Kelly v Cornhill Insurance Company Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Chancellor,Lord Reid,Lord Morris of Borth-y-Gest,Lord Hodson,Lord Guest |
| Judgment Date | 21 January 1964 |
| Judgment citation (vLex) | [1964] UKHL J0121-4 |
| Court | House of Lords |
| Docket Number | No. 4. |
| Date | 21 January 1964 |
[1964] UKHL J0121-4
House of Lords
Lord Chancellor
Lord Reid
Lord Morris of Borth-y-Gest
Lord Hodson
Lord Guest
After hearing Counsel as well on Thursday the 10th as on Monday the 14th. days of October last, upon the Petition and Appeal of Kevan Philip Kelly. Assisted Person, residing at 402 Moffat Street, Glasgow, praying, That the matter of the Interlocutor set forth in the Schedule thereto, namely, an Interlocutor of the Lords of Session in Scotland, of the First Division of the 2d of November 1962, might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Interlocutor might be reversed, varied or altered, or that the Petitioner might have such other relief in the premises as to Her Majesty the Queen, in Her Court of Parliament, might seem meet; as also upon the Case of the Cornhill Insurance Company Limited, lodged in answer to the said Appeal; and due consideration had this day of what was offered on either side in this Cause:
It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Interlocutor of the 2d day of November 1962, complained of in the said Appeal, be, and the same is hereby, Recalled: And it is further Ordered, That the said Cause be, and the same is hereby, remitted back to the Court of Session in Scotland to proceed in accordance with the majority Opinions expressed in this House: And it is further Ordered, That the Respondents do pay, or cause to be paid, to the said Appellant the Expenses incurred by him in the Court of Session since the 3d day of May 1962, and that the Expenses incurred prior to that date be reserved for determination by the Lord Ordinary: And it is further Ordered, That the Respondents do pay, or cause to be paid, to the said Appellant the Costs incurred by him in respect of the said Appeal to this House, the amount of such Costs to be certified by the Clerk of the Parliaments: And it is also further Ordered, That unless the Costs, certified as aforesaid, shall be paid to the party entitled to the same within one calendar month from the date of the certificate thereof, the Court of Session in Scotland, or the Judge acting as Vacation Judge, shall issue such summary process or diligence for the recovery of such Costs as shall be lawful and necessary.
My Lords,
On the 4th February, 1960, the Appellant was involved in an accident while driving a Humber Hawk saloon car which had been the property of his father, Michael Kelly. The car was so extensively damaged as to be valued at only five pounds after the accident and claims were made against the Appellant by third parties whose property had been damaged.
The Appellant claimed to be entitled to the benefit of a policy of insurance issued by the Respondents to Michael Kelly and to be entitled to be indemnified by them against claims arising out of the accident. The Respondents repudiated liability and the Appellant sought a decree of declarator that he was entitled to be indemnified.
On the 11th April, 1958, Michael Kelly signed a proposal for comprehensive insurance in relation to the Humber car. In that form he stated that the car would be used for social, domestic and pleasure purposes. In answer to the question "Will the car(s) be driven by anyone other than yourself?" he wrote "Yes" and gave the name of the person who would drive the car as Kevin Kelly, writing on the proposal form "I do not drive as I have no licence and do not intend having one". In answer to the question "Will car(s) be driven by one named person only?", he wrote No".
proposal was accepted by the Respondents and they issued to him a policy of insurance for twelve months from the 26th April, 1958. That policy recorded that it had been agreed that the proposal should be deemed to be of a promissory nature and effect and that it was the basis of the contract of insurance and was incorporated in it.
The policy was renewed for a further period of twelve months from the 26th April, 1959, so that the accident in which Mr. Kevin Kelly, the Appellant, was involved occurred before the date of expiry of the policy.
Under the policy the Respondents agreed to indemnify the insured, Michael Kelly, against all sums which he should be legally liable to pay by way of compensation for, inter alia, "Accidental damage to any property (including animals) not belonging to the Insured or held in trust by him or under his control or charge, caused by the insured car". The policy went on to say "In terms of and subject to the limitations of and for the purposes of this Section, this Policy insures:—
"(1) any person driving the insured car on the order of or with the permission of the Insured and who has not been refused any motor vehicle insurance or continuance thereof by any Insurer".
It was not alleged that the Appellant had been refused any motor vehicle insurance or continuance thereof by any insurer. In his condescendence the Appellant averred that upon the completion of the contract of insurance Michael Kelly gave him unlimited permission to drive the Humber car. In their answer the Cornhill Insurance Company admitted that Michael Kelly gave the Appellant permission to drive the car and said:
"It is believed and averred that" Michael Kelly "expressed no limitation of the said permission".
On the 2nd June, 1959, Michael Kelly died, and it was the contention of the Respondents that the Appellant, despite the fact that he had been given permission to drive the car by Michael Kelly, was not driving with his permission at the time of the accident some eight months later.
It must have been apparent to the Cornhill Insurance Company on receipt of the proposal form that the usual driver of the motor vehicle was likely to be Kevin Kelly. By their policy they undertook to indemnify him if driving with the permission of his father against, inter alia, claims of the kind now preferred against him.
If Michael Kelly had continued to live until after the 4th February, 1960, the date of the accident, there would seem to be no valid ground on which the Cornhill Insurance Company could have successfully repudiated liability. The risks which, in return for the payment of a premium, they had undertaken to cover during the currency of the policy were not, in my opinion, altered in any degree by reason of Michael Kelly's death.
The policy is entirely silent as to the effect on the currency of the policy of the death of the insured, Michael Kelly, and if it be the case, as they now contend, that after his death the policy ceased to cover the driving of the car by anyone to whom he had given permission to drive it, it is to be noted that the policy makes no provision for the return of any part of the premium paid for cover up to the 26th April, 1960.
The question for decision by your Lordships can be simply stated. Was Kevin Kelly driving the car on the 4th of February, 1960, with the permission of his father, Michael Kelly, who had died on the 2nd June, 1959? If he was, then the appeal succeeds. If he was not, the appeal fails.
In the majority of cases the question whether a person is driving a car with the permission of the insured is simply a question of fact. In this case it was argued that as a matter of law it was not possible for Michael Kelly to give permission to drive his car which would be effective eight months after his death.
It was argued that it was inherent in the grant of permission, that the permittor should have power during the period covered by the permission to revoke or to cancel it. On this basis, it was contended that any permission given by Michael Kelly during his lifetime ceased upon his death, or alternatively within a reasonable time thereafter, or in the further alternative when the person to whom permission had been given had notice of the death.
No authority was cited to your Lordships in support of this proposition. There is, in my view, nothing in the policy which supports the argument that the word "permission" in the policy meant and only meant permission which during its currency the insured had power to revoke.
The word "permission" by itself cannot be construed as implying that the permission must be one which there is power to revoke, or can endure only so long as the grantor is in a position to revoke it.
In support of their contention the Respondents sought to derive some assistance from the law of mandate. In my view, the relationship of principal and agent is in no way analogous to the relationship between the owner of a car and a person driving with his consent. I do not consider that the effect of death on the relationship of principal and agent affords any guidance to your Lordships as to the proper determination of this case. There is nothing so personal in the relationship between the owner of a car and someone using it with his consent as to lead to the conclusion that the consent is withdrawn automatically by operation of law on the death of the owner.
Permisison to drive a car is consent to the use of a chattel. If a man consents to the use by another of a chattel of his, for a period say of six months, the use of the chattel for that period is lawful during that period, and does not, in my opinion, become unlawful in consequence of the death of the permittor in the course of the six months.
If it did become unlawful on death then a person driving a car with the knowledge that he had obtained the owner's permission to do so, would under the terms of such a policy as that issued in this case, nonetheless be driving uninsured. This would have the consequence that not only would he be liable to prosecution, and, if convicted, to a fine and imprisonment and disqualification from driving; but also any person...
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