A PERUSAL OF THE FACT, PLAINTIFFS & DEFENDANT’S COUNSEL’S ARGUMENT, COURTS DECISION AND RATIO DECIDENDIC



IN THE CASE OF: 
LAW UNION & ROCK INSURANCE OF NIG. LTD Vs LINUS ONUOHA

1)   Did the respondent at any time have an insurable interest over the car which he insured with the appellant in view of the trial courts discovery that the car was stolen from where it was parked.
2)   Whether the onus is on the appellant to prove that the respondent at the time he insured the car with it was aware that the car was stolen.
FACTS;
          Here the respondent/ plaintiff claimed against the appellant / defendant, the sum of N 40.000 as an indemnity over an insured car. The car was insured but later got destroyed by fire. The appellant agreed to indemnity the respondent after the
mishap as he had sold the wreck of the car at N1000. The appellant later refused to indemnity the respondent, having discovered that the car was stolen from where D.W.I wife parked it. The respondent then sued asking for an indemnity of N40,000. The parties filed and exchanged pleadings and the court on conclusion of the trial awarded N39. 000 in favour of the respondent.
The appellant was dissatisfied with the judgment and consequently appealed to the court of appeal. The appeal court in determination of the matter considered the provision of section 22(1) of SGA 1983 which is a statute of general application equally applicable in Benue state as follows:-  
“Where goods are sold in market overt according to the usage of the market, the buyer acquires a good title to the goods provided he buys in good faith without notice of any defect or want of title on the part of the seller.”
          The court, unanimously dismissing the appeal held that anyone suing on an insurance policy must have can insurable interest in the subject matter of the policy. It described an insurable interest as the assured pecuniary interest in the subject matter of the insurance. According to it, a court called upon to determine whether or not a particular claimant has an insurable interest in the property concerned will need to consider the issue whether the destruction or diminution in value of the property will result in any loss to the claimant. Also a more possession of property was held to be probably enough to entitle the possessor to an insurable interest in goods.
The court in citing the authority of Macaura V Northen Assurance Co. Ltd (1925) Ac 619 observed thus … indemnify insurance obviously required the assured to have an interest in the subject matter of the insurance other then that created by the contract itself or otherwise, he will  incur no loss through the happening of the event insured against and so if the assured is without a legally recognized interest, the insurer will have a good defence to any claim under such a contract if the chooses to raise it’.
The court read the provision of 22(1) of SGA above as an exception to the nemo dat quod non habet rule. It went further to justify the above rule on grounds commercial convenience and expediency.
The count in buttressing more purport of the above section per Oguntade, JCA at page 589 paragraph B-C observed thus,
Generally speaking, the market system in major cities in Nigeria is not very well organized but it seems to me that spots set aside in any of the Nigeria towns for sale of specific or particular goods and which are publicly patronized  at regular hours and acknowledged as such quality to be described as market overt. I think that the mechanic village at Apir in Benue state where the plaintiff purchased the scrap of the car,  subject matter of the dispute, qualities to be treated as a market overt. I shall so treat it”. The court also expounded the meaning of the phrase market overt to mean an open market. It applies to an open, public and legally constituted market. On the meaning of good faith section 62(2) of SGA deems a thing to be done in good faith within the meaning of the Act if in fact, it is done honestly whether it be done negligently or not. The court further noted that by virtue  of section 74 of the Evidence Act 1990, all courts are enjoined to take judicial notice of all laws and enactments. The trial court then gave judgment to the plaintiff by awarding him N39, 000.
The defendant was not satisfied with the judgment and later appealed on grounds of four issues namely;
A)   The appeal is against the weight of evidence
B)   The trail judge erred in law after finding that the car insured by the plaintiff was a stolen one and not with standing proceeded to give judgment to the plaintiff as if though he has an insurable interest in the stolen car.
C) The learned trial judge erroneously placed the burden of proving that the plaintiff was aware that the car was stolen on the defendant.
D) The learned trial judge having found that the car insured by the plaintiff with the defendant belonged to the D.W.2 and that it was wrong to have enforced the contract insurance thereby implying that  the plaintiff had title to the car. 
The appeal court in dismissing the appeal but adopting the reasoning of the lower count held that the appeal was unmeritorious and consequently awarded cost against the appellant.
Comment:
The courts’ ratio decidendi in the above case is premised on the provision of section 22(1) of the SGA 1990 as presented supra. The effect of the provision is to entitle a bonafide purchaser for value, who has purchased properly in a market overt without knowledge of defect in title or absence of title, to still maintain an action for possessory or ownership right over same.
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