Meat Company Claims £77,850

Star (Christchurch), Volume XLIV, Issue 142, 17 June 1931, Page 8

Meat Company Claims £77,850

CASE IS SEQUEL TO BIG EARTHQUAKE. Per Press Association. GISBORNE, June 17. The hearing was commenced in the Supreme Court, before Mr Justice Blair, of an action in which the Wairoa Farmers’ Co-operative Meat Company and the Bank of New Zealand claim against the New Zealand Insurance and Eagle Star and British Dominion Insurance Companies £77,850 for damage to the .Wairoa Free ring Works allegedly caused by a. fire on February 5. Plaintiffs are represented by Mr Harold Johnston, K.C., Mr L. T. Buraard and Mr Lloyd Wilson, and defendants by Mr A. Gray, K.C., Mr H. P. Richmond and Mr A. H. Johnstone. The case is expected to occupy several days. Plaintiff’s Statement. The statement of claim asserts that by a policy dated August 31, 1929, defendants insured plaintiffs against loss or damage by fire or lightning at their works and plant at Wairoa, the total amount of insurance being £139,176'. On February 5, 1931, the buildings and contents were destroyed or damaged by fire, the loss and damage resulting being assessed at £77,850. Details and particulars of the loss were delivered to the defendant companies on March 17, but the defendants wholly neglected and refused to pay—and, further, have repudiated their liability —or to enter upon an ascertainment or assessment of loss or damage. Plaintiffs, therefore, claim the amount of the loss with interest. The Defence. The statement of defence alleges that if any part of the premises insured was destroyed by fire, which is denied, such premises consisted of one building only and not separate buildings. They deny the plaintiffs’ allegations as to fire and the loss therefrom. They admit receiving a declaration and schedule and that they refused to pay on same. Defendants allege clause 5 of the conditions of the policy. Clause 5 is as follows: “If the whole or any part of any building hereby insured, or containing property hereby insured, or the whole or any part of a building of which it is part shall fall, or become displaced, all insurance by this policy or its contents shall cease, unless the assured shall prbve that the fall or displacement was caused by fire.” February ’Quakes. The defendants allege that if destruction and damage occurred it was after part of the building had fallen and become displaced by reason of earthquakes on February 3, 4 and 5. Alternatively, defendants allege that plaintiffs had failed to prove that such fall or displacement was caused by fire. For a further defence, defendants assert that the insurance does not under any circumstances cover loss or damage occasioned directly, or indirectly, proximately, or remotely through, or in consequence of earthquake, or other convulsion of nature, and that plaintiffs have failed to submit proof that the alleged loss was not so caused. Right to Arbitrate. Defendants quote clause 9 of the policy, requiring notice and endorsement if a trade or manufacture is altered, or if the nature'of the occupation or the circumstances affecting the building are changed; also clause 18 relating t 6 arbitration in the case of differences. Defendants state that difference has arisen and they claim the right to arbitrate. “ Meant Everything.” Mr Harold Johnston, K.C., in opening the -case, stated that to the plaintiffs, th,e amount claimed meant everything—solvency or bankruptcy. The stoppage; of the works had already caused considerable loss to the district and if they w r ere not ready by September the loss would be almost untold. The case was also of importance throughout the Dominion to people who had lost chimneys. The Underwriters’ Association in March advertised that owners of properties damaged by ’quakes could rest assured that the policies remained free and at no time had there been remission by the companies of any preifiium on the view that the policies had ceased by reason of earthquake damage. Defendants were adopting the defence that they had had to discard in all other cases in the Dominion. Effect of ’Quake. The works of the plaintiffs were practically untouched by the ’quake, so little damage being done that it could have been repaired by the staff in a couple of days. Up to the moment of the fire the works were operating normally. The fife was located by the works staff fire brigade and a constable in “C ” store, which store had been out of commission for four or five years, and in which was nothing the earthquake could have caused to ignite. The electric wires in the store had been cut and tapped, so it was not possible that electric current caused the fire. The building was electrically dead. There could not be a clearer case of nonearthquake fire. Machinery Operated. After the quake the machinery operated perfectly and they got the normal reduction of temperature. The policy was on the buildings set out separately with their contents, vet the defendants pleaded that the policy was on the whole building and were suggesting that because the parapet on one building fell the whole policy was vitiated.