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Determination
Case number | 12-00-1070996 |
Financial firm | Insurance Manufacturers of Australia Pty Ltd |
Case number: 12-00-1070996 18 July 2024
1.1 Complaint
The complainant arranged a motor vehicle insurance policy with the financial firm (insurer) on 3 January 2023 for a vehicle he was purchasing from a private seller in Queensland.
The complainant says he booked a car transport service to bring the vehicle to Victoria. When he contacted the transport service around 4pm on 3 January 2023, he says was told the vehicle had not been delivered for transport.
The complainant lodged a claim for the loss of the vehicle. He says it was stolen and wants the insurer to reimburse him for the cost of the vehicle.
The insurer declined the claim. It says the loss is not due to an insured event.
No. The complainant has not shown, on balance, he suffered a loss due to an incident covered by the policy.
The outcome is fair because the insurer’s obligations are limited by the terms of the policy. In this instance, it would not be fair to require the insurer to cover the claimed loss. This is because the loss falls outside the scope of cover.
1.2 Determination
This determination is in favour of the insurer.
The insurer is not required to take any further action in relation to the claim of complaint.
2.1 Has the complainant established a claimable loss?
No. The complainant has not shown, on balance, he suffered a loss due to an incident covered by the policy.
When making a claim the complainant has the initial onus to show a loss of a type covered by the policy. The complainant must show this on the balance of probabilities (that is, it is more likely than not).
Once the complainant has shown a loss covered under the policy, the onus transfers to the insurer to show it can rely on a condition, limitation, or exclusion in the policy to limit its liability or to deny the claim.
The policy provides cover for loss or damage caused by specified incidents. The full terms and conditions of cover are set out in the product disclosure statement (PDS) and certificate of insurance. Relevant policy terms are included in section 3.2 of this determination.
The insurer says the complainant provided the following description of the loss when lodging the claim online:
I…purchased a 2015 Lexus rx350 f sport from [seller] from [address] after receiving 100 points of ID and a contract of sales. The arrangement was made that the seller will deliver the car at 9am on Tuesday to the depot [transport service] which was already paid for so it can be delivered to me in VIC. The car was never received by the depot. The vehicle was under finance and I was asked to pay it so he can cancel the registration and transferring it into my name. After he was paid, the registration was cancelled, however I have never received the car. I have contacted lexus of brisbane and the car is in fact in his name and all services were done there. The police report of the exact details will be provided as well as information on the seller and his bank acc details.
The complainant says the vehicle was stolen.
The insurer says there is no persuasive information to show the vehicle was stolen from the complainant. It says the loss is not due to an event covered by the policy.
The policy provides cover for theft. Theft is not defined in the policy. In these circumstances, AFCA takes the approach that the ordinary mean of the word applies.
The Macquarie Dictionary defines ‘theft’ as:
the act of stealing; the wrongful taking and carrying away of the personal goods of another; larceny
It defines ‘steal’ to include:
1. to take or take away dishonestly or wrongfully, especially secretly.
And ‘larceny’ as:
Law the offence of taking away, without the consent of the owner, anything capable of being stolen, with the intention of permanently depriving the owner of it; theft.
These definitions indicate theft involves taking property from its owner.
The meaning of theft in an insurance context has also been judicially considered. In Lockwood & Lockwood v Insurance Australia Ltd [2010] SASC 140, Kourakis J agreed theft should be given its ordinary meaning, and said:
In my view, the indemnity for theft extends to any dishonest taking of the insured vehicle which materially interferes with the owner’s proprietary interest in it. A person steals a vehicle for the purpose of the policy if he or she takes the vehicle without the owner’s permission in circumstances where he or she knows the owner would not consent and knowing that the degree of their interference is material and wrong.
This interpretation also refers to ownership and taking of the vehicle.
Consistent with this interpretation, the complainant’s responsibilities under the policy include substantiating his claim by providing proof of ownership of the vehicle.
The complainant provided a copy of an undated and unsigned contract of sale with the seller. It said the complainant would pay the seller $26,000, including a $1,000 deposit plus $6,500 for the finance owing before inspecting the vehicle (as part of the deposit), then an additional $18,500 after inspection. The contract said the total deposit paid was refundable and subject to inspection by the complainant on or around 30 December 2022.
The complainant provided screenshots showing a series of online payments to the seller totalling $25,500, being:
The complainant says this information shows he was the owner of the vehicle as payments were made to the seller for the vehicle. p
I am not satisfied the contract and payment records provided are sufficient to show the complainant owned the vehicle. This is because there is no information showing the conditions of sale and transfer of ownership were completed. No information was provided to show the final $500 was paid by the complainant or that he inspected the vehicle as agreed to make the sale unconditional. Further, there are no records confirming transfer of ownership to the complainant.
The complainant says the vehicle was not delivered to the transport service by the seller as agreed. No record of this agreement with the seller has been provided, or any information from the transport service confirming the vehicle was booked for transport but not delivered.
The complainant provided a police report dated 4 January 2023. The report refers to obtaining property by deception. It does not refer to the vehicle or include any description of the circumstances of the loss.
The insurer says obtaining property by deception is not theft, and the report does not show the police are treating the loss as a theft. The complainant says the report is incorrect as it was issued 24 hours after the loss was reported to police and before any investigation was undertaken. The complainant acknowledges no update has been provided by the police.
The insurer also refers to a Personal Property Securities Register (PPSR) search for the vehicle dated 28 December 2022, which indicated the vehicle had not been reported as stolen at that time. I note the PPSR search was conducted before the complainant made any payments to the seller. No current PPSR search record has been provided to AFCA. Even if it was, the PPSR search record states a stolen vehicle notification, or the absence of one, does not necessarily mean a vehicle is or is not stolen. Accordingly, I am not persuaded the PPSR record assists either party.
Considering the limited information provided, I am not persuaded the complainant has shown the vehicle was stolen from him. This is because there is no information showing he ever took possession or ownership of the vehicle or that the terms of sale were completed. As the complainant has not shown, on balance, he owned the vehicle or that it was taken from him I am not persuaded the loss was a theft covered by the policy.
On balance, I consider this was an incomplete personal transaction between two parties. I acknowledge the complainant may have been the victim of a crime, however I am not satisfied he has shown the event:
As I am not satisfied a claim within the terms of cover has been shown, the insurer is entitled to decline the claim in these circumstances.
2.2 Why is the outcome fair?
The outcome is fair because the insurer’s obligations are limited by the terms of the policy. In this instance, it would not be fair to require the insurer to cover the claimed loss. This is because the loss falls outside the scope of cover.
3.1 The AFCA process
AFCA has determined this complaint based on what is fair in all the circumstances, having regard to:
The respective parties have completed a full exchange of the relevant information, and each party has had the opportunity to address any issues raised. We have reviewed and considered all the information the parties have provided.
While the parties have raised several issues in their submissions, we have restricted this determination to the issues that are relevant to the outcome.
AFCA is not a court of law. We do not have the power to take or test evidence on oath, or to require third parties to give evidence.
When we assess complaints, we consider:
We give more weight to documents created at the time the events occurred. If there are no relevant documents, we will decide what most likely occurred based on the available information.
If there are conflicting recollections and these are evenly weighted, we may find that a claim cannot be established.
3.2 Relevant policy terms
Cover for loss or damage
We will cover loss or damage to your vehicle caused by any of the following incidents:
Your responsibilities when making a claim under this Policy
Your responsibilities when you make a claim are described below...
If you do not meet your responsibilities, we may refuse to pay your claim or reduce what we pay for your claim. We may also decide to cancel your policy. The course of action we take when you fail to meet your responsibilities will be considered in each circumstance based on what impact or effect your failure caused or contributed to the claim or our decision to issue your Policy.
you must:
…
where requested by us, substantiate your claim by providing proof of ownership for your vehicle, or any personal items, modifications, options or accessories. This may include providing receipts, valuations, model and serial numbers
