In the early hours of September 4, Nicole and Jacques Marchand, like thousands of other Christchurch people, thought the damage to their Tai Tapu home would be covered by insurance.
Twice, in 2009 and 2010, their broker John Jackson told the couple they were insured. They even received a payout for two small claims, one for broken spectacles, before the September quake hit.
But Jackson never arranged the couple's insurance with NZI, a subsidiary of insurer IAG. He even paid for the new glasses out of his own pocket.
Now he is liable for earthquake-related losses incurred by a couple, the High Court in Christchurch has found.
Justice Stephen Kos, in a High Court judgment, has ruled Jackson was liable in regards to losses by the plaintiffs, Nicola and Jacques Marchand, and their solicitor Patrick Costelloe, in relation to the lack of insurance cover.
The loss in this case would be the amount necessary to put them in the same position as if the insurance cover sought by them had been obtained, Justice Kos ruled.
The Marchand couple were not insured on their River Rd, Tai Tapu, property when the September 4, 2010 earthquake hit, with further damage from the February 22 earthquake.
Around June 2009 the Marchands had Jackson arrange insurance cover but he failed to do so. The replacement value of their modern home was not entirely clear but probably exceeded $1.5 million, the judgment said.
The Marchands needed new insurance because Jacques Marchand, a doctor, had been convicted of making false medical claims, and the Marchands' insurer Medical Assurance Society (MAS) had subsequently cancelled their insurances with 14 days' notice.
Jackson did arrange business insurance for Doctors on Cashel Ltd, owned by Marchand and his wife.
From August 2009 the Marchands were under the clear belief they had house and contents cover for River Rd.
After a questionnaire, completed by the Marchands, was submitted by Jackson to NZI, the insurer had emailed back a quote and offer of cover restricted to $1.5m until a valuation was obtained.
However, Jackson did not proceed to arrange cover.
"In truth he did nothing much at all - except to tell the Marchands on a number of occasions that they were covered. Quite why he did so remains a mystery," Justice Kos ruled.
"It seems that the pressures of his business, in combination with some reversals in his health, overwhelmed him."
An insurance broker's general duty could be summed up as to carry out the transaction which he is employed to carry out, or, if it is impossible for him to do so, to inform the principal promptly in order to prevent him from suffering loss.
Answering the question, was Jackson in breach, the judgment said: "There is simply no doubt in this case that Mr Jackson was comprehensively in breach of his duties as broker to the Marchands."
- The Press
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