Is failing to disclose you are a member of an outlaw bikie gang sufficient reason for an insurer to invalidate your insurance policy? That was the question before the Supreme Court of NSW in a case that could have a lasting impact.

A company that owned a brothel which burned to the ground in 2012 has been refused a $770,000 insurance payout because it failed to disclose that its sole director was the sargent-at-arms in the Comancheros motorcycle gang.

In a landmark ruling that will have implications for bikies and organised crime figures, the NSW Supreme Court has ruled that failure to disclose such links invalidates insurance - even insurance taken out over legitimate businesses.

Baris Tukel was the sole director of Stealth Enterprises which owned the Gentleman's Club in Mitchell, a charmless industrial area in the north of Canberra. His brother, Fidel Tukel, well known in boxing circles, was the manager of the brothel.

"What was in issue included whether a reasonable person in Stealth Enterprises' position could be expected to know that their involvement with the Comancheros was relevant to Calliden's decision to accept the risk of insuring the brothel" Justice Monika Schmidt said.

Stealth Enterprises' argued that the court could not accept the insurer's argument: namely that "if you belong to a bikie gang, you can't get any type of insurance". It also argued that given Calliden was prepared to insure brothels, a reasonable person in the community wouldn't realise that membership of a bikie gang was a relevant matter to be disclosed to an insurer such as Calliden. Those arguments were rejected by the court.

Justice Schmidt said she was satisfied that if the brothers had disclosed their bikie connections when they applied for insurance in 2010 or when it was renewed in 2011, they would have been refused insurance.

*** Read the original article here ***

*** Read the decision of the court here ***