CLAIM FOR INSURANCE

Sun (Auckland), Volume IV, Issue 1001, 18 June 1930, Page 11

CLAIM FOR INSURANCE

CITY COUNCIL S ACTION FAILS Holding that no sufficient ground had been established to prevent the company relying on a breach of warranty. Mr. Justice Smith, in a reserved judgment delivered in the Supreme a writ of mandamus brought by the Auckland City Council against the Mercantile and General Insurance Co . Ltd. The action was brought by til*' council as owner of the house. N Totan Street, Ponsonby, to compel the company to expend certain moneys, allegedly due under an insurance policy, in rebuilding the dwelling, which had been destroyed by fire. Tlie property was leased on September 16, 1925. and, by assignments, it finally passed as a leasehold to Airs. Mary Brown, of Auckland. On Janu ary 31. 1927, Airs. Brown insured the* property against lire loss, and the house was destroyed in July. 1929. AVhen the council, as lessor, notified the company it required the policy moneys to be spent in reinstatement of the house, the company refused, contending the policy was issued on the basis of the proposal made by Airs. Brown, who had described tlie property as freehold instead of leasehold. The policy was, therefore, held by the company to be invalid. The defendant company further contended it was induced to issue the policy through Airs. Brown’s having conoealod the fact that the land was leasehold. Tlie contention of plaintiff was that the council had the right to insist upon an insurance company laying out the policy moneys in rebuilding, regardless of whether the moneys were payable between the insurer and tlie insured. His Honour, in dismissing the motion, allowed the company costs as a claim for J£447. Air. Stanton appeared for tin* council and Air. Cornish and Air. Glaistcr for the defendant company.