AN INSURANCE CASE.

New Zealand Mail, Issue 932, 10 January 1890, Page 20

AN INSURANCE CASE.

INTERESTING JUDGMENT. Mr Robinson, R.M., gave judgment yesterday in the case Bertie v. the Equitable Insurance Company of the United States. This, it will be remembered, was a case in which the plaintiff sought to recover LIOO, compensation for false representations alleged to have been made by the defendant Company in connection with an insurance policy, inasmuch as they informed him (by their principal officer, Mr Triggs) that if he rook out a semi-tontine policy for LSOO he could draw the amount, with profits, at the end of twenty years. The plaintiff stated that he had never read the policy signed by him, which document, being put in, showed that theLsoo was payable at death, with the proviso that when 20 annual payments have been made no further payments should be required ; no profits to be paid until the full period of 20 years has elapsed ; the insured to be at liberty, at the end of that period, “ to withdraw in cash this policy's entire share of the assets, i.e., the accumulated reserve fund, and in addition the surplus appropriated by the Society fc© this policy,” or “ to withdraw in cash the share of the accumulated surplus apportioned by the Society to this policy, and to continue the policy in force on the original plan.” No provision was made for the insured drawing out the amount insured on the policy, with the accrued profits. His Worship went into the evidence on both sides (already fully reported) at length, and said that upon the facts he could only come to the conclusion that the plaintiff had been misled throughout as to the nature of his contract—first by Triggs, who induced him to enter into the contract, and again by Ross. The plaintiff's evidence was that Ross, in answer to a question whether he should receive the LSOO and profits at the end of the five years, said “Yes, certainty,” Mr Ross explaining, in his evidence, that he meant that the plaintiff would receive about L6BB, as the reserve would amount to L 314, and the estimated accrued bonus wculd be about L 373. This being an action for deceit, and not for recision of contract, the question to be considered was, therefore, whether false statements were made fraudulently. The case of Peck v. Derry (37 Ch. Div. 541) on which the plaintiff principally relied, had since been reversed by the House of Lords (L. J. 6L, N.S. 265), when it was held that if a man make a false statement honestly believing it to be true, it is not sufficient to support an action for deceit to show that he had no sufficient grounds for his belief. His Worship went on to say that he found as a fact that Triggs made the misleading statements not himself believing them to be true, and that they were therefore fraudulent. He was in a position where it was his duty to know the truth, and must necessarily have been an expert; and there were no grounds for h’s believing the statements. As regards Ross’ statements, he heffi that, though not in themselves false, they were made to induce the plaintiff to make another policy, and put in such a way as to confirm him in false belief ; and consequently they were fraudulent. His Worship was of opinion that Ross and Triggs, being not merely subordinate agents, but local representatives of the Company, acted within the scope of their employment for the benefit of their employer, who was consequently liable. With respect to the limitation of the power of agents, he pointed out that in the case re Arthur Average Association (De Winton and Co. ’s case, 34, L.T. Rep., N.S., 942)the parties aggrieved had notice of the limitation of the agent’s notice. He did not think the plaintiff’s negligence to acquaint himself with the jieyras of the policy should cause him jbo Jose jiis Remedy. With respect to costs, fihe treasure of damage must be the dlflerence 'hetwfien the'-present yaluo of such a policy as tjie plaintiff was .lecjl to expect he was getting, and that which hA actually .held. .Under an endowment policy Re would have got LSOQ with profits at the end of 20 years ; and uiiuet 1 the policy he -field' - J&q guaranteed “reserve” or surrendered Value at completion of tontine period would he L 314, to which profits would be added, but the profits were not guaran-

teed, and the Court could not take them into account. The difference between LSOO and L 314 (L 186) was what the plaintiff would lose if he lived to complete the tontine period. That LlB6 would accrue in 16 years’ time, and its present value therefore, at 6 per cent., would be about L 75. He had also to take into account, however, the chances that the plaintiff might not live to the end of the tontine period, or might not keep up his annual payments ; and for these chances, especially the latter, a very considerable deduction must be made. Judgment would be given for the plaintiff for LSO, with costs L 5 11s.