Professional Liability Guide

CHAPTER 5 – WHAT IS A PROFESSIONAL/PROFESSIONAL DUTY?

A focus on the nature of the advice or service provided rather than the qualifications of the person providing the advice or service was emphasised in Government Insurance Office of New South Wales v Council of the City of Penrith . 346 The Court held that a letter sent by a town clerk conveying information on behalf of the Council was not sent in a professional capacity.

Justice Powell (Mason P agreeing) observed:

‘The provision of information as to what may, or may not, be ascertained from Council’s records is not, without more, the provision of a professional service; nor is it made so by reason of the fact that the person providing the information may have some form of professional qualification.’ 347 There was no evidence that the advice in question was given by officers of the Council who were acting in a professional capacity. It was possible the advice had merely followed a miscommunication between non-professional officers. This was consistent with the arguments made by QBE and accepted by the Supreme Court of New South Wales in Pioneer Road Services v QBE Insurance Ltd , 348 that the breach of a road work contract was not a breach of a ‘contract for the provision of professional services’ under Pioneer’s policy with QBE. The contract concerned the provision of a traffic control plan by Pioneer to a third party, including the supply and laying of road surfacing in accordance with the design and specifications already determined by the then Road Traffic Authority. There was no element of design in the contract, nor did it call for the provision of advice. As a result, Wood CJ accepted QBE’s submission that the breach in question ‘ did not involve services of a skilful character according to an established discipline ’. 349 Suncorp Metway v Landridge The Victorian Court of Appeal considered whether a real estate agent had breached a professional duty to be entitled to an indemnity in respect of a personal injuries claim in Suncorp Metway Insurance Limited v Landridge Pty Ltd . 350 The claim against the agent was brought by the tenant of a residential property it managed, who suffered injuries when she tripped in a shallow hole in the floor of the property’s garage. Before the incident, the tenant had complained about the hole to the agent’s receptionist, who had failed to pass on or record the complaint. The agent’s property manager responsible for inspecting the property had failed to notice the hole or recognise the injury risk it posed. The question for the Court of Appeal was whether those failures constituted breaches of a ‘professional duty’ within the meaning of the agent’s insurance policy. In its submissions, the insurer emphasised the low level of expertise of the receptionist and the property manager and the simplicity of the tasks they had failed to carry out.

Justice Buchanan acknowledged that if:

‘the word “professional” in the insuring clause is limited to the conduct of a learned profession [referring to the reasoning in FAI v Gold Coast City Council], the cover afforded by the policy will be restricted to probably no more than some incidental aspects of the business of an estate agent. Put another way, unless the agent was to be

346 (1999) 102 LGERA 102. 347 Ibid 105. 348 [2002] NSWSC 137. 349 Ibid [70]. 350 (2005) 12 VR 290.

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