INSURANCE CLAIM

Wanganui Chronicle, Volume 74, Issue 151, 29 June 1931, Page 7

INSURANCE CLAIM

WAIROA FREEZING COY. [ Per Press Association. ’ GISBORNE, June 27. When the Supreme Court this morning resumed the hearing of the Wairoa Aleat Co.’s claim for £77,850 against the New Zealand and Eagle and Star Insurance Companies, Air Gray, K.C., addressed the Court on behalf of the defence.

Counsel again referred to the reluctance of Wairoa residents to give evidence detrimental to the plaintiff company. Tho ’quake on February 3 undoubtedly did much damage throughout tho district, and the freezing works also suffered. Under the policy the company was protected against loss by fire, but pertain important conditions were imposed. This Court would not be greatly assisted by precedents, as there was only one reported English case on question. It was clear, however. that the onus was on plaintiff to show that tho damago was caused by fire and was not consequent upon fall or displacement in any part of the building, in which case the policy would be voided. Another condition of thv policy was that tho insured should acquaint the companies of any displacement.

His Honour: In this case the insurance companies knew as much as the Freezing Company. The former have not rushed round with a cheque for the unexpired portion of the premium. ”

Air Grey, continuing, submitted that for the purpose of the policy all of the buildings owned by the company formed one building. Certainly there were several buildings, but only one policy and one premium. If any part of any building was injured by fall or displacement then tho whole policy would automatically be voided. The evidence clearly showed that substan tial damage had been done and it was a reasonable inference that the ’quake affected the whole block, and, that being so. the insurance companies’ liability ceased. Mr Burnard’s Address. Air L. T. Burnard addressed the Court for plaintiff. He said that the defence was based on three exemption clauses, which were ambiguous. The provision for a breach in clause five was that all insurance should cease, which was different from clause six, which appeared to effect suspension. In regard to clause five, counsel submitted that one part of tho clause apparently related to a building which was part of a larger building not insured and therefore had no application to the case. He submitted that the wording meant that if part of a building fell insurance should cease on that part. The only reason of tho clause was to protect the company against the fall of a building or part. It was not an earthquake clause. Where conditions wanted to go further and protect the company from hurricanes, earthquakes and so on. it set them out in the next paragraph. Counsel submitted that tho last words, “unless the assured should fall, or displacement is duo to fire,” placed the onus on tho defendants. Tho works were destroyed by fire, and it was upon the defendants to make good the logs by fire. When on March 31 plaintiff’s solicitors wrote, the company received a reply: “Your buildings are fully covered.” They were referring to this policy, and if the whole or any part were displaced, then the telegram was untrue. The company, in that telegram, had said that the buildings had not fallen or been displaced, for if they had they would not have been covered. Giving a consistent meaning to the policy as a whole, the company was prepared to pay for the loss of the building damaged or not at the time of the fire, subject to certain exceptions.

After analysing tho evidence of Air Jummer, Auckland architect, Air Burnard, contended that the evidence was so clear .that the earthquake had nothing to do with tho fire that ho did not propose to deal further with it. Dealing with tho second part, of the clause, one had to consider the clause

as a whole. Tn the terms of the clause, it had no relation to fire. It said that tho company should not bo liable for certain things, but didn’t link them up with fire. It had seemed extremely doubtful whether the facts as proved came within the clause.

Air H. P. Richmond replied brieflv to Mr Barnard’s arguments and his Honour reserved his decision.