Subrogation: effect of partial indemnification of the assured

In Johnston v Endeavour Energy [2015] NSWSC 1117 the New South Wales Supreme Court discussed in detail the question whether an insurer has subrogation rights where a part of the assured’s loss is not covered by the policy. The court’s conclusion was that the assured retained the right to control the litigation against the third party in that situation, and that no subrogation rights attached. The point arose in the context of representative actions permitted under the law of New South Wales.

Endeavour Energy : the facts