Australia – The insured had filled out a proposal form for fire insurance incorrectly having failed to mention in his answer to a question about a second of two fires for which he had previously claimed. The proposal form contained a declaration stating that the proposal was the ‘basis of the contract [and] is to be taken as part of the policy and . . the particulars to be deemed express and continuing warranties furnished by’ the insured; there was also an express clause about material misdescription and misrepresentation.
Held: Lord Shaw said: ‘The case accordingly is one of express warranty. If in point of fact the answer is untrue, the warranty still holds, notwithstanding that the untruths might have arisen inadvertently and without any kind of fraud. Secondly, the materiality of the untruth is not an issue; the parties having settled themselves-by making the fact the basis of the contract, and giving a warranty-that as between them their agreement on that subject precluded all enquiry into the issue of materiality. In the language of Lord Eldon in Newcastle Fire Insurance Co v Macmorran (1815) 3 Dow 255,262: ‘It is a first principle in the law of insurance, on all occasions, that where a representation is material it must be complied with-if immaterial, that immateriality may be inquired into and shown; but that if there is a warranty it is part of the contract that the matter is such as it is represented to be. Therefore the materiality or immateriality signifies nothing.’
This rule has been repeated over and over again and is too well-settled to be questioned . . ‘
Judges:
Lord Shaw
Citations:
[1921] UKPC 55, [1921] 2 AC 125
Links:
Cited by:
Cited – Genesis Housing Association Ltd v Liberty Syndicate Management Ltd CA 4-Oct-2013
The housing association was to develop an estate of social housing, supported by an insurance guarantee. The insurance proposal contained a clause stating that the information in the proposal was to form the basis of the policy, and that the policy . .
Cited – Genesis Housing Association Ltd v Liberty Syndicate Management Ltd TCC 8-Nov-2012
Insurers had rejected a claim under the policy, saying that the proposal form had included a basis of insurance declaration warranted by the proposer, and that since it had named a main contractor different to the one named, there was no liability . .
Lists of cited by and citing cases may be incomplete.
Commonwealth, Insurance
Updated: 23 August 2022; Ref: scu.422978
