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E. SFEIR & CO v. NATIONAL INSURANCE COMPANY OF NEW ZEALAND, LTD. PER GLYNDOVA (GHANA) LTD.


  • New
  • 1962-05-18
  • HIGH COURT
  • GLR 370 - 372
  • Print

OLLENNU J.


Summary

Agency?-Special or general agency?-Agents authorised to accept notices of losses and settle claims on marine insurance policies?-Whether agents entitled to sue and be sued on behalf of principals.

Headnotes

The National Insurance Company of New Zealand appointed Messrs. Glyndova (Ghana) Ltd., as their agents in Ghana "for settlement of marine claims". In the event of a claim being made by an insured, the agents were to submit the claim together with their report and all relevant documents to the appropriate branch of the principal's company which "would then make arrangements for settlement of the claim" and the fees of the agents. All the insurance policies issued within the territory covered by the agents were endorsed: "Claims payable by Messrs. Glyndova (Ghana) Ltd.... to whom notice of loss must be given prior to survey."The plaintiffs brought a series of actions against Glyndova (Ghana) Ltd. as agents for their principals. The suits were consolidated. Glyndova contended that the terms of their agency did not make them liable to be sued on behalf of their principals.

Judgement

RULING on an application by Glyndova (Ghana) Ltd., that they be struck out of suits because their agency does not make them liable to be sued on behalf of their principals.

Each of the plaintiff-firms in these consolidated suits is insured with the National Insurance Company of New Zealand ltd., the defendants in each of the said suits, and each claims for loss suffered of cargo they insured with the defendant-company under a marine insurance policy upon the ship S.S. Bygdoy and cargo. In each of the said suits the National Insurance Company of New Zealand Ltd., hereinafter called the Insurance Company, were sued per Messrs. Glyndova (Ghana) Ltd., hereinafter called Glyndova, as their agents.

It was pleaded for the plaintiffs that Glyndova are local agents by whom claims made on the Insurance Company are payable. Glyndova denied that they are agents of the Insurance Company as pleaded by the plaintiffs. They say that the duties they have to perform for the Insurance Company are limited to the assessment of claims on behalf of the Insurance Company, and the forwarding of documents to the Insurance Company or branches thereof. Glyndova contend therefore that they cannot sue or be sued on behalf of the Insurance Company. Therefore the question as to whether or not Glyndova are agents liable to be sued as representatives of the Insurance Company has to be resolved as a preliminary issue, and the proceedings so far have been limited to that issue.

There is no doubt upon the evidence tendered on this issue, both oral and documentary, that Glyndova are agents of the Insurance Company. The question is what is the nature of their agency, is it a special agency or is it a general agency? And if a special agency, what are its limits?

Glyndova's authority to act for the Insurance Company is contained in the letters exchanged between them and the Insurance Company. The extent of their agency or authority therefore depends upon the interpretation to be placed upon those documents. It is a principle of law that while as between the agent and his principal the authority may be limited by an agreement or special instructions, yet as regards third persons, the authority which the agent has is that which he is reasonable believed to have, having regard to all the circumstances, and which is reasonably to be gathered from the nature of his employment and duties in relation to the third persons: see Halsbury's Laws of England, (3rd ed.) Vol. 1, page 161, para. 378; Brady v. Todd1; Cox v. Midland Counties Railway Co.2; Russo-Chinese Bank v. Li Yau Sam.3 Therefore in addition to the letters exchanged between Glyndova and the Insurance Company, the court will also have to look at the endorsement on the policies held by the plaintiff so far as they affect Glyndova, in order to determine whether or not Glyndova are authorised to defend a suit on behalf of the Insurance Company in a claim by the assured based upon the policies.

Exhibit 1, the letter of the 24th December, 1957, by which the Insurance Company offered the agency to Glyndova is headed: "Agency for settlement of Marine claims". The relevant portions of it read:

"We should appreciate it if you would act as our claims settling agents should the necessity arise...

In the event of your being called upon to act on our behalf, your survey report, accompanied by a settlement of claim, insurance policy, letter of subrogation, where necessary, and any other relative documents together with a debit note for your fees, should be forwarded by airmail to our branch which issued the policy concerned. That branch would then make arrangements for settlement of the claim and your fees.

Would you kindly let us have your confirmation that you are willing to act for us under the conditions outlined above."

Taken by itself it cannot be said that exhibit I did anything more than create Glyndova agents solely for the purpose of investigating claims made by an assured and transmitting the necessary documents relating thereto the appropriate branch of the Insurance Company, for the branch concerned, then to make arrangements for settlement of the claim made by the assured and the settlement of fees of Glyndova.

Next is the endorsement on each of the policies as relating to Glyndova; it is as follows: "Claims payable by Messrs. Glyndova (Ghana) Ltd., P.O. Box No. 1271, Accra to whom notice of loss must be given prior to survey". No doubt that endorsement is likely to give an assured the impression that Glyndova has certain authority with respect to payment of claims. But will an inference that Glyndova has authority on their own to admit or reject a claim, and pay a claim upon indemnity by the Insurance Company be a reasonable inference to draw from the said endorsement on the policy, having regard to the class of the agency, the circumstances of the case and the relationship between Glyndova and the Insurance Company and also with the assured? I should think not. See Halsbury's Laws of England (3rd ed.) Vol. 1, page 161.

The inference which I think is fair and reasonable to draw is that after they had admitted a claim, or been adjudged liable on a claim, the Insurance Company may pay a claim through Glyndova.

I hold therefore that Glyndova's agency does not extend to authority to defend suits on behalf of the Insurance Company. Glyndova (Ghana) Ltd., are therefore struck out of the suits. Costs fixed at 25 guineas.

Decision

<P>Ordered that Glyndova (Ghana) Ltd. be struck out of the suits.</P>

Plaintiff / Appellant

E. N. P. Sowah

Defendant / Respondent

E. Akufo-Addo

Referals

(1) Brady v. Todd (1861) 9 C.B. (N.S.) 592

(2) Cox v. Midland Counties Railway Co. (1849) 3 Ex. 268

(3) Russo-Chinese Bank v. Li Yau Sam [1910] A.C. 174, P.C.

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