Anglo Starlite Insurance Co Ltd v. Wong Ping Fai
Read the full judgment text of CACV 162/1983 on BabelCite. This Court of Appeal judgment.
1. We dismissed this appeal at the conclusion of the hearing saying that we would hand down our reasons later. This we now do.
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HEADNOTE A condition of an insurance policy provided that "Every letter claim writ summons and/or process shall be forwarded to the Company immediately on receipt by the Insured". Hold It was a sufficient compliance with the condition that a copy of the relevant document was forwarded to the company by a third party. Date of hearing : 31st January, 1984 Date of handing down of judgment : 14th February, 1984
BETWEEN
----------- Coram: Hon. Leonard, V-P, Cons & Fuad, JJA Date of Judgment: 14th February, 1984 __________ JUDGMENT __________ Cons, J.A. : 1. We dismissed this appeal at the conclusion of the hearing saying that we would hand down our reasons later. This we now do. 2. On the 26th September 1980 the plaintiff in the Court below was driving a car along Jordon Road, Kowloon when he was involved in a collision which caused to damage to another vehicle. It was not his own car that the plaintiff was then driving but he was covered for insurance purposes by a policy which the owner had taken out with the defendant company and which extended the benefit of the policy to any person who was driving with his permission. The extension was subject to fulfilment of the conditions of the policy. 3. There are nine paragraphs of conditions annexed to the policy. We are concerned with only paragraph 1. This contains four individual conditions but we need set out only two. The first is "Notice shall be given in writing to the Company immediately upon the occurrence of any accident or loss or damage and in the event of any claim." The second is "Every letter claim writ summons and/or process shall be forwarded to the Company immediately on receipt by the Insured." These are conditions precedent to the liability of the company. 4. Three days after the accident the plaintiff did report in writing to the company. Nothing then happened for some eighteen months until the owner of the other vehicle issued a writ in the Kowloon District Court claiming damages against the plaintiff and the owner of the car that he had been driving. Neither he nor the plaintiff sent a copy of that writ to the company. However the solicitors for the owner of the other vehicle had taken the precaution of sending a copy of the writ direct to the company, so the company did in fact know all about the action. Even so they did nothing. Nor did the plaintiff. In due course judgment in default was entered against him for an amount just short of $12,000. In his turn he started an action against the company who, in their turn, relied on breach of condition of the policy :-
5. The Judge below found in favour of the plaintiff. It is not easy to be confident of the exact grounds on which he based his decision. As we read the judgment it seems that he found there to have been a breach of the first condition, in that the owner had not, in addition to the plaintiff, made an initial report of the accident in writing. No such point had been taken by the company and we doubt whether it would have been open to them on the pleadings as they stood. 6. Be that as it may, having found such a breach the judge was nevertheless satisfied that it had been waived by the inactivity of the company after it received the plaintiff's report of the accident. We have some difficulty in following his reasoning in this respect. Suffice it to say that the plaintiff's counsel does not seek in this Court to uphold that part of the decision. 7. The crucial, and indeed the only question in the case is the true construction of the second condition, i.e. : "Every letter claim writ summons and/or process shall be forwarded to the Company immediately on receipt by the Insured." Does this condition required the insured - or where appropriate, as in this particular instance, a person driving with his permission - personally to forward every letter claim etc. or is it sufficient that a copy of the document is forwarded by a third party? 8. The majority decision in Barrett Bros. (Taxis) Ltd. v. Davies (Lickiss case)(1) suggests that where it is a question of information then it is sufficient compliance with the condition that the company receive the information from another source. However that conclusion has not passed without criticism, at least, by implication : see Farrell v. Federated Employees Insurance Association Ltd. (2) And in The Oriental Fire & General Insurance Co. Ltd. v. Cheuk Ma-yee(3) McMullin V-P appears to accept the dissenting view of Salmon LJ that an absolute obligation was imposed upon the insured himself. Every condition must of course be construed in accordance with the actual words used and the words used in Lickiss case were by no means the same as those used in the present. But insofar as the approach adopted in one case may assist in another we would, with the greatest respect to the majority there, also incline to the approach adopted by Salmon LJ. 9. In The Vainqueur Jose (4) Mocatta J. was called upon to-construe a similar condition in the rules of the P. and I. club :-
10. He came to the conclusion that in the circumstances notice had to be given by the Member or by his duly authorised agent. He rejected a submission that the relevant notice could be given by a third party, or in particular by anyone who had an interest to do so. But it must be noticed that the learned judge was dealing with a requirement that approximates to our first condition rather than to our second condition, and that he was particularly influenced by the "very considerable burden and expense" that the necessary immediate investigations would put-upon-the managers of the club if they were required to treat every incident or accident involving a member of which they might incidently come to have knowledge as a potential claim against the club, investigations that would not be necessary if, as was proved before him to be quite often the case, the member ultimately settled the claim without reference to the club. 11. This would of course not have been a relevant consideration if incidents or accidents usually did lead to claims, as the Judge thought would happen with road traffic accidents. It was on this ground that he distinguished Lickiss case : see page 566. We would respectfully agree with that view, particularly where the other party to the accident has gone so far as initiating proceedings in Court. 12. The words which we have to interpret do not inevitably lead to the construction put upon them by the company. The words "by the insured" could relate equally as well to "immediately on receipt" as they might to "shall be forwarded to the company". Indeed from a gramatical approach they would seem to apply more accurately to the former. 13. We have found it difficult to envisage what advantage the company would derive from a personal forwarding by the insured. It seems to us that, if as is admitted, it is sufficient for the insured to send a copy of the document with nothing more than a formal covering note, then the company loses nothing when the only difference is in the signature appended to that note. 14. Mr. Pirie, who has striven hard for the company, has drawn our attention to difficulties which the company would face as to the filing of a suitable defence if e.g. an action were started against the insured by way of substituted service and the copy of the writ served directly upon the company as well. 15. We appreciate these difficulties, but they seem to us to flow not from the fact that the writ was forwarded by a third party, but from the inability of the company to contact the insured thereafter. The position would be the same if the insured, having himself passed on the writ to the company, should move away leaving no forwarding address. 16. Mr. Pirie has also asked us to consider paragraph 1 of the Conditions as a whole, the general tenor thereof being, in his submission, that the notification must come from the insured himself. In this respect it is pertinent to note that although, as we mentioned earlier, paragraph 1 contains altogether four conditions, the form of the wording used is not the same throughout. A third condition which relates to notice "of any impending prosecution inquest or fatal inquiry" is phrased like the first two, i.e. "notice shall be given". The fourth however requires that "the insured shall give immediate notice" to the police "and co-operate with the Company in securing the conviction of the offender'" whenever theft or other criminal act may result in a claim. The introduction to the Conditions shows that care has been taken in the choice of the particular language. We do not think that the variation is necessarily without significance. 17. It is no part of the duty of this Court to criticise the company for taking what some might consider an unmeritorious or technical point. Nevertheless the clause is apt to exclude the company from a liability which would otherwise attach to it under the contract. As such, in order to be effective it must be most clearly and unambiguously expressed. In our view it does not reach that standard. The language used might perhaps be described as neutral. We find no clear and unambiguous requirement that it shall be the insured who personally forwards the documents in question. 18. It was for this reason that we dismissed the appeal. Now, in reliance upon Order 42 rule 5A, we make an order nisi that the appellant do pay the respondent his costs.
(1) [1966] 1 WLR 1334 (2) [1970] 3 All E.R. 632 at 638 (3) [1981] 1 HKLR 41 at 52 (4) [1979] 1 LL LR 557 Representation: Mr. Nicholas Pirie (Messrs. Johnson, Stokes & Master)for the Appellant Mr. Kumar Ramanathan (Messrs. Robert W.H. Wang & Co.) for the Respondent |
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