Qaqanaqele v Sakil [2012] FJHC 1326; HBC048.2009 (29 June 2012)

IN THE HIGH COURT OF FIJI ISLANDS
AT LABASA
CIVIL JURISDICTION

Civil Action No: HBC 048 of 2009

BETWEEN:

MOSESE QAQANAQELE
[Plaintiff]

AND:

ABDUL SAKIL
[1ST Defendant]

AND:

ALI IMDAD
[2nd Defendant]

AND:

SUN INSURANCE COMPANY LIMITED
[Third Party]

Counsel : Kohli & Singh for the Plaintiff
Messrs Maqbool & Co. for the Defendants
Messrs Gibson & Co. for the Third Party

Date of Judgment : 29th June, 2012

RULING

1. This is the ruling on the Notice of Motion filed by the 3rd party against an order of the Master of Labasa High Court.
   

Background facts:

2. The plaintiff's daughter died due to a motor traffic accident on 18.03.2006. As the Administrator in the estate of his late daughter,the plaintiff has filed a writ of summons against the 1st and 2nd defendants claiming damages.
   
3. The 1st defendant is the driver of the motor vehicle which knocked down the deceased.The 2nd defendant is the registered owner of the said vehicle.
   
4. On 18th of July 2011, the 2nd defendant filed an ex-parte Notice of Motion seeking leave to issue 3rd party proceedings against Sun Insurance Company (the 3rd party). Upon consideration of the motion, the Master granted leave for the 2nd defendant to issue 3rd party notice against Sun Insurance Company.
   
5. Having been aggrieved by the decision of the Master, the 3rd party filed a Notice of Motion seeking following relief.
   

a. That the order granting leave to issue 3rd party proceedings be set aside;

2. That the 3rd party proceedings and summons issued in the above action be struck out; and,
   

100. That the 3rd party be awarded costs on an indemnity basis.
     

6. In support of the motion, an affidavit was filed by Peter Fimone one of the Insurance Consultants of the Sun Insurance company.
   
7. The main grounds advanced by the 3rd party in support of its motion are as follows:
   
   1. Full disclosure was not made by the 2nd defendant to the court on the ex-parte application;
      
   2. Section 11 (1) of the Motor Vehicle (3rd party Insurance) Act provides that the insurer is only is liable once a judgment is obtained in the proceedings; and,
      
   3. Section 11 (2) of the Motor Vehicle (3rd party Insurance) Act provides that the insurer is not liable to pay any judgment if no notice of the bringing of proceedings has been given to the insurer within the required time.
      
8. The 3rd party's main contention as can be seen from the affidavit and its submissions is that it is not required to pay any judgment as the requirements stipulated in section 11(2) of the Motor Vehicle (3rd party Insurance) Act have not been complied with by the plaintiff, i.e. the writ of summons were not served on the 3rd party within 7 days of the issue of the proceedings.
   
9. For clarity and convenience, I reproduce section 11 of the Motor Vehicle (3rd party Insurance) Act which reads:
   
   1. 11 (1). If, after a certificate of insurance has been delivered under the provisions of ss. (4) of s 6 to the person by whom the policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under the provisions of paragraph (b) of ss. 1 of s 6, being a liability covered by the term of the policy, is obtained against any person insured by the policy, then notwithstanding that the insurance company may be entitled to avoid or cancel or may have avoided or cancelled the policy the insurance company shall, subject to the provisions of this section, pay to the persons entitled to the benefit of such judgment an sum payable in respect of costs and any sum payable by virtue of any written law in respect of interest of that sum.
      

(2) No sum shall be payable by an approved insurance company under the provisions of subsection 1-

(a). In respect of any judgement unless before, or within 7 days after the commencement of the proceedings in which the judgment was given, the insurance company has notice of the bringing of the proceedings; or

(b). in respect of any judgment so long as execution thereon is stayed pending an appeal.

10. Section 11(1) of the Act imposes a statutory liability on the insurer to pay the sum of a relevant judgment against a person insured to the person in whose favour the judgment has been awarded.
    
11. The 3rd party submitted that since no notice of proceedings was given to the insurer within the required time, the 3rd party insurer had no liability. It placed much reliance on section 11(2) of the Act and also cited Dominion Insurance Ltd v. Bamforth [2003] FJSC 3.
    
12. The main issue before this court is whether the 2nd defendant was required to serve 7 days notice on the 3rdparty insurer pursuant to section 11(2) of the Act.
    
13. However, a careful analysis of section 11(2) of the Act shows that the requirement of giving 7 days notice applies only for the plaintiff who seeks recovery against the insurer. It does not require that the defendant is bound to serve 7 days notice on the 3rd party.
    
14. The above position is further confirmed by the supreme court of Fiji in Dominion Insurance Ltd v. Bamforth [2003] FJSC 3, where it states:
    

'The nature of section 11(2)(a) as a condition precedent to the insurer's statutory liability suggests that its satisfaction is a matter to be demonstrated by a plaintiff seeking recovery against the insurer (emphasis added) rather than its non-satisfaction being a matter which the insurer must show in order to resist the plaintiff's claim against it.'

15. It is common knowledge that an institution of an action is known to the defendant only when he received summons or notice. Therefore one could not expect the defendant to give notice of the action to the insurer before the expiration of 7 days after the commencement of proceedings.
    
16. Therefore, the failure of the plaintiff to serve the Notice of the proceedings pursuant to section 11 (2) of the Motor Vehicle (3rd party Insurance) Act to the 3rd party insurer, does not help the insurer to escape from its obligations to indemnify the insured (the 2nd defendant). Accordingly, in the instant case the 2nd defendant is entitled to be indemnified pursuant to the policy of insurance.
    
17. Hence, it is my considered view that the insured should not be affected by any inaction of the plaintiff and, therefore, he is entitled to be indemnified by the 3rd party insurer under the insurance policy provided by it which was in force at the time of the accident.
    
18. Upon consideration of the above, I see no reason to intervene with the ex-parte order made by the Master, Labasa.
    
19. Therefore, I dismiss the 3rd party's motion. Action shall take its normal cause.
    
20. Costs shall be in the cause.
    

Pradeep Hettiarachchi
Judge