In January 2020 in Newcastle Kayne Gilmore was injured while on court between games at a tournament of a modified form of basketball, which is played on half of a basketball court. He claims that the tournament was conducted by the Trustee for Australia 3x3 Hustle Discretionary Trust, trading as 3x3 Hustle, and that he was injured while standing facing away from the basketball stand when the basket, backboard, and supports all fell and hit him on the head, the stand not having been properly secured. Mr Gilmore seeks damages for the serious injuries he suffered as the result of the breach of the duty of care he claims 3x3 Hustle owed him, and the negligence which resulted in him suffering the physical and psychiatric injuries and other damages he sustained as a result of the blow to his head.
Mr Gilmore's claims are defended by 3x3 Hustle, which says that in order to participate in the tournament, players must purchase a yearly membership in its organisation. Such membership involves an agreement that members use its products at their own risk, it having no liability or responsibility for any personal injury or property damage of any nature resulting from their access to or use of its products and services. Further, that the competition at which Mr Gilmore was injured was organised and hosted by Playgrounds Park Pty Ltd, not it. In the result it owed him no duty of care on the occasion when he was injured and that if it did, it had not breached that duty and was not responsible for any of the pleaded negligence, the injuries which he suffered or the damages which he pursues.
This judgment deals with a motion brought by Mr Gilmore seeking leave under s 5 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW) to join and proceed under a proposed amended statement of claim against Berkley Insurance Company Ltd, trading as Berkley Insurance Australia, Playgrounds' insurer at the relevant time. 3x3 Hustle consents to the orders sought, but the Court must be satisfied that its discretion to grant the leave sought may be granted. Given the parties' agreement, the motion was dealt with on the papers.
Section 5 gives the Court the discretion to grant the leave sought before or after proceedings under s 4 are brought. It permits recovery from an insured person's insurer in proceedings before a court in circumstances where the insured person has an insured liability to a claimant. The insurer standing in the place of the insured person as if the proceedings were proceedings to recover damages, compensation, or costs from the insured person.
Mr Gilmore seeks the required leave in circumstances where, after he was injured, Playgrounds was deregistered and there is no issue between the parties that there is no prospect of any recovery from it.
Mr Gilmore relied on an affidavit sworn by Ms Lee, 3x3 Hustle's solicitor, who deposes that in September 2019 it had entered an agreement with Playgrounds to assist it in the conduct of the competition; that Playgrounds had later received funding from the City of Newcastle and Lake Macquarie City Council; and it had purchased the basketball ring and associated equipment which it had erected at the competition venue where Mr Gilmore was injured.
The proposed pleading relies on the terms of Playground's public liability insurance policy, which provided cover for personal injury to any person. Berkely has advised that it denies indemnity and will rely on cls 4.15.1, 4.1.4.2 and a schedule to the policy which excludes participation in basketball activities, to resist any claim pursued against it. Its liability will thus depend on the proper construction of the policy, approached in the way discussed in Selected Seeds Pty Ltd v QBEMM Pty Limited [2010] HCA 37; (2010) 242 CLR 336 at [29] and Darlington Futures Ltd v Delco Australia Pty Ltd [1986] HCA 82; (1986) 161 CLR 500 at 510-511.
Mr Gilmore's case is that the game played at the tournament at which he was injured was not basketball, but a non-contact modified form of that game, which fell within the exception to the exclusion in cl 4.15 of the policy, with the result that if Playground were still registered, it would be entitled to indemnity under the policy. In any event, his injuries were not the result of his participation in the game, but the failure to properly install the equipment which fell on him. Such an event was not covered by any exclusion in the policy.
It followed that he had established both the required arguable cases against Playground; that its insurance policy responded to his claim and that there was a real possibility that if he obtained judgment, Berkley would be liable to meet it: see Zaki v Better Buildings Constructions Pty Ltd [2017] NSWSC 1522; Murphy, McCarthy & Associates Pty Ltd v Zurich Australian Insurance Ltd [2018] NSWSC 627; Ritchie v Advanced Plumbing and Drains Pty Ltd [2019] NSWSC 1028; and Wigge v Allianz Australia Insurance Ltd [2020] NSWSC 150.
3x3 Hustle accepted this. Its case was that Mr Gilmore had discharged the burden of establishing that he had an arguable case against Playground to which Berkley's policy ought to respond, Playground being unlikely to be in a position to meet any judgment against it. Further, at trial it would be for Berkley to establish that it was entitled to disclaim liability: Cobie Ann Moore v Richard McKiernan [2017] NSWSC 1520 at [69].
On its approach, giving an objective and commercial business-like interpretation to the policy would result in the conclusion that the policy exclusions did not apply, the cause of Mr Gilmore's injury not being his participation in the competition, but the incorrect construction and/or installation of the equipment which fell. Further, that the exclusions were concerned with participant v participant exclusions, that following from the obvious conclusion that if the equipment had fallen on a spectator, the exclusions would not have been engaged.
All that Mr Gilmore had to establish being that it was arguable that the policy responded to his claim, it was also relevant that Berkely had not sought to lead evidence or be heard on the motion. Playground being deregistered, it thus supported Mr Gilmore's motion.
[2]
The orders sought must be made
On the cases which the parties advanced in the undisputed circumstances in which Mr Gilmore was injured, I am satisfied that he has met the onus which falls upon him, with the result that the leave he seeks must be granted.
That there is no prospect of any recovery from Playgrounds is not in issue. It appears that Mr Gilmore was injured by the equipment which collapsed while he was faced away from it. This establishes that he has an arguable case against Playgrounds. The construction of its insurance policy, which both parties advance, is plainly arguable.
In the result, it must also be accepted that Mr Gilmore has established that there is a real possibility that if he obtains judgment against Playgrounds, Berkley would be liable to meet it, despite the approach it has advised it takes to the construction of the policy.
Mr Gilmore does not appear to have been playing the game when he was injured; the tournament did not involve the playing of basketball, but a modified version of that game, which did not permit player contact; and it was not playing the game which resulted in his injury, but the failure of the equipment which fell and struck Mr Gilmore while he was standing with his back to it. That this was not covered by any exclusion is clearly an available construction of the policy.
It follows that the requirements for the grant of the leave sought have been satisfied.
[3]
Costs
The usual costs order under the Uniform Civil Procedure Rules is that costs follow the event. In this case both parties took the same position in respect of the leave which Mr Gilmore required.
In the circumstances I consider that the just costs order is that the costs of the motion be costs in the cause.
[4]
Orders
For these reasons I order, in terms agreed by the parties, that:
1. The Hearing on 3 November 2023 be vacated.
2. Leave is granted for Berkley Insurance Company trading as Berkley Insurance Australia (Berkley) to be joined to the proceedings pursuant to section 5 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW).
3. The Plaintiff is granted leave to file an Amended Statement of Claim to give effect to order 2 by 10 November 2023.
4. Plaintiff's and Berkley's costs of the Notice of Motion dated 22 May 2023 (Motion) are costs in the cause.
5. Defendant's costs of the Motion are reserved.
[5]
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Decision last updated: 10 November 2023
Parties
Applicant/Plaintiff:
Gilmore
Respondent/Defendant:
The Trustee for Australia 3x3 Hustle Discretionary Trust trading as 3x3 Hustle