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Prasad v QBE Insurance (Fiji) Ltd [2007] FJHC 84; HBM 27.2006 (19 December 2007)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No : HBM 27 of 2006

BETWEEN:

RAVINESH PRASAD
Plaintiff

AND:

Q.B.E. INSURANCE (FIJI)
LIMITED
Defendant

Counsels: Mr. R.P. Chaudhary for the Plaintif
Mr. F. Hanif for the Defendant

Date of Hearing: 16th November 2007
Date of Judgment: 19th December 2007

JUDGMENT

BACKGROUND:

This action is the result of an unsatisfied judgment sum in civil action 223 of 1997. The plaintiff in this action had filed civil action 223 of 1997 against Nirmala Sharma and Amitesh Kumar Sharma. It was a claim for damages to some items and for personal injuries. The writ of summons was served on the insurance company on the day it was issued by the court. The insurance company namely QBE Insurance (Fiji) Limited was the Third Party insurer. The insurance company was served in compliance with Section 11 of the Motor Vehicles (Third Party Insurance Act) Cap 177. The insurance company engaged solicitors. It also changed solicitors. On 14th April 2005 the hearing date was fixed for 4th August 2005. On the hearing date counsel for the defendants withdrew from the action on grounds of lack of instructions. The case was formally proved. A judgment was delivered by Justice Finnigan on 11th August 2005.

The defendants made an application to set aside the judgment. That application was heard partly on affidavits and supplemented with oral evidence. Justice Finnigan refused to set aside the judgment after considering affidavits and oral evidence. He made certain findings of fact. That ruling has not been appealed.

The present action is the result of the insurance company’s refusal to satisfy the judgment entered in civil action 223 of 1997. Proper service of the writ of summons on the insurance company is not disputed. In fact it was represented by solicitors.

This is an application under Section 11(1) of the Motor Vehicles (Third Party Insurance) Act Cap 177. This section provides an insurance company must satisfy a judgment which has been entered against the owner of the insured vehicle. It reads:

"If, after a certificate of insurance has been delivered under the provisions of subsection (4) of section 6 to the person by whom a policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under the provisions of paragraph (b) of subsection (1) of section 6, being a liability covered by the terms of the policy, is obtained against any person insured by the policy, then, notwithstanding that the insurance company may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurance company shall, subject to the provisions of this section, pay to the persons entitled to the benefit of such judgment any sum payable thereunder in respect of the liability, including any amount payable in respect of costs and any sum payable by virtue of any written law in respect of interest on that sum."

[underlining is mine for emphasis]

Mr. Hanif relied on Rapeka Naba v. Tower Insurance (Fiji) Limited – ABU 81 of 2000. That case can be distinguished from the present because in Rapeka Naba the driver had never held a driving licence. Here the driver had a licence even though it was a learner’s licence.

The writ of summons was served within seven days; the judgment has not been stayed, the policy had not been cancelled. It was still in force at the time of the accident.

Why is the defendant refusing to satisfy the judgment? In the affidavit filed on behalf of the defendant by Kamlesh Narayan sworn on 8th March 2007 and another by John Hunt on 7th December 2006, the defendant says that the driver of the insured vehicle was a learner driver and he was not accompanied by another driver who held a driver’s licence and therefore the terms of the insurance policy were breached and it was not liable. It seeks that this issue be decided by oral evidence.

Impressive as this argument might appear on the face of it, in the circumstances of this case it is stillborn.

Amitesh Kumar Sharma was the driver of the vehicle which was involved in the accident. He was charged for two offences namely Careless Driving and contravening the condition of Learner’s Permit in that he failed to display letter ‘L’ in front and back of the motor vehicle. He was convicted for these two offences. He was not charged nor convicted for the offence of driving without the presence of a licensed driver. Surely, if police noted that there was no ‘L’ plate, then they would have noticed if the learner’s driver was unsupervised.

The insurance company is relying on an interview its investigator had taken from Amitesh Kumar Sharma. In it he had stated that no licensed driver was traveling with him at the time. However that is an interview note, an unsworn statement. It was an interview of a young person aged 17 years taken with no parent or guardian being around. Amitesh Kumar Sharma gave sworn evidence in HBC 223 of 1997. That record of his sworn evidence is annexed to the affidavit of Pravin Narayan Gosai sworn on 13th March 2007. In his evidence in court he stated he had learner’s permit. He told the court that he was accompanied by a driver named Mahendra Raj who used to drive trucks for his dad’s logging company.

Further there was one more witness namely one Rajesh Kumar whose record of evidence is also annexed to the affidavit of Gosai. This person happened to be at the scene of the accident. Among other things he told the court that "There were two boys in the van Sir, that’s all I know, Sir". This witness’s evidence would therefore confirm presence of the supervising driver Mahendra Raj in the vehicle.

Justice Finnigan who heard the evidence came to the conclusion that Amitesh Kumar Sharma was accompanied by a supervising driver. It is a finding of fact and he was best placed to make that finding. Now the insurance company wants to reopen this finding and expect another judge to make a finding contradicting the finding of fact by Justice Finnigan.

The insurance company was aware of the proceedings. It had engaged counsels. Even if it had not engaged counsels it was incumbent upon it to keep track of the proceedings.

The matter does not rest here. There is also further evidence contained in the affidavits filed that points to the fact that Amitesh Kumar Sharma was not alone in the vehicle. Ravinesh Prasad in his affidavit sworn on 13th October 2006 stated in paragraph 9 –

"That I recall that when the accident happened someone else was sitting in the vehicle on the passenger side. My bicycle hit the rear left side of the vehicle and I had a clear view of the cabin of the vehicle."

The investigator’s interview was conducted on 15th August 1997. The insurance company had the necessary information with it to seek declaration from the court that it was entitled to avoid the policy under the provisions of Section 11(3) of the Act. The insurance company did not do this and is now coming ten years later to obtain the same result.

The defendant’s arguments that the judgments of Justice Finnigan in Civil Action 223 of 1977 between Ravinesh Prasad v. Nirmala Sharma and Amitesh Kumar Sharma are judgments in personam and therefore not binding on the insurance company cannot be sustained in the face of clear statutory obligation imposed on the insurance company under Motor Vehicles (Third Party Insurance) Act. The insurance company is duty bound to pay the judgment sum to the plaintiff. The plaintiff is asking for what he is statutorily entitled to under Section 11(1) of the Act. This is a disturbing application by an insurance company to evade its statutory obligations.

The plaintiff has established that the judgment relied upon was against a person whose liability was covered by the terms of the policy. The setting aside of the judgment will serve no purpose. On the material before me I remain unpersuaded that the insurance company even has an arguable defence let alone a defence which carries with it any degree of conviction or prospect of success.

Accordingly I refuse to set aside the judgment. The defendant’s application is dismissed with costs summarily fixed in the sum of $2,500.00. These costs are in addition to all costs ordered previously in HBC 223 of 1997 and in these proceedings.

[Jiten Singh]
JUDGE

At Lautoka
19th December 2007