Chubb has avoided paying out on a fire at a luxury home after a court found the owner deliberately sparked the blaze in a bid to pocket $10 million.

“Narcissistic” businessman Preston Richardson was “financially desperate” when the fire gutted Wirraway homestead on the Gold Coast in the early hours of December 28 2016, Queensland Supreme Court judge Tom Sullivan says.

Wirraway was for sale, and had a buyer at $10 million, when it was burnt.

But Mr Richardson had obtained insurance earlier in December 2016 and – in the knowledge the cost of reconstruction was above the coverage – burning the house offered him a better return than the sale minus real estate agent commissions and legal fees, the judge says.

Mr Richardson bought the home through trustee company PBR. After the fire, he claimed on PBR’s policy with Chubb for $10 million.

When Chubb refused the claim, PBR sued. Mr Richardson, who made a fortune as a contractor to the coal seam gas industry, died by suicide in 2018.

National Australia Bank lent $10.88 million on the property and has appointed receivers to PBR.

In dismissing PBR’s case, Judge Sullivan says circumstantial evidence supports Chubb’s allegation that Mr Richardson intentionally lit the fire.

PBR argued that if Chubb could not eliminate innocent causes for the fire, the case was not proven. Motive and opportunity could not be used to produce a verdict of arson, it said.

Judge Sullivan notes experts could not say what caused the fire and Wirraway was so badly damaged it could not be determined if it was burnt deliberately.

However, Mr Richardson had opportunity, being the only person in the house, and motive due to his financial struggles. This and other evidence leads to “a reasonable and definite inference of arson”, the judge says.

The court heard that in 2012-13 Mr Richardson’s company was prosperous, but by 2016 it had lost contracts and hit hard times.

NAB was raising concerns about the business’ viability and had extended its loan to January 2017.

Judge Sullivan says Mr Richardson “was a very tough and charismatic businessman” who was prepared to engage in misleading and deceptive conduct. He also had a drug habit.

He notes Mr Richardson gave different versions of what he experienced and saw at the time of the fire, but consistently denied setting the blaze. 

Read the judgment here.