In March 2023 the Australian Federal Court found that a claim had first been made against a director when an email was sent to his address but allegedly not read by him till much later. A “claim” made against the director under the claims occurring policy was the “written notice received by a director for a demand for compensation” for a wrongful act covered by the policy.
The email address used for the claim was an operational email account. There was no malfunction of the account. Nor was there any email bounce-back or delivery failure notification. The definition of the word “claim” said nothing about the insured having read, let alone read and absorbed the consents of, the written communication. The natural and ordinary meaning of the word “received” in the context did not require more than that a written notice had been provided to the director in the sense of being put into their possession. There was no basis to read in a requirement that the written notice had to be ‘knowingly received’ or ‘received to the knowledge of the director’.
Therefore, the claim was a claim first made during the period of insurance and properly made in terms of the policy. The insured succeeded in its contention that a claim had been made under the claims occurring policy within the period of insurance but it failed because of the application of an exclusion.
A similar outcome can be expected on that wording in South Africa. It would usually not be possible, unless the email is acknowledged by a person, for the sender to prove that any notice sent and received had been knowingly received.
Hakea Holdings v Neon Underwriting Limited [2023] FCAFC 34
