Thus it was put that the evidence justified the finding that it was the common intention of the parties to the insurance contract that Allianz would provide indemnity in respect of the seven works including the plaintiff's, and the schedule and policy should be rectified to record that agreement.
44 Counsel for the defendants first submitted that the plaintiff had no standing to seek an order for rectification as she was not a party to the contract for insurance. He referred to Brunker v Perpetual Trustee (1937) 59 CLR 140. However his main submissions were directed to demonstrate the lack of evidence of a common intention to provide insurance in respect of the plaintiff's contract.
45 He submitted that the correspondence prior to the issue of the policy should be understood to have proceeded on the basis of the truth of the representations in the application of 10 September 2001 that no contract had been entered into, and that the company would advise if circumstances changed. Consistently, the correspondence makes plain that the parties treated the values as estimates in circumstances where no information was provided by the company of contracts entered into and of actual contract values. It was said that a relevant example is the facsimile of 6 November 2001 in which HK responds to Dexta's quotation and requests the issue of certificates in respect of the works. It is noteworthy that those works are identified only by estimated values; the insurer is not informed of the date of the contracts under which the works were to be done.
46 The defendants also relied upon the acceptance by the company, without demur, of the certificates and policy documents which were sent to HK by Dexta on 20 November 2001 after the policy was issued and in which, inter alia, were included statements to the effect that insurance was in respect of contracts entered into during the policy period, and that the retroactive date was 16 November 2001. They also rely on HK's letter of 23 November 2001 in which the company was advised to check the policy and certificates and to notify disagreement with any details, and the apparent lack of response to it.
Finding
47 In considering the rectification issue I have assumed, without deciding, that the plaintiff has standing to seek the relief claimed.
48 In order to succeed the plaintiff undertook to provide clear and convincing evidence that both the company and the insurer intended that the policy period should commence on 27 September 2001, alternatively that this date be the retroactive date, thereby entitling the plaintiff to indemnity. Thus it was for the plaintiff to prove that the policy did not express the agreement of the parties.
49 In my opinion the documentary evidence negates the basis of the plaintiff's claim, and makes plain the agreement of the parties was as expressed in the terms and conditions of the schedule and the policy and, accordingly, the claim for rectification should be declined.
50 The correspondence shows that Dexta acted in accordance with the information provided in the application of 10 September 2001 and, absent information otherwise, was entitled to assume that the contracts for which estimated values were stated had not been entered into prior to the time the policy was issued. The plaintiff accepts that the insurer was not made aware of the date of the plaintiff's (or of any) contract until well after the policy was issued. She made no submission that the policy was inconsistent with the application or other information provided by the company.
51 To demonstrate the company's agreement with the terms and conditions of the policy it is sufficient to refer to the following.
52 On 20 November 2001 Dexta sent to HK the contractor's certificate of currency and the schedule. Later the same day it sent by separate post the certificate of currency and the policy documentation, the relevant details of which are set out in paras 17 and 18 above. On or about 21 November 2001 HK sent a policy summary and tax invoice for the premium for the policy, the details of which are set out in para 19 above. The documents state plainly that the period of cover is from 16 November 2001 to 16 November 2002, and that the insurance covers all major residential building work for which a contract is entered into during the policy period. The retroactive date is stated to be 16 November 2001. It is common ground that the premium was paid.
53 On 23 November 2001 HK sent, for Mr Monti's attention, the certificate of currency noting that the policy was effective from 16 November 2001. On the same day it sent to the company the letter the terms of which are set out in para 20 above. Significantly, the letter records that the cover was placed in accordance with the company's instructions, and advises of the necessity to check and review the policy paying particular attention to its terms, conditions, and exclusions. It invited immediate notification of disagreement with any details.
54 As indicated in the letter, these documents were required before the company could lawfully proceed with building work under the Act. Relevantly, s 92(1) provides:
"92(1) A person must not do residential building work under a contract unless:
(a) a contract of insurance that complies with this Act is in force in relation to that work in the name of the person who contracted to do the work, and
(b) a certificate of insurance evidencing the contract of insurance, in a form prescribed by the regulations, has been provided to the other party (or one of the other parties) to the contract.
Maximum penalty: 1,000 penalty units in the case of a corporation and 200 penalty units in any other case".
55 According to the plaintiff, on about 23 November 2001 Mr Monti gave her a copy of the certificate of currency and of the owner's certificate. The details of the owner's certificate are set out in para 21 above. There is no reason to think that he did not read and understand them. By providing the certificate to her he purported to fulfil the requirement of s 92(1)(b) of the Act and cl 25.6 of the contract with the plaintiff. Apparently on the assumption that it held a contract of insurance which complied with the Act which was in force in relation to that work as required by s 92(1)(a) of the Act and cl 25.2 of the contract the company commenced work at the property a few days later.
56 These matters establish, in my opinion, the acceptance by the company of the terms and conditions of the policy, and that the schedule and policy accurately recorded the agreement of the parties to the insurance contract at the time it was made. In the circumstances there can be no rational basis for doubting that Mr Monti and other relevant officers of the company were aware of, and accepted, that the policy period commenced on 16 November 2001, that the insurance for which the premium was paid covered contracts entered into during the policy period, and that the retroactive date was 16 November 2001. The company's agreement is further demonstrated by Mr Monti's conduct in providing the plaintiff with the owner's certificate in purported discharge of its statutory and contractual obligations, and commencing work at the property.
57 Furthermore, it is the inevitable inference from the conduct of the company in doing or saying nothing thereafter to suggest otherwise that it accepted the policy as a valid contract with the insurer.
58 There is nothing in the evidence which indicates that the insurer intended to cover a contract entered into outside the policy period. This is not surprising as it was never informed by the company that there existed such a contract for which insurance was sought. Thus it came about that the policy documents which specified the policy period for contracts in respect of which cover would be provided were submitted to the company for its consideration. These were the terms and conditions which the company accepted and acted upon. For the above reasons I am unpersuaded that the evidence relied upon by the plaintiff provides any support for an order for rectification of the schedule and policy as sought. This conclusion makes it unnecessary to decide the question of the plaintiff's standing.
The application for judgment under Pt 18, r 3
59 Part 18, r 3(1) provides:
3(1) Where admissions are made by a party, whether by his pleading or otherwise, the Court may, on the application of any other party, give any judgment or make any order to which the applicant is entitled on the admissions".
60 The plaintiff submitted that she was entitled to judgment on the admissions contained in the defence to the second further amended statement of claim. The application was left until after the defendants' counsel had completed his submissions on the construction and rectification issues (T p 134). It was submitted that the effect of the admissions precluded denial of liability of the plaintiff's claim for indemnity, regardless of the proper construction of the terms and conditions of the policy. It was put that the plaintiff was entitled to a verdict on the following admissions recorded in Exhibit C.
3(b) The Builder obtained a policy of Home Warranty Insurance from Dexta, for and on behalf of Allianz, on or about 16 November 2001 in respect of the building work to be carried out at Ms Taylor's property ('the Building Works') (Para 10 claim, 11 defence)
(c) Dexta, on behalf of Allianz issued Building Owner's Home Warranty Insurance Certificate No BAN998-DA002267-01/1/7 dated 16 November 2001 in respect of the Building Works; ('the Certificate') (paras 10, 13 & 15(e) claim, paras 11, 15 & 26 defence)".
61 It is unnecessary to recite the competing submissions in these reasons. They demonstrated that there was a substantial issue concerning the proper construction of numerous paragraphs in the second further amended statement of claim and of the responses to them as pleaded in the defence. Nevertheless, the effect of the denials pleaded left no doubt that the defendants' denied the plaintiff's entitlement to indemnity or rectification on the bases upon which this litigation was conducted. (See eg, paras 14, 16, 22, 24, 28, 29, 33, 36, 37, 53, and 55 of the defence).
62 The power which may be exercised under Pt 18, r 3 is discretionary having regard to the requirements of justice in all the circumstances of the particular case. A party is not entitled as of right to judgment on admissions even in cases where the terms of the admissions are expressed in clear terms or where the fact of them having been made is not in issue. The principles were reviewed in Termijtelen v van Arkel & Anor (1974) 1 NSWLR 525 pp 528-530; pp 532-534. Hope, JA (p 529) expressed the view that if evidence is properly before the court in the same suit the court can act upon the basis of that evidence and refuse to act upon the admissions. Both Hope, JA (p 530) and Bowen, CJ in Eq (p 534) referred with approval to the speech of Lord Loreburn in Gramophone Company Ltd v Magazine Holder Co (1911) 28 RPC 221 p 225 in which he held:
""It is the duty of a Court to decide cases according to the truth and fact, not according to any assumed or artificial state of facts which the parties G may find it convenient to present. No doubt Courts of Law allow and indeed encourage parties to simplify litigation by making admissions and to a certain extent by waiving their rights, because, when there is a real controversy depending upon real facts, everyone ought to facilitate its authoritative settlement. But that is a very different thing from allowing people to obtain A an adjudication upon the footing that something exists or has happened which in truth does not exist, or has never happened ¼ . A Court of Justice can never be bound to accept as true any fact, merely because it is admitted between the parties"."
63 In Damberg v Damberg & Ors [2001] NSWCA 87, Heydon, JA (para 155) observed that there are significant limitations on the extent to which the use of admissions can compel a court to decide a case on a basis contrary to fact. He, too, referred with approval to Lord Loreburn's statement in support of the proposition that the court is not bound to act on admissions made by the parties or on states of fact agreed by the parties (para 157).
Finding
64 In my opinion the proper exercise of discretion requires that the application for judgment be refused. Although it is evident that some of the admissions relied upon may be agreements as to identified facts and limits the need for evidence to prove them, it is also plain from the pleading itself that matters relevant to the core of the plaintiff's claim remained in contest. This being the case, it is unnecessary to endeavour to resolve the issues as to which matter or matters were in fact admitted as claimed. Unsurprisingly, the plaintiff accepted the necessity to prove her case and proceeded to trial in an attempt to do so. Relevantly, although the defence was filed on 7 June 2005, and the hearing commenced on 27 June 2005 and proceeded on the basis that the claim was opposed on all grounds, no application was made until 29 June 2005 after completion of the defendants' final submissions. In my opinion those circumstances are sufficient to justify refusal of the application.
65 Significant additional factors are the conclusions to which I have come on the questions of construction and rectification which inevitably attract the considerations to which Lord Loreburn referred. Having found that upon the proper construction of the policy the plaintiff is not entitled to indemnity, and having declined rectification of the policy documents, in my opinion it would be unjust to make an order to the opposite effect on the basis of the defendants' pleaded admissions.
Conclusion
66 I make the following orders: