New Zealand’s High Court has dismissed a case in which a lawyer argued he’d made a claim to a global insurance giant under his professional indemnity insurance policy by sending them a spreadsheet.
According to a report by global law firm DLA Piper, John Walters was a lawyer who acted for both vendors and purchasers in transactions concerning a New Zealand investment property group called Blue Chip.
In early 2008, Walters was planning a partnership merger and did not intend to renew his professional indemnity policy with insurer AIG New Zealand beyond 2008. At the time, the Blue Chip group had just collapsed.
As a precaution, Walters compiled a spreadsheet which was forwarded to AIG. It listed all files where he had acted for both Blue Chip and investors on the same transaction.
However, it contained little more than the names and address of the relevant parties, and whether the transaction had settled.
In 2009, two investors who purchased a unit in a Blue Chip residential development commenced proceedings against Walters for breach of fiduciary duties, breach of contract and negligence in acting on a Blue Chip transaction.
In 2013, a judgment was entered against Walters for a sum of NZD$164,259. As a result, Walters made a NZD$270,004 claim under his expired professional indemnity policy as the two investors were one of the clients listed on the spreadsheet sent to AIG.
In order to be covered, Walters needed to have reported the claim to the insurer during the period of insurance. In this case, it came down to whether or not the spreadsheet was notification of a claim.
In this case, the High Court ruled there was insufficient information contained in the spreadsheet to indicate a claim was made.
“What is more, it does not list these clients as purchasers, which might at least suggest potential liability for a solicitor acting negligently when settling a conveyancing transaction,” the Judgement says.
“The application for summary judgment is dismissed.”