Osman v J. Ralph Moss Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE SACH,LORD JUSTICE EDMUND DAVIES,LORD JUSTICE PHILLIMORE |
| Judgment Date | 10 February 1970 |
| Judgment citation (vLex) | [1970] EWCA Civ J0210-2 |
| Court | Court of Appeal (Civil Division) |
| Date | 10 February 1970 |
[1970] EWCA Civ J0210-2
Lord Justice Sachs
Lord Justice Edmund Davies and
Lord Justice Phillimore
In The Supreme Court of Judicature
Court of Appeal
(On appeal from His Honour Judge Herbert Q.C. sitting at Westminister County Court.)
Mr A. Nicholson (instructed by Messrs. Lissner & Co.) appeared for the appellant.
Mr. George Cheyne (instructed by Messrs. Chamberlain & Co.) appeared for the respondent.
This is an appeal from a judgment of His Honour Judge Herbert given at Westminster Country court on the 14th May last year. The action was one in which the plaintiff happens to be of Turkish origin whose ability to read and understand English is at any rate limited. Indeed, there may be some doubt as to whether he can read at all. The defendants are insurance brokers who have since been taken over by another firm and whose director (bearing the name that appears in the title of the firm) was in Canada by the time that the action came on for trial.
The action was one in negligence, and the origin was as follows. On the 9th December, 1966, on toe defendants' recommendation the plaintiff took out a motor policy with Belvedere Motor Policies, Ltd., a company whose shaky financial foundation was held by the learned judge to have been well known in insurance circles at that time. For that policy the plaintiff paid a premium of £18. 17s. 6d, which was to provide cover for the year that followed. Within the next 10 weeks the policlies Issued by that company became quite worthless, but the defendants not only failed during that period to Inform the plaintiff of this fact but actually wrote him in misleading terms to which further reference will be made. As a result, the plaintiff became and remained uninsured. Upon becoming involved in an accident he became liable to a third party in damages and in addition he was fined for driving without any insurance policy.
The learned county court judge, having rightly found the defendants to be negligent, gave judgment for the plaintiff. He awarded the plaintiff the sum of £18. 17s. 6d. the amount of the premium paid, but in the circumstances held that any further damages suffered by the plaintiff was remote. The plaintiff now appeals on the quantum of damages. There Is no cross-appeal on the issue of negligence or cross-notice on any other point.
The sequence of events wad as follows. On the 9th December the plaintiff, who had previously been insured with a company of the highest reputation, General Accident, considered that the premium being charged by that company were higher that he thought were being paid by his friends, so he asked the defendants to find him another insurer. There upon it was that the defendants negligently recommended this Belveder company which, together with another company, the London & Midland Insurance Co. Ltd., which underwrote Its policies, was much under attack In the financial press. That was something which was held at the trial must have been know to the brokers, though It was not know to the plaintiff. In those circumstance It was that the plaintiff completed a proposal form, he paid the sum of £18. 17s. 6d., a yearns premium, to the brokers and was handed by them a 60-day cover note with the usual certificate of insurance appended to it, as is normal with cover notes. Those 60 days expired on the 7th February, 1967. Meanwhile the brokers, on whom lay the duty not only of advising their client, but also in the circumstances of protecting him, wrongfully and negligently failed either to inform him as to whether the proposal had been accepted, in which case he bad been insured by a substantially worthless policy, or whether it had not been accepted, in which case he was wholly an insured. The plaintiff not unnaturally assumed that all was in order.
Then on the 15th February the defendants reeved from the Belvedere company a note, the material part of which reads "In accordance with your instructions we have to advise you that insurance has been effected and your account has been debited."
On the 20th February a compulsory winding-up order was made against the London & Midland, who underwrote the Belvedere policies, and it then became manifest that the policy which the plaintiff had obtained was wholly valueless - and when I say valueless I mean to those such as insurance brokers who became aware of and could appreciate the facts. Onthe 20th February the defendants should accordingly at ones have made it crystal clear to this particular plaintiff of limited linguistic abilities that he was in a most dangerous situation. They should have told him that he was in effeet uninsured. In fact with crass negligence they wrote the letter NO,8 in the bundle which contained a statement which was really the severs of the truth. It started off: "Re Motor Insurance. We would refer to the above insurance, and would advise you that you are at present insured with the Belvedere Motor Policies Limited". There could hardly be anything more misleading than that to this particular man. It is true it goes on to say: "We would suggest that you insure yourself with another insurance company." It is also true that some recipients would have regarded that as a warning, however inadequately phrased, but to my mind to this particular plaintiff, whose characteristics were known to the defendants, it would simply not convey the warning which should have been given and indeed it would not have conveyed that warning to a great number of people.
To say to somebody, "You are insured," when in fact he is uninsured is calculated to mislead and to fob off enquiries as to what happened to the £18 premium. In the result the plaintiff did nothing. His case indeed is that he did not receive this letter, but there is no finding to that effect by the county court judge and in this court, as at the trial, it has been assumed that he did receive it.
Things ran on then to the 11th June. On that occasion he had the accident already referred to. He brought it to the attention of the defendants with a view to making a claim under his policy. Then on the 15th June, for the first time, he was informed by the defendants that he was uninsured.
To continue the sequence of events, on the 19th October, before the Becontre Magistrates, having pleaded guilty to driving without an insurance policy, he was fined £25 He was also find £10 for another offence to which he pleaded guilty, driving without due care and attention.
In respect of his mitigation placed before that court he incurred costs to the extent of £31. 10s. Od.
Next one comes to the 30th December. There, at the Shoreditch County Court there came for decision the case brought against him by the driver of the other car concerned in the accident. The proceedings were undefended, and Indeed there was no defence. In the upshot judgment was entered for the plaintiff in that action for Sums which, including costs, totalled £244. 3s.9d. That figure was made up as follows: repairs to the car damaged by the then defendant's negligent driving, £l56. 19s. 6d., hire of a replacement car by the plaintiff in the Shoredith action, £50; and £37. 4s.3d. for costs.
At the trial of the action now under appeal the learned county court judge held that all damages suffered by the plaintiff as a result of the 11th June accident was too remote to recover. The sole ground given by him was that the original cover note and certificate having only related to the 60 days; the plaintiff ought to have known thereafter that as he had not received a year's certificate he was uninsured. With all respect, that ignores the opening part of the defendants' own letter of the 20th February, a letter vigorously criticised by the county court judge himself. It also ignores that the plaintiff having paid a year's premium and having received no indication that his proposal had not been accepted or that his premium was going to be returned would, not unnaturally, assume that he had got what he had paid for, that is to say, a year's cover. There has been no cross-notice given on behalf of the respondents setting up any other ground on which the judgment can be supported, nor has there been anything adduced in argument before this Court which to my mind could be a proper subject of any such cross-notice. Accordingly it seems to me that this appeal must succeed as regards liability for damage suffered on account of what happened on the 11th June.
It is now necessary to turn to the individual items which make up such total as should be recovered by the present plaintiff. First there are for consideration the sums which were the subject of the Judgment in the Shoreditch county court. As to the £206. 9s.6d. the cost of repairs and of hiring a replacement car, the defendants cannot in this case escape from liability for sums assessed in the county court as being the true amount of the damages suffered by the driver of the other car. As to the sum of £37. 4s.3d. for costs however, it seems to me that any reasonable defendant, even if unable to pay into court the amount of his liability ought to have taken immediate steps when the summons was issued to say that he would submit to judgment for the amount claimed and offer to pay by instalments. That would obviously have saved costs, and it does not seem that this plaintiff should in this action recover more that £5 out of the £37. 4s.3d.
Next I turn to the fine of £25. Having examined the authorities as to cases where the person fined was under an absolute liability, it appears that such fined can be recovered in that circumstances such as the present as damages unless it is shown that there was on the part of the person fined a degree of mens reaor of culpable negligence in the matter which resulted in the fine. The onus in cases such as the...
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