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  • Vero Liability - Policy
    Other Links Market Bulletins Glossary Home Products Specialty products Seedsman Policy Seedsman Policy This Claims Made policy provides protection for claims by third parties for financial loss following the alleged failure of seed sold or supplied to germinate as specified errors in germination tests mislabelling or mixing of seed varieties Typically the coverage will provide Payment for the costs of defence of any allegation The costs of any settlements for

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Products_Seedsmens_Policy (2016-04-26)
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  • Vero Liability - Claims Examples - Associations Liability
    manner The suspension was contested vigorously through the NZ Sports Tribunal process The substance of the original disqualification was conceded by the aggrieved rider but mitigating circumstances were cited The association was equally adamant that it had acted correctly but the tribunal found that the initial suspension was dealt with in a manner which lacked fairness and natural justice The insured s claim was dealt with as a Professional Indemnity matter During the proceedings over nearly two years involving four appearances at the tribunal there were significant legal costs incurred by both sides An expensive exercise in due process Inappropriate Advice The Insured is an industry association One of its member firms was involved in a personal grievance arising from the redundancy of an employee The firm lodged a claim against the association alleging that an association employee had provided information and guidance to the redundant employee contrary to the interests of the member firm The allegations were substantiated and the claim was settled by VL for 12 000 under the Professional Indemnity section of the policy The association employee was subsequently dismissed Mis Reporting The insured an industry training organisation was called to account by the Tertiary Education Commission after the TEC received an anonymous complaint alleging that the insured had misreported on the findings of a staff survey which sought views that might allow it to enhance its services and organisational strategies The complaint specifically suggested that in the published survey findings the insured had omitted reports of serious misconduct breach of policy and fraudulent reporting of trainee achievement outcomes VL responded by treating the issue as a claim under the Official Investigations extension of the Association s Liability policy and commissioned a lawyer to assist the insured in its response to the TEC The lawyer found that

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_AssociationsLiability (2016-04-26)
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  • Vero Liability - Claims Examples - Bailees Liability
    had been unaddressed and it was left to the insured to take instructions from the owner as to consignment then it would probably have been a bailees liability On Shaky Grounds The insured in the Bay of Plenty region provides contract packing and storage of pumpkins It also manufactures the wooden crates in which the product is packed and stored for export During a routine night patrol of the insured s warehouse the security guard noticed that the stacks of loaded pumpkin crates had collapsed in a domino effect and there was major spillage and consequent damage to about 50 of the product Claims were made on the insured by the three owners of the pumpkins who had lost export orders as a result of the damage Because there was a glut of product in the market at the time there was effectively no worthwhile salvage value in the damaged product Inquiries into the cause indicated that the stacks may have collapsed following seismic activity in the area and liability was initially denied However in further investigations it was discovered that the configuration of stacking the crates was not up to best practice the rows of stacked crates were free standing and unstable one of the crates had badly knotted timber in its makeup It was reasonably surmised that the weakened crate collapsed in itself and started the domino effect So notwithstanding that a small earth tremor may have triggered the collapse the insured was negligent in its crate manufacture and stacking methods On the weight of probabilities liability was admitted indemnity confirmed and the claim was settled for 86 000 Resin vs Resin The insured is a general carrier and warehousing operation with a specialist division for bulk liquids cartage and storage It stores various liquid products in a

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_BaileesLiability (2016-04-26)
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  • Vero Liability - Claims Examples - Consequential Loss
    insurance responded Another outcome was that the developer s main contractor had to change his work methods which precluded the use of horizontal drilling The sub contract provided no compensation for such an eventuality The insured had not been seeking alternative work in anticipation of work on the development re commencing any day The VL Liability Consequential Loss policy would have responded to compensate for the financial loss Increased Costs The Insured a manufacturer of electronic controller panels A supplied a faulty batch of product to an appliance manufacturer B The controller panels began failing after only two or three months and B was faced with significant costs in satisfying warranty claims A s VL Products Liability cover indemnified A for B s financial loss Whilst it was investigating the cause of the fault A had to import alternative supplies of controllers at greater cost to maintain sales whilst the problem was identified and rectified The additional costs would have been indemnified by a VL Liability Consequential Loss policy Loss Of Contract The insured an engineering servicing company had a 3 year maintenance contract with a major manufacturer to service a specialist plastic moulding machine The insured s serviceman dropped a tool into the hopper of a plastic moulder damaging the injector screw and rendering the machine unusable The Insured s VL Public Liability insurance took care of the manufacturer s losses but the maintenance contract was suspended until the machine was back in operation which took several months The unhappy contractor lost 60 of his revenue for the period the machine was inoperable The VL Liability Consequential Loss policy would have responded to compensate for the financial loss Under Age Drinking The Insured a supermarket operator was prosecuted and convicted for selling liquor to underage customers and for allowing

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_ConsequentialLoss (2016-04-26)
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  • Vero Liability - Claims Examples - Crime
    proportion of the used bins and trays which it believed it was selling to a recycling company The insured s employee who managed the recycling successfully purported to the recycler that he in fact was an independent go between and that the recycled plastic had been purchased by him from the insured He was thereby siphoning off the value of the product into his own account and electronically crediting the insured s account for enough of the money to satisfy expectations The scam was operating for about three years and was discovered when the management of the recycling firm changed The new owners decided that they could probably benefit by cutting out the middle man and approached the insured with a view to gaining better terms by buying direct The loss was initially estimated to be 45 000 but the insured had no means of verifying quantum with the demise of the former recycling firm Settlement was agreed at 25 000 which was reduced by a significant policy excess At the time of preparing this commentary the police prosecution was pending Rentals The insured is a property management company in the lower end of the residential market It looks after hundreds of properties The dishonest employee one of its property managers had the task of doing the rounds weekly or fortnightly and collecting rents in cash from about 110 tenants Receipts for the money collected were made by entry into a tenant s rent book The monies were then recorded by the property manager herself directly into the insured s computerised banking system and she produced a bulk itemised receipt for the funds from the computer system In the course of normal business there were always tenants who failed to pay for one or two weeks but without getting into serious arrears The employee committed the theft by pocketing one or two weekly rentals and recording no pay against various tenants She maintained a rolling system where the shortfall in the money never appeared conspicuously against the same tenants and the level of no pays was always within acceptable levels The scam was uncovered when the employee had to go to Australia for a family bereavement A very particular tenant missing her collection called in to the office to pay her rent It turned out she was on the office records as two weeks overdue although her rent book showed her as up to date A full audit was conducted and it was reliably established that 37 000 had been stolen over a period of 11 months When confronted the employee owned up and immediately paid back 11 000 VL settled A police prosecution followed and she was convicted with restitution ordered at 300 per month The file remains open The insured has tightened up its systems Third Party Property The insured is a warehousing and logistics company A One of its metropolitan operations is housed in a large warehouse in a semi cloistered industrial park It warehouses a variety

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_Crime (2016-04-26)
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  • Vero Liability - Claims Examples - Defamation
    the Defamation provision of a Professional Indemnity policy The insured was one of a group of three companies which allegedly conspired to make false and misleading statements about one of their competitors for the purpose of luring away its customers and inducing them to breach contracts The aggrieved firm filed a suit for 1 1m damages for loss of business and damage to reputation The defence was that allegedly defamatory statements were not directed specifically at the claimant and were general views of market conditions The suit was resolved by mediation with a payment of 325 000 to the plaintiff The VL insured played a relatively passive role in the matter and contributed 75 000 to the settlement There was protracted legal process involved both from the mediation and the eventual apportionment and VL s defence costs were 38 500 Newspaper reportage The insured is a provincial newspaper It was reporting on forthcoming elections to a regional development trust The point at issue was a perceived or alleged improper influence by a trust officer to secure an appointed trusteeship for a specific person The trust officer issued proceedings against the newspaper s publishers alleging that it had misreported the affair

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_Defamation (2016-04-26)
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  • Vero Liability - Claims Examples - Director's & Officer's
    directors responsible for their dismissal The D O insurer was notified and solicitors appointed to defend the allegations against the individual directors An allocation of costs was agreed for the defence of the company not itself insured under a D O policy and the defence costs for the insured directors The directors successfully defended the claims at the employment tribunal hearing Claims from third parties In certain circumstances it is possible for commercial partners creditors or members of the public to bring a claim against an individual director rather than the company A management consultancy contracted to provide services to a food company It was later alleged that a director of the consultancy had breached the confidentiality provisions of the contract by disclosing commercially sensitive information to a competitor The food company terminated the contract for consultancy services and issued proceedings against the management consultant The claim alleged not only breach of contract but also a wrongful act on the part of the director allegedly causing lost sales to the food company The individual director denied that he had done anything wrong and notified the D O insurer Insurance cover was provided on the basis that an allegation of a wrongful act had been made against an insured person company director The allegation of misconduct was not admitted nor was it ultimately proven The insurer arranged for solicitors to act in the defence of the claim The director successfully defended the claim but the cost of defence was significant Company A contracted with Company B for the supply of raw materials for processing Company A began to experience financial difficulties and the time for payment for the materials began to slip At a meeting between Company B and the director of Company A the director made various representations to Company B regarding the financial position of Company A its ability to meet its obligations and that there was no problem On the basis of the representations Company B continued to supply Company A with product In fact Company A was in a perilous state and the representations made by the director were fanciful Company A shortly thereafter became insolvent leaving large amounts owing to Company B Company B issued proceedings against the director of Company A alleging breach of the Fair Trading Act 1986 The D O policy responded to the claim The director was found liable for breach of the Fair Trading Act there being no reasonable basis to support the statements that the director had made in circumstances where he had taken personal responsibility for the provision of information to Company B A director of a yachting broker entered a buyback contract with a customer which the company could not honour because it did not have the money After the company was voluntarily liquidated the customer brought a claim against the director of the yachting broker and alleging that at the time the yachting broker entered the contract it was insolvent The policy responded to assist the director

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_DirectorsOfficers (2016-04-26)
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  • Vero Liability - Claims Examples - Employers Liability
    and surrounding infrastructure OSH investigated immediately The VL lawyer assisted the insured in dealing with OSH s initial enquiries and interviews In a very highly charged investigation involving numerous parties it emerged that the installation owner over the period of the works had allowed parts of the plant back into use so that the area surrounding the job was no longer hazard free This had never been communicated to the insured The many possible direct causes had to be examined from circumstantial evidence as the explosion had obliterated physical evidence but it eventually emerged that the insured was not implicated The insured was not prosecuted but VL incurred 14 600 costs in ensuring this outcome Faulty Equipment The insured was a civil engineering contractor engaged to replace a tide gate on a bridge Using a crane with a special lifting rig the new gate was being lowered into position when the lifting gear failed and the falling steel gate scissored an employee s arms against the bridge parapet An OSH prosecution resulted and after investigations the VL lawyer established that there was a defect in the lifting rig which the insured could never have suspected The charges against the insured were dropped and the prosecution was re directed to other contractors Legal and experts costs totalled 7 400 Section 49 Section 50 The insured is a large commercial bakery Its employee caught his arm in a pastry rolling machine causing fractures and bruising The insured was prosecuted under both Section 49 and Section 50 of the legislation Section 49 exposing the worker to a known hazard has the more serious penalties Section 50 failing to ensure the workers safety the more common basis for prosecution Due to the potentially serious outcome for the insured under Section 49 VL engaged a

    Original URL path: http://www.legaledge.co.nz/dirvz/liability/liability.nsf/Content/Claims+Examples_EmployersLiability (2016-04-26)
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