You are on page 1of 9

P PIMENTS MULTI PURPOSE & AGRO-MECHANICAL COOP STY v NEW INDIA

INUSRANCE CO. LTD.


2016 SCJ 523
SCR 86785
IN THE SUPREME COURT OF MAURITIUS
In the matter of:Pointe aux Piments Multipurpose and Agro-Mechanical Cooperative Society Ltd
Plaintiff
v/s
New India Insurance Co. Ltd
Defendant
INTERLOCUTORY JUDGMENT
This is a claim arising out of an accident which involved a JCB tractor owned by the
plaintiff and insured by the defendant. The plaintiff has averred that the JCB tractor knocked
against a tree whilst it was being driven on a road and was damaged. The plaintiff made a
claim from the defendant to cover the expenses incurred for the repair of the tractor.
However, the defendant has refused to pay the said claim and the plaintiff is presently suing
the defendant for that sum.
The case has already started on the merits and we are in the process of hearing the
case for the plaintiff. However, the defendant has now raised a plea in-limine-litis which
reads as follow:
The defendant states that the present policy, that insures the plaintiff, is limited
as to the use and is strictly limited as per paragraph 6(a) of the Motor Policy
Schedule and the Contract of Insurance with the plaintiff. The use is solely for
agricultural and forestry purposes and not to be used on a road, on a public road
specially.
It is, essentially, the contention of counsel for the defendant that there is a limitative clause in
the contract of insurance between the parties with the result that the accident would not be
covered by the insurance policy in view of the circumstances in which it occurred. By
agreement of the parties, the matter was heard in the course of a voir-dire where some
evidence was heard first and arguments were offered on the scope and application of the
limitation clause.

Counsel for the defendant called Mr Raj Dhonow, the Claims Manager of the
defendant company. He explained the procedure whereby a person wishing to obtain a
motor vehicle insurance and his insurance company would enter into a contract. The steps
are as follows:
[1] when a person is seeking a motor insurance cover, he is sent a Proposal Form by the
company. The person fills in that Form setting out the particulars of the kind of insurance he
is seeking, signs the Form and sends it back to the Insurance Company;
[2] the company then prepares an Insurance Policy based on the Proposal Form setting out
the conditions between the Insurer and the Insured with respect to the motor vehicle which is
being insured;
[3] if need be, a Schedule is attached to the Insurance Policy in which matters of detail are
set out;
These documents, i.e the Insurance Policy including the Schedule are signed by the
Manager of the company.
[4] when the person pays the insurance premium which has been agreed upon, the
Insurance Company then issues him with a Certificate of Insurance.
These four documents have been produced but it appears that they may have been
wrongly referred to in parts of the court record. A close perusal of the documents shows that:
[1] Doc VD 2 is the Proposal Form;
[2] Doc VD 1 is the Insurance Policy;
[3] The Schedule has been produced as an annex to the Insurance Policy; and
[4] Doc E in the main file is the Certificate of Insurance.
These four documents, therefore, form the basis of the contract between the parties.
Indeed, we can read the following in the heading of the Insurance policy:
Whereas the insured, by a proposal and declaration which shall be the basis of this
contract and is deemed to be incorporated herein, has applied to the company for
[an] insurance
This policy, the schedule and the effective certificate of Insurance shall be read together
and any word or expression to which a specific meaning has been attached therein
shall bear such meaning wherever it may appear.
It is clear from the Proposal Form that the insured was seeking a comprehensive
insurance cover for the vehicle which was described as a private tractor and which,

3
according to him, did not require any additional cover. The insured signed at the bottom of
the third page of the Proposal Form. There is, however, a fourth page in the Proposal Form
containing an item which the insured was supposed to fill and it reads as follows: Purpose
for which vehicle will be used (please tick relevant box) Private Car - Commercial Use
Other. However, this item has remained blank, i.e has not been filled by the insured and has
not been signed by him.
The Insurance Policy clearly states that the insurance is subject to the terms and
conditions which have been stipulated therein:
Now this Policy witnesseth that in respect of the events occurring during the Period of
Insurance stated in the Schedule and subject to the terms, exceptions and conditions
contained herein or endorsed hereon (hereinafter collectively referred to as the Terms
of this Policy) [the underlining is mine].
Paragraph 8(1)(B)(i) then provides the following
General exceptions
The company shall not be liable in respect of
[1] any accident, loss, damage or liability caused, sustained or incurred
(B) whilst the motor vehicle is being
[i] used otherwise than in accordance with the limitations as to use contained in the
certificate.
The motor policy Schedule then provides in paragraphs 7 and 6
[7]. Risk covered: Comprehensive
.
[6] Limitation as to use:
[a] use for agricultural and forestry purpose.
Witness Dhonow stated that his interpretation of the above clauses is that the
company was insuring the vehicle only when it was being used for agricultural and forestry
purposes, that is to say whilst it was operating in fields and forests. According to him, the
tractor is not covered by the insurance policy whilst it is being driven on public roads. The
accident having occurred when the tractor was being driven along a public road, the
company is not liable to make good for the damages sustained by the vehicle in view of the
limitation clause. According to witness Dhonow, the insured should have informed the
company that the tractor would be driven along public roads every now and again and

4
should have taken an additional insurance to cover the tractor whilst it was being driven on
public roads. Had this happened, the premium payable by the insured would have been
increased.
The representative of the plaintiff, Asraf Bundheea, also gave evidence in court. He
stated that an officer of the insurance company filled in the Proposal Form and he signed it.
He explained that he was asked where the tractor would be used and he informed the
representative of the company that it would be used for agricultural purposes in fields.
However, according to him, it went without saying that the tractor would have to be driven
along public roads to go from one field to another. He therefore subscribed for a
comprehensive insurance cover which, he thought, covered all risks, including accidents
which may occur whilst the tractor was being driven on public roads.
In cross-examination, the witness stated that he took cognisance of the limitation
clause. He admitted that, in the contract of insurance, it is not specifically mentioned that the
tractor would be covered whilst it is being driven on public roads. It was put to him that if
there is no such clause in the contract, then it leads to the conclusion that he did not
specifically ask for it. The witness answered that he had asked for insurance cover for the
tractor whilst it would be driven on the road but that the insurance company did not
specifically include such a clause in the contract. He added that he did draw their attention to
that fact. However, they did not correct the contract to include such a clause; instead, they
told him that insurance cover on the road is provided for by automatic application of the
statutory provision under section 60 of the Road Traffic Act.
Comprehensive policy
Counsel for the plaintiff submitted that the insured contracted a comprehensive
policy. He referred to Mauritian Road Traffic Offences Vol I by SB Domah at page 445
446 where the author says the following:
The interpretation of a contract of insurance is dynamic . Words and phrases in a
policy have been the subject-matter of judicial interpretation. The terms used in
insurance contracts are not of a legal text. However, the rules that have been applied to
their interpretation have been the same as those of the interpretation of a text of law:
Moodoo v Coowar.
Counsel then argued that a comprehensive policy means that all damages sustained
by the tractor are covered. He referred to Blacks Law Dictionary which states the
following: as opposed to the position previously where insurers covered vehicle collisions

5
only, comprehensive Auto Insurance now covers all types of incidents that may cause
damage to an insured vehicle which include, but are not limited to theft, fire, weather, falling
objects and animal damage. He further referred to the Concise Oxford Dictionary, 9th
Edition, where the word comprehensive is defined as follows of motor vehicle insurance,
providing complete protection.
We do not have any qualms with the references that counsel for the plaintiff has
placed before us. However, we believe that they have been read rather restrictively and out
of context. Blacks Law Dictionary also provides that Not all causes of damages are
covered by a Comprehensive Auto Insurance. There are also certain exclusions that would
apply which include damage to the normal wear and tear, vehicles defects and other
collision damages which are not included in the comprehensive coverage definition (the
underlining is mine). In the same way, the Concise Oxford Dictionary, 9th Edition, also
provides the following in its definition of the word comprehensive complete, including all
or nearly all elements, aspects, etc (the underlining is mine). It is clear that a motor
insurance policy which is said to be or is described as comprehensive would not
necessarily include coverage for all damages sustained by the insured vehicle. There are
certain damages caused by collisions which would be excluded because the policy may
cover most damages, but not all of them.
Thus, in determining the meaning of the word comprehensive in an insurance policy,
we have to look at the words of the contract in the context in which they have been used
and, in particular, how one clause interacts with other clauses in the contract. There is also a
need to look at the intention of the parties whilst maintaining a purposive approach. We
should not be overly technical, but the contract has to be interpreted bearing in mind that it is
meant to be a dynamic document and not mere dead letters which have been reduced into
writing on paper.

Agricultural and forestry purposes


The first question is how the word comprehensive should be interpreted in the light
of clause 6 of the Schedule which limits the insurance coverage to the use of the tractor for
Agricultural and Forestry Purposes. The word purposes is important - indeed, purpose is
defined as an object to be attained; the reason for which something is done or made, or for
which it exists; a result or effect that is intended (see Shorter Oxford Dictionary). Thus, the
word purposes in the clause would mean that the insurance cover is not restricted to the

6
use of the tractor for agricultural and forestry activities only. Activities would mean what
the tractor is made to do in a field or a forest. But purposes is wider; it would include
activities done in a field or a forest but would also imply other things which are done in the
furtherance of an agricultural or forestry activity. Thus, the movement of the tractor from one
field to another or from one forest to another would be included in agricultural or forestry
purposes.
Transit
The next question is how is this movement from field to field or from forest to forest
meant to be done. The issue is covered by section 1(D) of the Insurance Policy which
provides:
The company will indemnify the insured against loss of or damage to the Motor Vehicle
described in the Schedule and the accessories and spare parts whilst thereon
(D) whilst in transit (including the processes of loading incidental to such transit)
by road, lift or elevator.
Counsel for the plaintiff submitted that when the expressions comprehensive policy
and for agricultural and forestry purposes are read together with section 1(D), it can only
mean that the company and the plaintiff had intended that the tractor would, anyhow, be
insured whilst it is in transit by itself on a road. However, in case, the transit is done by
loading the tractor (on a lorry for example) then that would also be covered. Thus, the
insurance cover for damages caused during loading (on a lorry) would be over and above
coverage for normal transit where the tractor is itself driven along a road to go from one field
to another or from one forest to another.
I do not agree with this interpretation for reasons that will become clear hereinafter.
The way in which section 1(D) has been drafted is essential in working out the intention of
the parties. Let us assume that the section was drafted in the following way:
The company will indemnify the insured whilst [the tractor] is in transit by road,
including the processes of loading incidental to transit by lift or elevator.
In such a case, it would be clear that damage caused whilst loading the tractor on a
lift or an elevator would be covered. Transit by road would stand by itself and it would mean
that damage to the tractor would be covered whilst it is being driven along a road to go from
one field to another or from one forest to the next. It would leave open the issue as to
whether the insurance policy would cover the tractor in the exceptional circumstance of it
having to be loaded on a lorry for transit along a road.

However, the manner in which section 1(D) has been drafted makes it clear that the
word loading applies to:
[a] transit by road
[b] transit by lift; and
[c] transit by elevator.
It is clear that the tractor is covered by the insurance policy during transit, meaning
whilst it is in the act or process of going, or of being conveyed over a distance through a
passage or route (see Concise Oxford Dictionary). There may have been some doubt as to
whether damages sustained during the process of loading prior to or after the transit would
be covered by the insurance policy. Section 1(D) answers that question and makes it clear
that damages sustained in the process of loading would also be covered. Therefore, the
intention of the parties, or in other words, the situations that they were contemplating comes
out clearly. The tractor would have to be loaded on a lift for transit; it would have to be
loaded on an elevator for transit; it would equally have to be loaded for transit by road.
There are two situations which the insurance policy would cover, namely:
[1] whilst the tractor is in transit by road, lift or elevator; and
[2] whilst the tractor is being loaded prior to or after such transit by road, lift or elevator.
We are therefore led to the conclusion that, in view of the exclusion clause, the
insurance policy was not meant to cover damages sustained by the tractor whilst it was
being driven along a public road by itself in order to transit from one field to another. I
subscribe to the view of witness Dhonow to the effect that an additional insurance would
have had to be taken by the insured to cover that situation.
The application of section 60 of the Road Traffic Act
The final argument of counsel for the plaintiff was that, even if the contract can be
interpreted as excluding insurance cover for damages whilst the tractor was being driven on
the road, such exclusion clause would be of no effect by virtue of section 60(1)(g) of the
Road Traffic Act which provides
[1] Where a certificate of insurance has been issued under section 57(3), to the person
by whom a policy has been effected, so much of the policy as purports to restrict the
insurance of the persons insured by reference to
[g] the time at which, or the areas within which, the vehicle is used;
shall, as respects such liabilities as are required to be covered by a policy under section
57(1)(b) be of no effect.

Counsel argued that the present limitation clause purports to restrict the insurance policy by
not covering damages which occur in a specific area, namely a public road and as such is of
no effect.
This argument is obviously misconceived because it fails to take into account the
provisions of section 57(1)(b) which reads as follows:
[1] In order to comply with this Part, a policy of insurance shall
..
[b] insure such person, persons or classes 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..................
It is clear that the legislator meant to declare as being of no effect any exclusion
clause in a contract of insurance where the exclusion clause purports not to provide
insurance coverage to any person who has died or has suffered bodily injury caused by the
insured vehicle whilst it was being driven in any particular area or areas mentioned in the
certificate of insurance. This has no application in the present case where there is no issue
of death or bodily injury sustained by anyone. The issue here concerns damages sustained
by the tractor which knocked against a tree which was found on the side of a public road
whilst the tractor was being driven along that road.
I have duly considered the plea in-limine-litis and the arguments of counsel on both
sides. I find that the point was well taken and I uphold same. The plaint with summons is
accordingly dismissed with costs.

P. Fekna
Judge

20 December 2016
For Plaintiff

: Mr. N. Joomeer of Counsel


Mr. S. Baichoo, Attorney-at-Law

9
For Defendant

: Mr. D. Ng Sui Wah of Counsel


Mr. B. Rampoortab, Attorney-at-Law

You might also like