RGA Reinsurance Company of Australia Ltd v Westpac Life Insurance Services Ltd (No 2)

I gave judgment in this matter on 23 September 2020. [1] These reasons assume familiarity with that judgment. I will use the same abbreviations.

I concluded that RGA’s summons should be dismissed with costs. [2]

No orders have yet been made.

RGA sought to make submissions as to whether I should make the costs order foreshadowed in the judgment.

The parties have now exchanged submissions on that question.

There is no dispute that RGA’s summons must be dismissed.

On the face of things, costs should follow the event. [3] Westpac Life having succeeded, the ordinary position is that it should have its costs. It is for RGA to show that “some other order should be made as to the whole or any part of the costs”. [4]

RGA seeks its costs to 11 September 2020 because:

In those circumstances, RGA submits that Westpac Life should pay its costs up to 11 September 2020, and accepts that it should pay Westpac Life’s costs thereafter.

A fundamental element in this chain of reasoning is the proposition that it was at all times until 11 September 2020 reasonable for RGA to request documents under the relevant provision in the Treaty.

I am not able to reach that conclusion for a number of reasons.

First, the range of documents sought by RGA was, at the outset, very much wider than at the hearing before me and changed in ambit from time to time in the weeks leading up to the hearing.

Second, a factor in the delay by Westpac Life in producing documents, including the two transaction documents, was the need to establish a confidentiality regime in relation to the Trustees’ documents in circumstances where I have accepted that Westpac Life owed a duty of confidentiality to the Trustees. [7]

The purpose of the proceedings was to investigate whether Westpac Life had sold or transferred the Policies contrary to the terms of the Treaty in circumstances where, in my opinion, nothing in the documents then available to RGA and to which my attention has been drawn, suggested that there has been a sale or transfer of the Policies.

In these circumstances, I am not able to conclude that it was reasonable of RGA to commence and prosecute the proceedings to 11 September 2020 such that it should have its costs to that date.

RGA also pointed to the fact that, at the hearing, Westpac Life did not press its motion of 28 August 2020 seeking, on the basis of the dispute resolution clauses in the Treaty, a stay of proceedings.

I accept that RGA has incurred costs in relation to that application which have been thrown away by Westpac Life’s unexplained failure to prosecute that motion.

Because Westpac Life did not press the motion, no time at the hearing was taken up with it. However, a significant part of the written submissions of both parties was addressed to this question. It is also true that the merits of that motion were not determined, but that is because Westpac Life in effect abandoned it.

I make the following orders: