Wall v New Ireland Assurance Company Ltd
| Jurisdiction | Ireland |
| Judgment Date | 01 January 1967 |
| Date | 01 January 1967 |
| Court | Supreme Court |
Supreme Court.
Insurance - Industrial assurance company - Ten burial policies issued on same life - Insurance cover limited by statute to reasonable expenses of death and funeral - Excessive insurance - Whether policies illegal - Repayment of premiums - Life Assurance Act. 1774 (14 Geo. 3, c. 48) - Life Assurance (Ireland) Act, 1866 (29 & 30 Vict., c. 42) - Insurance Act, 1936 (No. 45of 1936), ss. 50, 53, 61, 75, 109.
Principal and agent - Whether agent's knowledge to be imputed to principal - Agent a privy to fraud or deceit against principal.
Plenary Summons.
The plaintiff, Mark Wall, during the years 1940 to 1954, effected with the defendants, the New Ireland Assurance Co. Ltd., ten industrial policies on the life of his mother, Ellen Wall. The purpose for which the policies were effected was stated by him to be for the funeral expenses which he would incur in connection with the death of his mother. In the proceedings in the High Court the plaintiff claimed that all of the policies, save the first policy, were illegal and ultra viresthe defendant Company as they had, as alleged, been issued contrary to the provisions of the Insurance Act, 1936, and the Assurance Companies Act, 1909; and, alternatively, that the plaintiff had no insurable interest in his mother's life and that all the policies, save the first, were illegal by reason of the provisions of the Life Assurance Act, 1774 (as applied to Ireland by the Life Assurance (Ireland) Act, 1866; and he sought declarations in accordance with these claims, an account of all premiums paid on foot of the policies alleged to be illegal and an order for the payment of the amount so determined.
The facts are fully stated in the judgment of Davitt P., post.
From the above judgment the defendants appealed to the Supreme Court (1). The grounds of the appeal were 1, that the learned President was wrong in law in holding that the
aforesaid policies were ultra vires the appellants' powers and were illegal;2, That the learned President was wrong in law and in fact in not holding that the appellants did not know that the said policies were illegal and/or ultra vires the appellants owing to a false representation on the part of the person who effected or made the proposals for such policies;
3, That the learned President was wrong in law and in fact in holding that the said policies numbered 1487148 and 1618101 effected by the said Ellen Ward upon her own life were in reality effected on the proposals of the said Mark Wall;
4, That the learned President was wrong in law in holding that the said policies referred to in para. 3 hereof were rendered illegal by the Life Assurance Act, 1774;
5, That the learned President was wrong in law in holding that the plaintiff was entitled by virtue of s. 53 of the Insurance Act, 1936, to a repayment of the premiums paid in respect of such policies.
Sect. 50 of the Insurance Act, 1936, enables the defendant company to issue policies of industrial assurance for the purpose of insuring money to be paid for the reasonable expenses connected with the death and funeral of,inter alia, a parent of the person effecting the relevant policy. The plaintiff effected with the defendants two policies in his name with the proper motive of insuring against the reasonable expenses of his mother's death. The plaintiff, by reason of his mother's longevity and the canvassing of the defendants' agents, effected over a period eight further policies with the defendants with the motive of protecting his interest in the existing policies; and that motive was known, and suggested to him, by the defendants' agents who were (with the plaintiff) responsible for the defendants having no actual knowledge of such motive. The first five policies together insured a reasonable sum for such expenses but the sum insured by the ten policies was grossly excessive. The 7th and 9th policies were in the name of the plaintiff's mother and did not contain the plaintiff's name as required by s. 2 of the Life Assurance Act, 1774. The plaintiff sought repayment of all premiums paid to the defendants under all of the policies save the first one. Sect. 53, sub-s. 2, of the Act of 1936 provides that where an industrial assurance company has issued an industrial assurance policy which is illegal or ultra vires the company, it shall repay the amount of paid premiums unless it proves that, owing to a false representation of the person who effected or made the proposal for such policy, it did not know that the policy was illegal or ultra vires its powers.
Held by Davitt P., 1, that the first five policies insured a reasonable sum for such expenses;
2, That all of the policies (save the first two), being effected by the plaintiff for the purpose of avoiding loss on existing policies and not for the authorised purpose, were illegal and ultra vires the defendants' powers, and that the last five policies were also illegal for other reasons;
3, That the defendants must repay the amount of premiums paid under all of the policies save the first two since they had not proved that their ignorance of the illegality of those policies was due to false representations made by the plaintiff;
4, That the plaintiff was not estopped from asserting the illegality of the policies.
On appeal from that decision, in so far as it related to the 3rd, 4th, 5th, 7th and 9th policies, it was
Held by the Supreme Court ( Ó Dálaigh ó dálaigh C.J., Lavery, Kingsmill Moore, Haugh and Walsh JJ.) 1, that the issue of the illegality of the 3rd, 4th and 5th policies involved consideration of the defendants' knowledge when those policies were effected;
2. That, although the plaintiff had a wrong motive in effecting those policies, they were not illegal since the knowledge of that motive, possessed by the defendants' agents, could not be imputed to the defendants as such agents were privies to fraud or deceit against the defendants. Accordingly, the defendants had issued those policies for the Authorised purpose;
3, That the 7th and 9th policies, being made contrary to the provisions of s. 2 of the Life Assurance Act, 1774, were illegal; but that the defendants had proved the exception contained in the provisions of s. 53, sub-s. 2, of the Act of 1936 and were not liable to repay monies by virtue of that sub-section.
Cur. adv. vult.
| Davitt P. :— |
The facts of this case are not really in controversy to any considerable extent, and the effect of the evidence may be summarised as follows: the plaintiff, Mr. Mark Wall, is a merchant carrying on business in Ballygar, Co. Galway. He owns property comprising a dwelling-house, shop and general stores, licensed premises and some twenty acres of land. He at one time carried on a small hotel business and at present, as he has done for some time past, carries on business as an auctioneer and valuer. He has been for some years a member of the Galway County Council, and on one occasion was an unsuccessful candidate for the Dáil. He is a man who is well known and popular in his part of the country. The business and property which he at present enjoys belonged to his father, Mr. Michael Wall, who died in 1935, leaving by his will all his property to his widow, Ellen Wall. By deeds executed in 1946 and 1947 she transferred all her interest in the dwelling-house, land and business premises—in fact practically all her property—to the plaintiff, reserving a right of residence and maintenance. By her will, dated the 21st November, 1946, she left all her property, with the exception of the proceeds of a life policy with the Irish Assurance Co. Ltd., to the plaintiff, whom she appointed sole executor. She died on the 25th April, 1960. She was a plaintiff in this suit as originally constituted and her interest, if any, is now represented by her son, Mr. Mark Wall, who is sole plaintiff in a double capacity. He took out probate of the will on the 21st January, last. The defendants are a limited company carrying on, inter alia, the business of industrial assurance.
During the years 1940 to 1954 the plaintiff effected with the defendants a number of industrial policies on his mother's life. The business appears to have been first canvassed and secured by Mr. Seamus Naughton, then an agent (and shortly afterwards promoted to be superintendent) of the defendant Company, or by Mr. Seamus Burke, then superintendent, or by both. The proposal form sets out that the age of the life to be assured was 60, that the sum to be assured was £49 4s. 0d. and the premium two shillings weekly. It was duly signed by the plaintiff as proposer and his signature was witnessed by Mr. Burke. Having regard to the provisions of s. 50 of the Insurance Act, 1936, the defendant Company required that, in all cases where the sum to be assured exceeded twenty-five pounds, the proposer should make and sign a declaration that the amount was for reasonable expenses in connection with the death and funeral of the person proposed. A printed form, known as the "R.F.E." (Reasonable Funeral Expenses) form was provided for this declaration. This was as follows:—
I .................... the Proposer do hereby declare that the amount proposed by me to the Company in the attached proposal (together with the amount already assured by existing policies) is presumed to be reasonable expenses in connection with the death and funeral of the Proposed for the following reasons:—
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United Dominions Trust (Ir) Ltd v Shannon Caravans Ltd
...case, applicable. However, the matter is put beyond doubt by the decision of this Court, in Wall v. New Ireland Assurance Company Limited 1965 I.R. 386, in which the circumstances in which knowledge of the agent is to be imputed to his principals was considered by this Court. In that case, ......