Sale of Good Act & Insurance Law
Sale of Good Act & Insurance Law
Sale of Good Act & Insurance Law
Implied Condition on Sale by Description (section 15)/ sample (section 17) Implied Condition on Fitness for purpose (Section 16 (1a))
Attention: Read the Lecture Notes before you read the short notes to make you understand well.
Insurable Interest
CASE 1 : Nyanyang Insurance Co.Ltd vs Salbiah Ram bought car and insured on his name. Then Ram sold the car to Nas under installments. Nas met in accident. So, Ram has insurable interest because the car was driven by Nas with Rams permission. Ownership transferred to buyer, seller has no insurable interest on the subject matter.
Attention: Read the Lecture Notes before you read the short notes to make you understand well.
Duty of Disclosure
A person is only required to disclosure material facts A material fact is a fact that an insurer should know when deciding whether to insure If a fact is not material, non-disclosure does not affect the validity of the contract The test of material facts is whether the facts could influence the mind of prudent insurer in deciding whether to accept the risk & if so, at what premium CASE
CASE 1 : Goh Chooi Leng vs Public Life Co. Ltd
FACT
A life insurance contract was made with the defendant company. The plaintiff made a false statement in the insurance policy. In the previous occasion the plaintiff was treated for pulmonary tuberculosis. But he didnt disclosure this info in the policy. So, the insurance co. denied to pay the insurance money. A took out a comprehensive car insurance policy [covers risk of damage to car, risk of personal injury & liability to third party]. A car was involved in an accident. A was liable and rd the 3 party died. A made an insurance claim. Investigation by insurer led to discovery that A had been summoned for driving without license & for falling to display L sign. The insured answered the question, For what purpose are the premises occupied? In his application for fire insurance by stating, Sundry shop downstairs, the welling first floor. Fire broke out. It appeared that there was for grinding mills for grinding curry powder at the back of shop.
HELD
The contract is voidable for nondisclosure of material info
CASE 2 : New India Assurance Co. Ltd vs Pang Piang Chong 1971
Court held that this is not a material fact because the insurance company should not be concerned with convictions The insurer were not misled as to the nature of the insurance the appellant wished to take and in respect of what goods and there was no evidence to show in what way the presence of the grinding mills was considered to increase the risks with respect of the property.
Non-Fatal, Non-Disclosure
Non material fact Fact known to insurer Fact not known to insured CASE : Kathirvelu vs Pacific & Orient Insurance Co. Bhd HELD : The insurance co. cannot repudiate the insurance policy on the ground of nondisclosure of material facts since there was no evidence that the insured was suffering from the illness at the time he signed the proposal form.