liability of insurer to settle third party claims

Today's case on Nigerian Insurance Court Cases blog:

 ISSUES:  Insurance, liability of insurer to settle third party claims, notice of intention to bring an action, service of notice; form of and proof of service by post, prima facie proof of delivery, dispute as to receipt, duty of court to resolve as issue of fact, motor vehicle (third party) insurance act section 10.   
Judgment; award, interest on award imposed by court, power of court to impose. 

National employers mutual general insurance association Ltd -Appellant Ladun Martins -Respondent
 
Suit at the Supreme court of Nigeria on the 22nd of december, 1969 before;
• Coker JSC
• Madarikan JSC
• Fatayi-williams JSC


COUNSEL: 
• GL Impey for appellant
• AA Oshodi for respondent
 
FACT:   
The respondent as plaintiff in the court below sought a declaration that the appellants (an insurance company) was liable to pay a judgment debt awarded against him in a motor claim third party action by virtue of an insurance policy which subsisted between them and by the virtue of section 10 of the motor vehicle (third party) insurance act. In order to prove service of his intentions to bring an action as required by the insurance policy as a condition precedent to bringing the action, the respondent tendered two letters, viz; exhibit K which merely stated that his solicitors would carry out further instructions if his demands were not met, and exhibit M which clearly stated that an action was being brought. Evidence was led by the respondent that the letters were sent through the post. The appellants denied receiving exhibit M, though they admitted receiving exhibit K.
 
The high court of Lagos (Lambo J) gave judgment in favor of the respondent and awarded 4% interest on the judgment debt until paid. On appeal to the supreme court.
 
HELD:

A. Exhibit K is not a sufficient notice under section 10 subsection 2 of the motor insurance third party act as it merely contains a warning that if certain demands were not met within the period stated therein, the plaintiff's solicitors would carry out further instructions.
 
B. Exhibit K cannot amount to proper notice under section 10 subsection 2 as it did not notify the insurers of the bringing of an action against the insured.
 
C. Exhibit M was sufficient notice under section 10 subsection 2.
 
D. Proof that the letter was properly addressed and posted is prima facie evidence that it was delivered to the addressee in due course but where the addressee has led evidence that he did not receive the letter, then a straight issue of fact is raised and before making a finding of fact as to the delivery or non delivery of the letter, the court ought to examine the evidence carefully.
 
E. In the instant case the trail judge sufficiently reviewed the evidence and was fully justified in coming to the conclusion that the original of exhibit M was delivered to the defendants.
 
F. Having regard to order 46 rule 7 of the supreme court (civil procedure) rules, the Lagos high court was acting within the limits of its power when it awarded 4% interest on the award it made. Appeal dismissed.
 
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