Austin v Zurich General Accident & Liability Insurance Company Ltd
| Jurisdiction | England & Wales |
| Date | 1944 |
| Court | Court of Appeal |
Insurance - Motor-car - Extension of cover to person driving with insured's permission - Double insurance - Subrogation - Breach of condition - Condition unknown to permitted driver.
The defendant company issued a policy of motor-car insurance to one A., containing an extension clause covering any person driving the motor-car with the insured's permission, provided that such person should, as though he were the insured, observe, fulfil and be subject to the terms, exceptions and conditions of the policy in so far as they could apply. The policy contained a condition that “every letter claim writ summons and/or process shall be notified or forwarded to the company immediately on receipt.” While the plaintiff was driving the motor-car with A.'s permission, an accident occurred, as a result of which A. died and another person was injured. Actions brought against the plaintiff were settled by his own insurers. In an action by the plaintiff for the benefit of his own insurers, the defendants denied liability on the ground of a breach of the condition set out above, in that the plaintiff had not notified them of summonses issued against him for dangerous and careless driving at the time of the accident. The plaintiff contended that the condition had never been brought to his notice and that he was not bound by it:—
Held, that the principle that a party to a contract is not bound by conditions which are not brought to his notice has no application to the case where a person, who is not a party to any contract, seems, under a statutory provision, to take the benefit of a document. Such a person must take the document as he finds it, and cannot select those parts which suit him:—
Held, also (per MACKINNON L.J. and UTHWATT J.) that this was a claim for double insurance, not subrogation, and the action should have been brought by the plaintiff's insurers in their own name, and not by him on their behalf.
APPEAL from Tucker J.
On May 23, 1938, the plaintiff Austin was driving, with the consent of the owner, a Lincoln Zephyr motor-car, the property of one Aldridge, when he met with an accident. Aldridge and one Nicholson were passengers in the car at the time of the accident, as the result of which Aldridge died and Nicholson was injured. Actions were brought against the plaintiff by the executrices of Aldridge and by Nicholson. The plaintiff was insured by the Bell Assurance Association (“the Bell association”) in respect of his own motor-car, under a policy which covered him while driving any other private car not belonging to or hired by him, for pleasure purposes. The Bell association undertook the defence of the two actions brought against Austin and settled them for substantial sums. At the time of these settlements, Austin signed the following agreement which was endorsed on counsel's brief: “I agree to the below-mentioned terms and I agree either to assign to the Bell Assurance Association such rights as I may have against the Zurich Insurance Co., and/or to allow them in my name to proceed against the said Zurich Insurance Co., to recover the whole or any part of the said sums for the benefit of the said Bell Assurance Association.”
The claim was brought against the Zurich General Accident and Liability Insurance Co., Ld., in the following circumstances. The Zurich company had issued to Aldridge a policy, which was in force at the date of the accident, covering, inter alia, third party claims arising out of accidents caused by or through or in connexion with his Lincoln Zephyr car. Cover was by s. 1, para. 1, of the policy, extended to any person driving that car with the insured's permission. That extension, however, was subject to the provisos: (a) that such person was not entitled to indemnity under any other policy, and (b) that such person should, as though he were the insured, observe, fulfil and be subject to the terms exceptions and conditions of the policy in so far as they could apply. The policy contained certain general conditions, including (inter alia): “1. The insured or his legal personal representatives shall give notice in writing …. as soon as possible after the occurrence of any accident and/or loss and/or damage with full particulars thereof. Every letter writ claim summons and/or process shall be notified or forwarded to the company immediately on receipt. Notice shall also be given in writing to the company immediately the insured or his legal personal representatives shall have knowledge of any impending prosecution or inquest in connexion with any accident for which there may be liability under this policy. 5. If at the time any claim arises under this policy there is any other existing insurance covering the same loss damage or liability the company shall not be liable …. to pay or...
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