In a recent case, Dodds v Southern Response, the Court of Appeal upheld the High Court decision that Southern Response provided misleading and deceptive information to the plaintiffs during their earthquake claims and awarded damages to the Dodds. The misleading conduct arose in Southern Response’s usage of the Detailed Repair Analysis (DRA). Southern Response used to have a practice of keeping two versions of the DRA but only providing the policyholders with the version that did not include additional costs such as professional fees, administration costs and a contingency. Therefore, some policyholders (including the Dodds) settled their claims on an amount that was less than their actual entitlement.
Following the decision, Southern Response announced a $300m compensation package to its policyholders who settled their earthquake claims before October 2014. At least 3000 claimants could be eligible. It has been estimated that the average compensation could be in the vicinity of $100,000.
Last year, Mr and Mrs Rossbegan a class action in the High Court representing policyholders who settled their earthquake claims in similar circumstances. The Supreme Court ruled that all policyholders are automatically included in the lawsuit unless they actively opt-out. Because the compensation package affects some of the policyholders in the class action, in February this year, Southern Response sought a direction from the High Court allowing it to contact policyholders directly. However, the Court refused the direction sought. The Ross class action is ongoing. The most recent development happened in April this year, where Justice Osborne reserved his decision after a 3-day interlocutory hearing.
If you settled your earthquake claim with Southern Response before October 2014, we recommend you seek legal advice without delay. Please don’t hesitate to contact our litigation team at Harmans Lawyers for further advice or information.