PI insurance may cover Westpoint losses
Investors in failed Westpoint developments may recover their losses from professional indemnity insurance after the NSW Supreme Court of Appeal rejected a challenge from QBE Australia.
Legal firm Slater & Gordon launched a class action against Quantum Securities in March 2007 after authorised representative Andy Chen advised 59 clients to invest almost $6.9 million into two developments in Melbourne and Sydney.
In December 2005 both developments went into liquidation. QBE claimed the financial planning firm’s PI insurance could not cover allegedly inappropriate advice given by Mr Chen.
But the NSW Court of Appeal disagreed, ruling investors could invoke the insurance if the ongoing class action is successful.
Slater & Gordon associate Ben Whitwell welcomed the decision as a “major win for mum and dad investors,” most of whom are from the Chinese community.
QBE declined to comment.
Legal firm Slater & Gordon launched a class action against Quantum Securities in March 2007 after authorised representative Andy Chen advised 59 clients to invest almost $6.9 million into two developments in Melbourne and Sydney.
In December 2005 both developments went into liquidation. QBE claimed the financial planning firm’s PI insurance could not cover allegedly inappropriate advice given by Mr Chen.
But the NSW Court of Appeal disagreed, ruling investors could invoke the insurance if the ongoing class action is successful.
Slater & Gordon associate Ben Whitwell welcomed the decision as a “major win for mum and dad investors,” most of whom are from the Chinese community.
QBE declined to comment.