, compensation or costs from the insured person. Accordingly (but subject to this Act), the parties have the same rights and liabilities, and the court has the same powers, as if the proceedings were proceedings brought against the insured person.
(4)  This section does not entitle a claimant to recover any amount from a re-insurer under a contract or arrangement for re-insurance.
5   Leave to proceed
(1)  Proceedings may not be brought, or continued, against an insurer under section 4 except by leave of the court in which the proceedings are to be, or have been, commenced.
(2)  An application for leave may be made before or after proceedings under section 4 have been commenced.
(3)  Subject to subsection (4), the court may grant or refuse the claimant’s application for leave.
(4)  Leave must be refused if the insurer can establish that it is entitled to disclaim liability under the contract of insurance or under any Act or law.
6   Time for commencing proceedings
(1)  Proceedings to recover an amount from the insurer under section 4 must be commenced within the same limitation period that applies under the Limitation Act 1969 or other Act to the claimant’s cause of action against the insured person in respect of the insured liability.
(2)  Subsection (1) does not apply if the claimant has brought proceedings against the insured person in respect of the insured liability before the expiry of the limitation period applying to those proceedings, including any extension of the limitation period granted under the Limitation Act 1969 or other Act by a court.
7   Matters on which insurer may rely
In proceedings brought under section 4, the insurer is entitled to rely on any defence or any other matter in answer to the claim or in reduction of its liability to the claimant:
(a)  that the insurer would have been entitled to rely on in a claim made by the insured person under the contract of insurance, or
(b)  that the insured person would have been entitled to rely on in proceedings brought by the claimant against the insured person in respect of the insured liability.
8   Judgment against insured person no bar to claim against insurer
A judgment or order for damages, compensation or costs in favour of the claimant against the insured person in respect of an insured liability does not prevent the claimant from recovering an amount for the damages, compensation or costs under section 4, except to the extent that the judgment or order has been satisfied.
9   Discharge of insurer’s liability
Any payment made by the insurer to the claimant under this Act in respect of an insured liability discharges, to the extent of the payment, the liability of the insurer to make a payment to the insured person under the contract of insurance in respect of the insured liability.
10   Effect of payments made by insurer to insured person
An insurer’s liability to a claimant under this Act is not reduced, discharged or otherwise affected by:
(a)  any compromise or settlement between the insurer and the insured person in respect of the insured liability, or
(b)  any payment by the insurer to the insured person in respect of the insured liability unless and to the extent that the amount of the payment is or has been paid by the insured person to the claimant in respect of the insured liability.
11   Application of Act
The rights conferred on claimants under this Act do not affect, and are in addition to, the rights conferred under the Workers Compensation Act 1987 or any other law on a person who is not a party to a contract of insurance to make a claim against an insurer in respect of an insured liability.
12   Preservation of existing proceedings
Section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (as in force immediately before its repeal by this Act) continues to apply to actions brought against insurers under that section before the commencement of this Act as if that section had not been repealed.
Schedule 1 (Repealed)
sch 1: Rep 1987 No 15, sec 30C.