Shukram v New India Assurance Company Ltd

• Jurisdiction: Guyana
• Judge: Vieira, J.,Scott, L.J.
• Judgment Date: 29 November 1969
• Neutral Citation: GY 1969 HC 28
• Court: High Court (Guyana)
• Date: 29 November 1969

High Court

Vieira, C.J.;

Shukram

and

New India Assurance Co. Ltd.

Appearances:

R.P. Rawana for the plaintiff.

C A. F. Hughes for the defendant.

Insurance - Motor vehicle — Third Party insurance — Transfer of policy on sale of vehicle — Agent acting for assurance company Arbitration — Arbitration clause in policy — Defendant denying existence of policy — Whether plaintiff precluded from recourse to courts — Motor Vehicles 4nsurance (Third Party Risks) Ordinance Cap. 281.

In January 1960, one J bought a car but it was not registered in his name until July 1, 1960 on which day too he took out a policy of insurance with the defendants in respect of third party risks. On July 5th 1960, J sold the car to the plaintiff to whom the registration was transferred the same day. On July 7, 1960 J and the plaintiff attended at the office of M, the defendant's agent in New Amsterdam, seeking to have the insurance policy on the car transferred from J to the plaintiff. Forms were filled up by the parties. These together with J's certificate of insurance and the receipt for the one premium he had paid, were retained by M who, after ascertaining that the plaintiff's son would be the driver of the car, said that the car could be used and that he would send the insurance policy later. It was never sent. On October 22, 1960 the plaintiff's son was involved in an accident while driving the car and later pleaded guilty to careless driving. The accident was reported to M on October 23. In 1963 the person injured in the accident sued the plaintiff for damages for injuries received by her. The plaintiff left the writ with M and later the defendants wrote the plaintiff saying that they repudiated all liability under the policy under which the car was insured on the ground of non-compliance with certain conditions. Damages were awarded against the plaintiff in the action by the injured woman and were paid in full by him. In the present action the plaintiff seeks to recover from the defendants the sums so paid. It was argued on behalf of the defendants that (i) there was no assignment of the policy from J to the plaintiff, that in any event there should be a new contract between the plaintiff and the defendants and (ii) the plaintiff should not have brought an action but should have gone to arbitration in accordance with clause 9 of the defendants' policy of insurance.

• HELD: — that (i) there was a valid transfer of the policy by the defendants to the plaintiff because (a) their agent M had led the plaintiff into the reasonable belief that he had authority to accept and approve of the transfer. (b) the defendants by their letter to the plaintiff had recognised him as a policy holder and had repudiated liability only on the ground that he had committed breaches of the policy.

• (ii) since the defence of the defendants was that there was no contract between them and the plaintiff they cannot both approbate and reprobate and insist on the observance of an arbitration clause embodied in that contract.

Vieira, J.

1 The only evidence adduced in this matter is that of the plaintiff and his witness Walter Jagdeo. No evidence was led on behalf of the defendants who closed their case at the end of the case for the plaintiff.

2 Having regard to the oral and documentary evidence adduced, I accept and believe, on the balance of probabilities, the story as related by the plaintiff and Jagdeo.

3 I consider that what really happened was as follows:-

• (1) In January 1960 Walter Jagdeo, a spirit shop-proprietor of Adelphi, Canje, Berbice, purchased a second-hand Morris Minor car P7300 from one Allen of Rose Hall Estate, Canje, for an undisclosed amount. This car, which was registered in the name of one Carlton James, was not used for 6 months and it was not until 1st July, 1960 that the registration was changed to Jagdeo's name on which date, he took out a policy of Insurance with the defendants (hereinafter called the company) in respect of third-party risks.

• (2) Just 4 days later, i.e. 5th July, 1960, Jagdeo sold the car to the plaintiff for $450.00 and he received $250.00 on account that very day leaving a balance of $200.00. The registration was then changed to the plaintiff's name at Central Police Station, New Amsterdam and a certificate of registration (Ex. “A”) issued therefor.

  The two men, accompanied by the plaintiff's 30 year old son Gobin, then went to the Strand office of one George Moonsammy, the company's representative in Berbice but he was not in. They returned on 7th July 1960 and this time they were fortunate enough to find Moonsammy in office.

  Jagdeo told Moonsammy (hereinafter called the agent) that he had sold P7300 to the plaintiff and he wanted the insurance policy transferred to the plaintiff's name. As the plaintiff could not read or write but merely sign his name, his son, Gobin, then filled up two forms which his father and Jagdeo signed. These forms were retained by the agent.

  Jagdeo had not received any insurance policy up to that time but he had a certificate of insurance as well as a receipt for the one and only premium paid by him. He then handed over these two documents to the agent who was heard to remark that “everything would be in order.”

  The agent then asked the plaintiff who would be driving P7300 and the plaintiff replied that his son Gobin would be the driver. The agent then said that would be all right and that the car could be used and he would send the insurance policy later. The parties then left the office.

• (3) Gobin began to drive the car from 7th July, 1960. He was employed at, the Rose Hall Estate and was a licensed driver of 3–4 years experience at the time.

• (4) On 22nd October, 1960, P7300 driven by Gobin was involved in an accident with a pedestrian by the name of Chanderdai Adam on Port Mourant public road, Corentyne.

• (5) Some time between 7th October and 22nd October, 1960 the plaintiff paid the agent the sum of $30.00 after the agent intimated that he wanted that sum to get the policy.

• (6) On the 23rd October, 1960, the plaintiff, accompanied by Jagdeo and his son Gobin, went to the agent and made a report about the accident. Some forms were filled out by Gobin who drew a diagram of the accident.

  Jagdeo then asked the agent where was the insurance policy and he replied that it had not come from Georgetown as yet. The agent then said that the plaintiff would have to pay some money as this has to be done whenever a car is first involved in an accident and he mentioned the sum of $100.00, The plaintiff said that he had not got the money with him and asked the agent to reduce the amount but the agent said that was the usual amount. The plaintiff then promised to bring the $100.00 the next day which, in fact, he did not do.

• (7) Later, Gobin appeared at Whim Magistrate's Court where he pleaded guilty to a charge of careless driving and was fined $30.00. I accept that the agent had told the plaintiff that he must get a lawyer and fight the case.

• (8) In 1961 Jagdeo seized P7300 as there was still the outstanding balance of $ 200.00 remaining to be paid on it and in 1963 he gave it away to a friend of his by the name of Junor.

• (9) In 1963 Chanderdai Adam filed a writ (No. 343/63) against the plaintiff claiming damages in excess of $500.00 for the injuries received by her on 22nd October, 1960 when she was struck down by P7300.

  The plaintiff took the writ and showed it to the agent who told him to leave it with him and that he would “fix up the matter with the company:” The plaintiff then paid the agent the sum of $100.00 which he had promised to pay 3 years previously.

• (10) On 21st November, 1963 the company, through their attorney (Eric S. Stoby & Co. Ltd.) wrote a letter (Ex. “A”) to the plaintiff informing him that they had received a copy of the writ and that there was no record of P7300 ever having been insured with them. He was asked to call at the office and bring any receipt or certificate of insurance as proof that the car was in fact insured with the company and he was also requested to fill out enclosed claim forms.

• (11) Either on 25th or 28th November 1963 (there is a superimposition in relation to the figures ‘25’ and ‘28’) the plaintiff signed a claim form (Ex. “G”) made out by the agent.

• (12) On 4th December, 1963 the company wrote a letter to the plaintiff (Ex. “J”) informing him that they were in receipt of his claim form. He was again reminded to forward his certificate of insurance, premium receipt and insurance policy and they noted that he had enclosed Jagdeo's old certificate of insurance.

• (13) On 13th December, 1963 Mr. Hardyal, of counsel, wrote a letter (Ex. “E”) to the company on the plaintiff's behalf informing the company that no insurance policy had been sent to his client although the transfer had been effected in their office.

• (14) On the said 13th December 1963 Mr. Dabi Dial, the company's solicitor,, wrote a letter to the plaintiff (Ex. “K”) in which he intimated that the company had passed a copy of the writ for his attention and that he was willing to act for the plaintiff in his defence and he forwarded an authority to solicitor for signature. Mr. Dial then requested that he should forward the insurance policy or certificate of insurance if he had them or any of them.

• (15) On 15th April, 1964, Mr. C.A.F. Hughes, of counsel, sent a letter (Ex. “F”) to the plaintiff informing him that the company had given instructions to repudiate all liability under the insurance policy under which P7300 was insured on the ground of non-compliance with certain conditions contained in the policy which he proceeded to set out. It was intimated that if the company were made to pay any sum of money whatsoever they would seek to recover same from him. The company had already filed a defence in the action but were prepared to offer $ 350.00 without prejudice.

• (16) On 29th May, 1964 Mr. Dial sent a...