DAWSONS BANK, LTD Vs. VULCAN INSURANCE CO , LTD

JUDGEMENT

(1.) This is an appeal from the High Court at Rangoon sitting in appeal, which reversed the decision of the trial Judge in a claim brought by the appellants upon a policy of insurance against fire. The premises were situated at Moulmeingyun in Burma. The appellants were the mortgagees of the premises, who, in accordance with the terms of the mortgage, had taken out a policy of insurance upon the mortgaged property. The particular policy was taken out with the respondents, the Vulcan Insurance Company, Limited. The premises had apparently at one time been insured in the Northern Assurance Company, but they had ceased to carry the risk. It was said that they had withdrawn from fire business in Rangoon; whether that is so or not their Lordships do not know. At any rate, in 1929, the policy was taken out with the Vulcan Insurance Company, having originally been written by the Northern Assurance Company. The risk and description of the property was, it is said, taken from the original policy with the Northern Assurance Company. It is described as being: " Three buildings, the property of the insured, situated at the corner of Strand Road and Ferry, Moulmeingyun, Myaungmya District. Said buildings are constructed of brick walls and cement flooring in the ground storey, timber walls and flooring in the upper storey with shingled roof. Used as retail shop for hazardous and nonhazardous goods in the ground floor and above as dwellings."

(2.) There was a fire by which the premises were totally destroyed in March 1931, and on a claim being made, after some delay in making up their minds, the insurance company finally resisted the claim on the footing that there had been a material misdescription of the property. It is admitted that there was, in fact, a misdiscription of the property, and the only question is whether the misdescription was a material misdescription, by which one would ordnairily mean a misdesciiption such as would affect the mind of a reasonable insurer either as to accepting the risk or as to the premium which he would place upon the risk. Whether a misdescription is material or is not, is partly a question of evidence, and also partly a question of law. In this case the learned trial Judge said he was not satisfied that the misdescription was material, and the learned Chief Justice and his colleagues thought the misdescription was material.

(3.) It is not very easy to ascertain what was the exact condition of these premises, because at one time apparently they consisted of only one building, and at another stage in the proceedings when a policy was taken out, they had been divided laterally into three buildings, and their Lordships were told that at the time the fire took place they had been divided into five buildings, so that there were five shops and buildings overhead. But the question as to the number of buildings is not very material in this case. The question is whether the building was properly described as "constructed of brick walls and cement flooring in the ground storey." It is admitted that it was not so correctly described, and the question therefore is whether that misdesciption was material.