AN INSURANCE CLAIM.

Taranaki Daily News, 30 June 1922, Page 6

AN INSURANCE CLAIM.

LOSS OF A MOTOR CAR. SUPREME COURT JUDGMENT. In the Supreme Court at New Plymouth during the last sessions, an action was brought by Norman Burke against the Standard Insurance Co. of New Zealand, under an insurance policy on a motor ear which was burned near Woodville. The action was defended on the ground that it was not brought within three months after the claim was rejected, and that there had been a breach of warranty resulting in a forfeiture under a condition in the policy that the car was not to be used for business purposes. Mr. Justice Reed who heard the case has now given his reserved decision. In the course of his judgment, his Honor says: There" was no admissible evidence tendered in support of the second defence- In regard to the other defence the judgment said: The defendant purported to reject the claim in a letter dated May 10, 1921, and the writ was not issued until November 10. If, therefore, the letter of May 10 be held to be a final rejection, obviously the action was commenced too late. Thu plaintiff claimed that the defendant company by its correspondence treated the question of liability as still open for negotiations and consideration and thereby, in effect, withdrew its notice of rejection .... After reciting authorities on the law the judgment states: A condition in the policy limiting the time in which an action may be •brought is a lawful condition. Although an actual dispensation or waiver of a condition can only be effective if made strictly in accordance with the terms of the policy—e.g. by endorsement in writing on a policy, yet, if the insurance company by its action or conduct, induces the insured, as a prudent man, upon reasonable grounds to suppose that it does not intend to insist on the fulfilment of the condition, the company will be stopped from setting up the breach of that condition in answer to an action on the policy. Were there, therefore, any facts or circumstances which occurred after the rejection ’ipf the claim which the plaintiff was entitled, as a reasonable man, to regard as a withdrawal of the rejection so far as to excuse him from the performance of the condition requiring him to bring an action within three months for such rejection. The answer to the question entirely depends upon the construction to be placed upon the correspondence between the partier After dealing fully with the correspondence the judgment proceeds .... The onus is upon the plaintiff of satisfying me .... that he has been led by the conduct of the company to believe, and is justified in helievijig that the performance of the condition is not in the circumstances, required. The plaintiff has given no evidence to that effect, and even if he had, I should have held that there was no reasonable ground for his belief, and that therefore, it was not justified. Judgment will be for the defendant with costs on the middle scale as on a judgment for £4OO with disbursements to be ascertained by the registrarMr. Loughman (Palmerston North) appeared for the plaintiff and Mr. R. k H. Quilliam. for the defendant company.