IN THE CASE OF: LAW UNION AND ROCK
INSURANCE VS ONUOHA
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The issues for determination in this suit are:
1)
Whether the respondent at anytime have
an insurable interest over the car which is insured with the appellant in view
of the trial count’s finding that the said car was stolen from where D.W.I’s
wife parked it1.
2)
Whether the evidential burden of proof
is on the appellant to prove that the respondent at the time he insured the car
with it was aware that the car was stolen2.
FACTS
The matter was before the Benue State
High Court sitting in Makurdi. The respondent/ plaintiff claimed N40,000.00 against the appellant
/defendant as an indemnity over a 504 car insured with the defendant. The
appellant was an insurance company with whom the insured/ respondent insured
his car. The car got destroyed by fire and the respondent claimed indemnity
from the insurer. While the insurer was negotiating to indemnity the insured,
the he claimed and disposed the wreck of the car at N1000.00 and later refused to indemnity the insured on grounds that
it was a stolen car. The respondent consequently sued the insurer for an
indemnity of N40,000. on conclusion
of trials, N39,000.00 was awarded against the appellant and in favour of the
respondent. The appellant then appealed to the court of appeal considered the
provision of section 22(1) of the SGA 1893, a statute of general application
applicable to Benue state providing thus:
“where goods are sold in market over
according to the usage of the market, the buyer acquires a good title to the
goods, provided he buys them in good faith without notice of any defect or want
of title on the part of the seller”.
Unaniviously dismissing the appeal,
the court held hater alia ;
That any one who
sues on an insurance policy can only sue in respect of his own interest unless
by special provision, the law allowing it, the policy is made for the sake of
another or unless some statute says the policy shall endure for he benefit of
somebody else.
It defined insurable interest to mean
the assured pecuniary interest in the subject matter of the insurance.
Therefore the court in determining whether the claimant has an insurable
interest in the properly will delve into the consideration of whether the
destruction or diminution in value of the properly will result in a loss to the
claimant. Further, it held that the possession of property may suffice to
confer an insurable interest on the possessor.
It also held that one who would
forseablity suffer any financial loss form the occurrence of an event, has an
insurable interest in the subject matter which he sought to insure. Citing the
authorities in Macaura V Northern Assurance
Co. Ltd (1925) AC 619, the court observed that indemnity insurance
obviously expects the assured to have interest in the subject matter of the
insurance other than that created by the contract itself, or else he will
incurious 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 he closes to raise it.
Also invoking the authority of chitty on contract vol1, 23rd
Edition, Para 993 & 994; the court
cautioned that the event must either cast upon the assured a legally building
liability or it must affect a right of the assure which is recognized and
protected by the courts.
On
the issue of whether the plaintiff / respondent has acquired a better title on
the properly, having bought same from one with a defective title, the court
interpreted the purport of section 22(1)
of the sales of hood act as an exception to the datrine of nemo dat Guod
noh habet. The statute being one of general application that 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 them in good faith and without the
pant of the seller.
The
court describes the term market overt as applying only to an open, public, and
legally constituted market and the whole transaction must be in the open
market. Also by the wording of section 62 of SGA. Something is said to be done
in good faith within the meaning of the act when it is implant done honestly,
whether it be done netgelitly or not. Therefore under this circumstance, the
buyer acquires a good title to the goods
but an action for conversion lies against the seller as the market overt
protection extends not to him.
In the language of
the court per Oguntede CA at pg 589 para B-C,
“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 the 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
market where the plaintiff purchased the scrap of the car, the subject matter
of this dispute qualities to be treated as a market overt. I shall so treat it”
The
court in consideration of the efficiency of the above law cited the provision
of section 74 of the Evidence Act 1990, the effect of which is that all courts
must take judicial notice of the laws, acts and enactment. After gradually
premising above provisions of the above
provisions of the law, the court found for the plaintiff /
insured and awarded damages against the defendant/ insurer.
Dissatisfied with
the judgment, the appellant insurer appalled on the following grounds:
A.
The appeal is against the weight of
evidence
B.
The learned trial judge erred in law
when having founding that the car insured by the plaintiff with the defendant
was a stolen one and it proceeded to give judgment in favour of the plaintiff
thereby implying that the plaintiff has an insurable interest over a stolen car.
C.
The learned trial judge erroneously
placed the burden of proving that the plaintiff was aware that bought a stolen
car on the defendant when from the circumstance of the case, proof of that fact
was absolutely relevant.
D.
The trial judge having found that the
car insured by the plaintiff with the dependant belonged to D.W 2 and that it
was stolen when the D.W. I’s wife parked it was wrong to have enforced the
contract of insurable thereby implying that the plaintiff had title to the car.
The respondent in
his brief of argument also set issues for determination thus:
a)
Whether the owns f proving
no-disclosure of material facts is on the appellant.
b)
Whether the plaintiff (respondent) was
a bonafide purchaser of the car for value without notice of any insurable
interest.
c)
Whether the learned judge correctly
directed himself as to the onus of proof having regard to the plaintiff and
evidence before the court.
The
argument counsel to the appellant was that as the lower court has found that
the car was a stolen one, the plaintiff who insured the car with the defendant
could not have an insurable interest in the car. He further submitted that the
title which the plaintiff has over the car as illegal and insurable according
to section 21 of SGA 1893. That the title in the car continued to reside in the
time owner D.W.I. to the appellant counsel conterlede that whatever contract
the plaintiff entered with the seller of the car was illegal one. Therefore
once the contract by which the plaintiff acquired the car was illegal, any
contract entered into by the plaintiff from which he could derive benefit was will and void. We cited the authorities of
Onyeuike V Okeke (1976) NSCC. Vol10, 146 at 150. Ekwunife V Wayne (West Africa)
Ltd (1989) 5 NWLR (pt 122) 422 at 450.
The
appellant’s counsel further argued that although a person who buys a stolen car can claim that
he reads not ware that it was stolen, however, it can be deviled that by so
doing, the is assisting the criminals in the disposition of the car. On page 34
of the Records the learned trial judge regarded the plaintiff as an innocent punisher
for value without notice of any defeat in the title of his vendor. The appellant
submits that before the plaintiff could be so qualified, there must have been
evidence that he bought the car in the market overt as required by section 22
SGA.
The
count in holding that a market overt mean an open market noted that the market
system in major cities in Nigeria
is not very organized but it seems to me that spots set aside in any of the
nig. town for the sale publily patronized at the normal hours and accous ledged
as market arialify to be described as a market overt. Therefore the village at
Apir in Benue
state where the plaintiff purchased the scrap of the car, the subject
matter of this dispute qualifies to be a market overt.
In
the final conclusion, the appeal court affirmed the judgment of the lower court
and dismissed the appeal with N 1000.00 cost in favour of the plaintiff/
respondent.
On
my personal evaluation of the above judgment both at the lower and appeal
courts, one cannot but say that it is a
resounding one. The provision of section 22 of SGA cited by the court above is infant,
being dictated by commercial convenience. The provision of the above section
takes cognizance of the fant of limited knowledge and non- omniscient qualities
of man to especially the past title and circumstances that relate to the
ownering of the properly that one has acquired title on. This is a true
demonstration of the three way traffic nature and functional role of law in our
society. The plaintiff / defendant, and the society at large have not been
victimized with the above principal of the law. The law only tend to protect
abonatide purchaser for value who has brought a good in an ideal market overt
without any knowledge of defect in title of the seller. Therefore the rule does
not projects a thieves who has stolen one properly and sill.