Clico International General Insurance Ltd v Aubryn Bridgeman
| Jurisdiction | Barbados |
| Judge | Burgess JA |
| Judgment Date | 28 December 2018 |
| Neutral Citation | BB 2018 CA 13 |
| Court | Court of Appeal (Barbados) |
| Docket Number | Civil Appeal No. 4 of 2015 |
| Date | 28 December 2018 |
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL
The Hon. Andrew D. Burgess, The Hon. Kaye C. Goodridge, Justices of Appeal and The Hon. Margaret A. Reifer, Justice of Appeal (Acting)
Civil Appeal No. 4 of 2015
Mr. Larry Smith, Ms. Shanna Goddard and Mr. Fabian Walthrus for the Appellants
Mr. Bryan Weekes and Mr. Philip McWatt for the Respondent
Insurance Law — Contested insurance claim for destroyed vehicle — Whether the claim was fraudulent — Assessment of damages — Special damages — Interest — Taxation — Breach of contract — Misrepresentation — Contra proferentem rule — Errors of law — Burden of proof — Ikarian Reefer principle.
This appeal concerns a claim by the respondent against the appellants for an indemnity under a policy of insurance covering, inter alia, loss by fire. In his claim, the respondent alleged that his maxi taxi van which was insured with the appellants caught fire fortuitously and was totally destroyed by the fire. The appellants resisted the respondent's claim on three broad bases. The first was that the respondent made untrue statements in the proposal form and was thereby precluded from claiming under the policy of insurance. The second was that the fire did not occur fortuitously, but was either deliberately set or recklessly caused by the respondent and that he had made a fraudulent claim to the appellants. The third was that the respondent had not proved some of the loss for which he claimed the indemnity.
The matter came on for hearing before Chandler J on 29 September 2005; 24 and 27 February 2006; 3, 4, 5, 8, 9 and 17 May 2006; 30 October 2006; 1 and 2 November 2006; 31 January 2007; 1 February 2007; and 15 July 2010. The written decision of Chandler J was delivered on 19 February 2015.
In his decision, Chandler J upheld the respondent's claim and rejected the defences raised by the appellants. The judge entered judgment for the respondent in the sum of $286,023.88 with interest thereon at the rate of 8% per annum from the date of judgment until payment. Costs certified fit for one counsel to be taxed if not agreed were also awarded to the respondent.
This appeal challenges that decision of Chandler J.
The appellants are a limited liability company incorporated and registered under the Companies Act, Cap. 308 and an insurer registered under the Insurance Act, Cap. 310. At all material times, the appellants carried on the business of providing insurance coverage to clients from its registered office situate at Whitepark Road, Bridgetown, St. Michael.
The respondent is a businessman whose business is providing public transportation. At all material times, he was the owner of a 2000 Isuzu maxi taxi van bearing the registration number ZM-257 which he operated for hire and/or reward in his business.
The maxi taxi van was a second hand vehicle which the respondent had purchased on 11 October 2000 from St. Hill's Funeral Home for $98,000.00. The purchase price was obtained by way of a mortgage loan secured by real property in which the respondent had an interest.
On the same 11 October 2000, the respondent attended the offices of the appellants to insure the maxi taxi van. There, the respondent completed all the “questions” in a document entitled “PROPOSAL FOR COMMERCIAL MOTOR VEHICLE INSURANCE” (the proposal form). Questions 5 and 13 and the “DECLARATION” in the proposal form are of particular relevance in this case.
Question 5 headed “Particulars of vehicle(s) to be insured” contained a section asking: “If a PASSENGER VEHICLE, please state:- Seating capacity (including driver)”. The respondent entered “10” in the column opposite this question.
Question 13 read, in so far as relevant: “Please tick if the vehicle is to be used as follows: (d) Carriage of passengers for hire or reward (Enter number of passengers below).” The respondent ticked this box and entered “10 Seater Maxi Taxi” in the box immediately below Question 13.
A declaration at the bottom of the questions in the proposal form, in so far as relevant, read as follows:
“DECLARATION:
(1) I declare that to the best of my knowledge and belief the above statements made by me or on my behalf are true and complete.
(2) I agree that this proposal and declaration shall be the basis of the contract between me and the Company and I agree to accept a policy in the Company's usual form for this class of insurance.”
The respondent dated and signed the completed proposal form immediately below that declaration.
On 25 October 2000, the appellants approved the respondent's application for insurance and issued to the respondent insurance policy number CG/MMT/009930 (the policy of insurance), which insured the maxi taxi van against, amongst other perils, fire. The respondent paid a premium of $9,728.81 as consideration for the insurance coverage. The sum insured was $98,000.00.
On the evening of 4 December 2000, whilst the respondent was driving along Graeme Hall Road, Christ Church, the maxi taxi van was completely destroyed by fire.
On 5 December 2000, the respondent went to the office of the appellants and informed them that the van had been destroyed by fire on the previous day and that he was making a claim for his loss pursuant to the terms of the policy of insurance. The respondent's statement to the appellants as to the “details of the accident or loss as it occurred” was as follows.
“When I passed the Ministry of Agriculture I smelled smoke so I slowed down and pulled up the engine cover situated beside the driver's seat and realised that there was fire coming from a wire in the engine. I then pulled over to the side of the road and stopped. I tried to get the battery connections off but I was unable to. The back seats then started to catch afire so I moved away because the glass was beginning to fly.”
On 7 December 2000, the respondent gave the following statement to D.C. Craig & Associates Ltd, the loss adjusters appointed by the appellants:
“. As I travelled down the slight hill and had just passed the entrance to the Ministry of Agriculture (on the opposite side of the road) I smelt something like plastic or rubber burning. I did not see any smoke at that stage. I slowed down and lifted the engine cover which was to the left beside me. As I lifted the engine cover I saw a gush of smoke. I saw a thick wire leading to the kill switch on fire. The whole wire was burning and the metal within the wire was red hot. The power to the vehicle then cut out. I coasted down the hill for a short distance and pulled over to the verge before stopping. By this time there was a lot of smoke in the vehicle and there was a reflection of light under the bus which confirmed that there was a fire. I jumped out of the bus as soon as I stopped and opened the front left door. I tried to shake off the two battery leads but they would not disconnect…Flames soon started to engulf the front area by under the fuse box and also beneath the rear passenger seats where a number of electrical wires were. After the initial outbreak of fire the flames spread quickly throughout the passenger compartment assisted by the heavily padded seats which are high. There were also about three or four loud explosions which seemed to be connected to the air conditioning unit at the rear of vehicle in the roof. The explosions appeared to be centred around the said air conditioning unit.”
The appellants refused to settle any part of the claim for the loss of the maxi taxi van on the ground that the fire was not fortuitous and so informed the respondent by letter dated 15 May 2001. In consequence, the respondent commenced an action in the High Court against the appellants for the appellants' refusal to indemnify his loss.
The action by the respondent, then plaintiff, against the appellants, then defendants, was commenced by the filing of a writ of summons and statement of claim on 17 May 2002. In it, the respondent alleged that, under the policy of insurance, the appellants agreed to indemnify him against loss of, or damage to, the maxi taxi van and its accessories and spare parts thereon, caused by fire to such an extent that it became a total loss. He pleaded that, on 4 December 2000, during the currency of the policy of insurance, the maxi taxi van was damaged by fire to such an extent that it became a total loss. He further pleaded the sum insured was $98,000.00 and that on 5 December 2000, he delivered to the respondent a claim in writing in respect of the loss, but that, in breach of the policy of insurance, the appellants failed to settle any part of that loss and that, as a result he suffered loss and damage.
Under the particulars of special damage, the respondent claimed loss of profits in the sum of $50,000.00 for the period January 2001 to the date of the filing of the writ. In the general prayer for relief, he claimed:
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“1. The sum of $98,000.00.
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2. Damages.
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3. Interest.
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4. Costs.
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5. Any further or other relief which the Court might deem appropriate.”
The appellants filed a defence which was subsequently amended and reamended. In the re-amended defence filed on 18 December 2003, the appellants admitted knowledge of the fire and receipt of the respondent's claim under the policy of insurance. However, they denied liability to indemnify the respondent's loss on three grounds.
First, the appellants pleaded that the respondent had in the proposal form declared that “to the best of his knowledge and belief the statements made by him.in the said Form were true and complete”. This declaration, as well as the remainder of the proposal form, were by the respondent's agreement made the basis...
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