INSURER IS HELD LIABLE FOR DEATH /BODILY INJURY OF INNOCENT THIRD PARTY ARISING FROM SNATCH THEFT / ROBBERY COMMITTED FROM A MOTOR VEHICLE INCLUDING MOTORCYCLE….
Some interesting development (not sure if there were already other similarly decided cases) concerning a snatch theft crime committed from a moving motorcycle on another motorcyclist within the confines of a public road.
This recent case law concerns P&O Insurance appealing against the lower courts’ decision for the airieaggrieved third party, Kamacheh a/p Karuppen. The snatch theft resulted in the other motorcyclist falling and injuring herself. She sue the owner of the motorcycle who had earlier allowed his son to use and henceforth committing the said crime resulting in her injuries and sufferings. She successfully obtained judgement in default against the owner and his son. Since the payment was not forthcoming….she proceeded to seek recovery from P&O under s90 of RTA 1987.
The Session courts found for the plaintiff and P&O is liable to settle the awarded sum. This went further to the High Court and finally having the appeal decided at the Court of Appeal level. Some interesting comments made by the Court of Appeal judges:
Section 94 and 95 of the RTA 1987 prohibits an insurer from relying on certain terms in an insurance policy for the purposes of excluding liability. On the other hand a term or condition which does not come within the purview of section 94 and 95 may be legitimately relied upon by the insurer for the purposes of excluding liability under the policy when a claim is brought by a third party. The question now is whether Section 91(1)(b) of the RTA 1987 can be legitimately relied upon by the Appellant to exclude liability. The answer to this question lies in section 95(k) of the RTA 1987 itself. Section 95 (k) of the RTA reads thus:
“(k) the motor vehicle being used for a purpose other than the purpose stated in the policy, shall, as respects such liabilities as are required to be covered by a policy under paragraph 91(1)(b), be of no effect .”
It is noteworthy to mention here that section 95(k) of the RTA specifically states that an insurer cannot rely on any conditions which purports to restrict the insurance of the persons insured by reference to the matters set out therein inter alia that the motor vehicle was being used for a purpose other than the purpose stated in the policy
The mechanism of section 96 of the RTA 1987 operates thus: there is a statutory obligation created by section 96 of the RTA 1987 on the part of the insurer (Appellant) on being so notified on the failure of the insured to pay up the judgment sum that the insured had failed to be satisfied in favour of the third party. This duty to pay up is statutory in origin and as said earlier is an exception to the concept founded upon privity of contract.
In order for the Respondent to succeed in her claim under section 96 of the RTA 1987 the requirements in respect of the insurance policy under s 91(1) of the RTA must be fulfilled first. Section 91(1) of the RTA 1987 sets down the requirements in respect of policies, where policy of insurance must be a policy which:
“(a) is issued by a person who is an authorized insurer within the meaning of this Part; and
(b) insures such person, or class of persons as may be specified in the policy in respect of any liability which may be incurred by him or them in respect of the death of or bodily injury to any person caused by or arising out of the use of the motor vehicle or land implement drawn thereby on a road.
Provided that such policy shall not be required to cover –
(aa) liability in respect of death arising out of and in the course of his employment of a person insured by the policy …; or
(bb) except in the case of motor vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, liability in respect of the death of or bodily injury to persons being carried in or upon or entering or getting onto or alighting from the motor vehicle at the time of the occurrence … or
(cc) any contractual liability.”
Provision (a) of section 91(1) is a non-issue here. The problem lies with the fulfilment of proviso (b). Under the normal circumstances the Respondent as a third party would have been able to institute her claim within the confines of the said provision. However this is not the situation here as learned counsel for the Appellant’s grouse had been very specific in that his client (the insurer) ought not to be held responsible to indemnify the Respondent because the injuries caused to the Respondent had been attributed to the criminal conduct of the insured. Such criminal conduct relating to the use of the motor vehicle that was insured by the Appellant was not within the contemplation of the Appellant when it had agreed to underwrite the policy to cover the insured’s use of the motor vehicle.