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Statutory Reform of the Doctrine of Uberrimae Fidei in Insurance Law: A Comparative Review

Published online by Cambridge University Press:  28 June 2019

Kehinde Anifalaje
Kehinde Anifalaje*
Affiliation:
University of Ibadan, Nigeria
*
[email protected]
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Abstract

The common law doctrine of uberrimae fidei is pivotal to all contracts of insurance. It imposes a duty on the parties to act towards each other with utmost good faith by disclosing all material facts and not misrepresenting any fact, either before the contract is formed or while the contract subsists. This article examines the doctrine and its statutory reforms in Nigeria and the United Kingdom. It argues that, before the statutory interventions, the iniquitous doctrine was a potent weapon, most often used by insurers to defeat just and legitimate claims by an insured. Although the legislation has brought some measure of relief to the insured in these jurisdictions, the article concludes that there are still some grey areas in the Nigerian law that need to be addressed to further the cause of justice between the contracting parties.

Keywords

Utmost good faithcommon law reformstatutesNigeriaUnited Kingdom
Type
Research Article
Information
Journal of African Law , Volume 63 , Issue 2 , June 2019 , pp. 251 - 279
Copyright
Copyright © SOAS, University of London 2019 

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Footnotes

*

Lecturer, Department of Commercial and Industrial Law, Faculty of Law, University of Ibadan, Oyo State, Nigeria.

References

1 Campbell, Lord in Walters v Morgan (1861) 3 De GF & J 708 at 723Google Scholar.

2 According to Lord Atkin in Bell v Lever Bros Ltd (1932) AC 161 at 227: “There are certain contracts expressed by law to be contracts of utmost faith where material facts should be disclosed, if not, the contract is voidable. Apart from special fiduciary relationships, contracts for partnership and contracts of insurance are leading instances. In such cases, the duty does not arise out of the contract; the duty of the person proposing the insurance arises before the contract is made.” Other types of contracts in this category are contracts to take shares in companies, such as in Derry v Peek (1889) 14 AC 337Google Scholar, and contracts relating to all kinds of family arrangements, such as in Gordon v Gordon (1821) 3 Swan 400Google Scholar and Greenwood v Greenwood (1863) 2 De GJ and Sn 28Google Scholar. All other forms of contracts are, generally, subject to the caveat emptor rule, that is, buyer beware.

3 Bryan, G Black's Law Dictionary (9th ed, 2009, Thompson Reuters) at 1152Google Scholar.

4 Jessel, MR in London Assurance v Mansel (1879) 11 Ch D 363 at 370Google Scholar.

5 Mansfield, Lord in Carter v Boehm (1766) 3 Burr 1905 at 1909Google Scholar.

6 Decree No 40. This decree was repealed and its provisions were re-enacted verbatim as secs 48–58 of the Insurance Decree of 1991, No 58, which was itself repealed and re-enacted as secs 58–68 of the Insurance Decree, 1997, No 2 and subsequently as secs 54–63 of the Insurance Act 2003, cap I 17 Laws of the Federation of Nigeria (LFN) 2004.

7 Until recently, UK insurance law was largely based on the Marine Insurance Act, 1906 (MIA 1906). Before the enactment of the Consumer Insurance (Disclosure and Representations) Act 2012 and the Insurance Act 2015, insurance regulators and the insurance market introduced intermittent regulatory measures. These included measures under the Financial Ombudsman Scheme established in 2000 by part XVI of the Financial Services and Markets Act, the Association of British Insurers’ (ABI) Code of Practice on Non-Disclosure and the Insurance Conduct of Business Sourcebook (ICOBS) (2016). The Financial Ombudsman Scheme replaced the Insurance Ombudsman Bureau that insurers set up in 1981 and under which consumer disputes were resolved quickly and with minimum formality by an independent person through a framework that owed little to the MIA 1906, based on what was fair and reasonable in the circumstances of the case. The ABI's Code of Practice helped to reduce significantly the number of claims declined on grounds of non-disclosure and misrepresentation and ICOBS inter alia ensured that customers are treated fairly and given clear, fair and appropriate information about a policy in good time and in a comprehensive way so that they are able to make an informed decision about the arrangements proposed. See D Hertzell “Reforms to UK insurance law: Overview of key changes”, available at: <https://uk.practicallaw.thomsonreuters.com/6-615-6445?_…/> (last accessed 23 April 2019); ICOBS, available at: <http://www.fca.org.uk/firms/insurance-conduct-business-sourcebook-icobs/> (last accessed 23 April 2019).

8 Interpretation Act, cap I23 LFN 2004, sec 32.

9 (1869) L R Eq 368. See also Lee v British Law Insurance Co Ltd (1972) 2 Lloyd's Rep 49Google Scholar (where the court stated that full disclosure is of the essence of the contract); Tabs Assurance Ltd v Awuzie Industries (Nig) Ltd (1995) 4 NWLR (pt 388) 223 at 229Google Scholar; Irukwu and Others v Trinity Mills Insurance Brokers and Others (1997) 12 NWLR (pt 531) 117Google Scholar.

10 Mackenzie v Coulson, id at 375. See also Farwell, LJ in Re Bradley and Essex and Suffolk Accident Indemnity Society (1912) 1 KB 415 at 430Google Scholar; Jauncey, Lord in Banque Financière v Skandia (UK) Insurance Co Ltd (1990) 2 Lloyd's Rep 377 at 389Google Scholar.

11 Jessel MR in London Assurance v Mansel, above at note 4 at 369; Lindenau v Desborough (1828) 8 B&C 586 at 592Google Scholar. Secs 17–21 of the MIA 1906 formally codified the common law rules on disclosure and representation. These sections are re-enacted in Nigeria as secs 19–23 of the Marine Insurance Act 1961, cap M2, LFN 2004. Sec 17 of the MIA 1906, for example, provides that a contract of marine insurance is a contract based upon utmost good faith and, if either party does not observe utmost good faith, the other party may avoid the contract.

12 Lord Mansfield in Carter v Boehm, above at note 5 at 1905; Banque Financière de la Cité v Westgate Insurance Company Ltd (1987) 1 Lloyd's Rep 69Google Scholar; Steyn, J in Banque Keyser Ullmann SA v Skandia (UK) Insurance Co Ltd and Others (1987) 2 All ER 923Google Scholar; MIA 1906, secs 18(1) and 20(1).

13 Dalglish v Jarvie 2 Mac & G 231 at 243.

14 Romer, LJ in Seaton v Heath (1899) 1 QB 782 stated (at 793)Google Scholar that: “Contracts of insurance are generally matters of speculation, where the person desiring to be insured has the means of knowledge as to the risk, and the insurer has not the means or not the same means.” See also London General Omnibus Co Ltd v Holloway (1912) 2 KB 72Google Scholar; Joel v Law Union & Crown Insurance Co Ltd (1908) 2 KB 863Google Scholar.

15 Carter v Boehm, above at note 5 at 1909. It has been held in subsequent cases that failure to observe the utmost good faith renders the contract voidable and not void. See, for example, Mackender v Feldia AG (1967) 2 QB 590Google Scholar; National Insurance Corporation of Nigeria v Power and Industrial Engineering Ltd (1986) 1 NWLR (pt 14) 1Google Scholar.

16 Dalglish v Jarvie, above at note 13 at 243; London General Omnibus v Holloway, above at note 14.

17 Northern Assurance Co Ltd v Idugboe (1966) 1 All NLR 88Google Scholar.

18 Irukwu, J Fundamentals of Insurance Law (2007, Witherbys Printing) at 93Google Scholar.

19 (1815) 6 Taunt 338.

20 Above at note 14.

21 London Assurance v Mansel, above at note 4.

22 Carter v Boehm, above at note 5 at 1911; Bates v Hewitt (1867) 2 QB 595 at 605Google Scholar.

23 Foley v Tabor (1862) 2 F&F 778Google Scholar.

24 Bates v Hewitt, above at note 22.

25 Mann Macneal and Steeves Ltd v Capital and Counties Insurance Co Ltd (1921) 2 KB 300Google Scholar; Noble v Kennoway (1780) 2 Dong 510 at 512Google Scholar.

26 Carter v Boehm, above at note 5 at 1910.

27 Hair v Prudential Assurance Co Ltd (1983) 2 Lloyd's Rep 667 at 673Google Scholar; Roselodge v Castle (1966) 2 Lloyd's LR 113. MIA 1906Google Scholar, sec 18(1) requires the assured to disclose to the insurer, before the contract is concluded, every material circumstance that is known to the assured and the assured shall be deemed to know every circumstance that, in the ordinary course of business, ought to be known by him. However, in the absence of inquiry, sec 18(3) absolves the proposer from disclosing any circumstance that diminishes the risk, known or presumed to be known to the insurer, including matters of common notoriety or knowledge and matters that an insurer in the ordinary course of business, as such, ought to know. Also, the assured need not disclose any circumstance as to which information is waived by the insurer or that it is superfluous to disclose by reason of any express or implied warranty.

28 Shade, LJ in Banque Financière v Westgate Ins Co (1989) All ER 952 at 990 CAGoogle Scholar; approved by the House of Lords in (1990) 2 All ER 947 at 950 HL.

29 Above at note 10.

30 Lord Mansfield in Carter v Boehm, above at note 5.

31 Lord Jauncey in Banque Financière v Scandia, above at note 10 at 389.

32 (2001) 2 WLR 170.

33 Black King Shipping Corporation v Massie, “Litsion Pride” (1985) 1 Lloyd's Rep 437Google Scholar. In Bank of Nova Scotia v Hellenic Mutual War Risks Association, “Good Luck” (1988) 1 Lloyd's Rep 514Google Scholar, Hobhouse J in the court of first instance stated (at 545–46) that: “the obligation of utmost good faith is one which arises normally in relation to the making of the contract. This is because that is the situation in which the duty is most usually relevant. But, as stated by Hirst J in “Litsion Pride”, the duty exists throughout the contract.”

34 Lambert v Co-operative Insurance Society Ltd (1975) 2 Lloyd's Rep 485Google Scholar; Heart of Oak Building Society v Law Union and Rock Insurance Co Ltd (1936) 2 All ER 619Google Scholar. In Nigeria, most policies, other than life assurance policies, are for just one year and renewable annually.

35 Yerokun, O Insurance Law in Nigeria (2013, Princeton Publishing Co) at 205Google Scholar.

36 (1858) 1 F & F 276 at 279.

37 (1866) 4 F & F 905.

38 Id at 909.

39 (1999) Lloyd's Rep 209.

40 See also “Litsion Pride”, above at note 33 and “Good Luck”, above at note 33.

41 (1968) 1 ALR Comm 29.

42 It was held in Locker and Woolf Ltd v Western Australian Insurance Co Ltd (1936) 1 KB 408Google Scholar that the definition of “material” circumstance in the MIA 1906 is applicable to all forms of insurance. See also Mustill, Lord in Pan Atlantic Insurance Co Ltd v Pine Top Insurance (1995) 1 AC 501 at 588–619Google Scholar.

43 (1967) 3 ALR Comm 264.

44 Id at 279. See also United Nigeria Insurance Co Ltd v Salawu Karimu (1969) NCLR 247 at 250.

45 (1974) 1 NSWLR 228 at 239.

46 (1982) 2 Lloyd's Rep 178.

47 Above at note 42. It was also held in St Paul's Fire and Marine Insurance Co (UK) Ltd v McConnell Dowell Constructors Ltd (1995) 2 Lloyd's Rep 116Google Scholar that it was sufficient that the non-disclosure was an inducement and that it was not necessary that it was “the” inducement.

48 Above at note 43.

49 Above at note 46.

50 Above at note 4.

51 Above at note 17. American International Insurance Co Ltd v Dike (1978) NCLR 408.

52 Above at note 27. Lambert v Cooperative Insurance Society, above at note 34.

53 (1885) 15 QB 368.

54 (1973) 3 UILR (pt 4) 418. See also Holmes v Cornhill Insurance Co (1949) 82 LTL Rep at 575Google Scholar.

55 In contrast to the strict posture of the courts in determining the discharge of the duty of disclosure in non-marine cases, the courts seem to have adopted a more flexible approach in determining issues of non-disclosure in marine insurance cases. For example, in Lebon & Co v Straits Insurance Co (1894) 10 Times LR 517Google Scholar, it was stated (at 518) that, in marine insurance, issues of previous refusal or the rate of premium to be charged are not material facts that the proposer is bound to disclose. What are considered as material facts in marine insurance are those relating to the nature of the risk and not those relating to the judgment of other people. See also Glasgow Assurance Corporation v Symondson & Co (1911) 16 Com Cas 109 at 119Google Scholar; Mann Macneal & Steeves v Capital and Counties Insurance Co Ltd (1921) 2 KB 300Google Scholar; Beckwith v Sydebotham (1807) 1 Camp 116Google Scholar; and Fort v Lee (1811) 3 Taunt 38Google Scholar. It is remarkable that, in these cases, disclosure was held unnecessary, even though, in all of them, the circumstances appear to be material and known to the assured at the time of making the contract.

56 Santer v Poland (1924) 19 LTL Rep 29Google Scholar. Also, in a burglary proposal, it was held in Glicksman v Lancashire and General Assurance Company Ltd (1925) 2 KB 593Google Scholar that the position and the condition of the premises in which the articles to be insured are contained is necessarily a very material fact.

57 Heart of Oak v Law Union and Rock, above at note 34 at 620.

58 Above at note 14 at 884. In Economides v Commercial Union Assurance Co Plc (1998) 1 QB 587Google Scholar, it was also held that a private individual has to disclose only the facts that are known to him. Accordingly, provided that he did not wilfully shut his eyes to the truth, the only obligation is that of honesty and there is no requirement to inquire further into the facts.

59 (1960) 2 All NLR 317.

60 Above at note 43.

61 MIA 1906, sec 33(1) defines a warranty as “a promissory warranty, that is to say, a warranty by which the assured undertakes that some particular thing shall or shall not be done, or that some condition shall be fulfilled, or whereby he affirms or negatives the existence of a particular state of facts”.

62 Ngillari v NICON (1998) 8 NWLR (pt 561) 1Google Scholar.

63 (1834) 2 Cr & M 348.

64 Also, in Anderson v Fitzgerald (1859) 4 HLC 484Google Scholar, it was held that the basis of the contract clause removed any question of materiality from consideration by the jury.

65 (1976) 11 SC 295.

66 Lord, Green MR in Zurich General Accident and Liability Insurance Co Ltd v Morrison (1942) 2 KB 53 at 57–58Google Scholar. It has been argued in some quarters that the basis of contract clause was originally introduced with the purpose of drawing the attention of the applicants for insurance to the fact that the information required of them was very important: Hasson, R “The doctrine of uberrimae fidei in insurance law: A critical evaluation” (1969) 32/6 Modern Law Review 615CrossRefGoogle Scholar.

67 Above at note 43.

68 Id at 279–80.

69 (1922) AC 423. In Horne v Poland (1922) 2 KB 364Google Scholar, the failure of the insured to disclose that he was of alien birth and that he entered the contract under an assumed name was held to vitiate the contract.

70 Sirius International Insurance Corp v Oriental Assurance Corp (1999) 1 All ER 699Google Scholar.

71 Above at note 11.

72 (1912) 28 TLR 188.

73 (1956) 2 Lloyd's LR 240.

74 Ibid.

75 Newsholme Brothers v Road Transport and General Insurance Co Ltd (1929) 2 KB 356Google Scholar.

76 (1978) 10–12 CCHCJ 215; Iwuola v Express Insurance Co Ltd (1976) 2 CCHCJ 275Google Scholar.

77 Agomo, C “The problem of insurance claims in Nigeria” in Sagay, I and Oluyide, O (eds) Current Developments in Nigerian Commercial Law (1998, Throne of Grace) 230 at 233Google Scholar.

78 Above at note 17. American International Insurance v Dike, above at note 51.

79 This unfortunate decision was critically reviewed in Olawoyin, G “Northern Nigeria Assurance Co Ltd v Idugboe: The penalty for illiteracy” (1973) 11 Nigeria Bar Journal 81Google Scholar.

80 (1892) 2 QB 534; Holdsworth v Lancashire and Yorkshire Insurance Co (1907) 23 Times LR 521Google Scholar; and Thornton-Smith v Motor Union Insurance Co (1913) 30 Times LR 139Google Scholar. Also, in Golding v Royal London Auxiliary Insurance Co (1914) 30 Times LR 350Google Scholar and Ayrey v British Legal and United Provident Assurance Co (1918) 1 KB 136Google Scholar, disclosure of the true facts to the respective insurance company's agent was held to bind the insurance company, although the answers were incorrectly stated on the proposal form.

81 In respect of marine insurance, where insurance is effected for the assured by an agent, sec 19(b) of the MIA 1906 requires the agent to disclose to the insurer every material circumstance that the assured is bound to disclose, unless it comes to the knowledge of the latter too late to be communicated it to the agent.

82 Evidence Act 2011 (Nigeria), sec 136; Chukwura v Royal Exchange Assurance (Nig) Ltd (1974) ECSLR 319.

83 (2004) 2 WLR 531.

84 Mackender v Feldia, above at note 15; London Assurance v Mansel, above at note 4. MIA 1906, sec 18(1) also gives the insurer the right to avoid the contract where the assured fails to make the necessary disclosure.

85 London General Omnibus v Holloway, above at note 14.

86 (1972) NCLR 270.

87 Above at note 44.

88 (1937) 58 Lloyd's Rep 27 at 31, per Mackinnon J.

89 See also American International Insurance v Dike, above at note 51; National Insurance v Power and Industrial Engineering, above at note 15.

90 Feise v Parkinson (1912) 4 Taunt 640Google Scholar. Also, in Banque Keyser Ullmann v Skandia, above at note 12, Steyn J held that the insured's remedy for a breach of utmost good faith is avoidance of a contract and a return of the premium. Also, in Banque Financière v Westgate, above at note 12, it was held that, in the light of secs 17 and 18 of the MIA 1906, the only remedy that the act provides is that the aggrieved party can avoid the contract. The right to claim damages was dismissed.

91 In Irukwu v Trinity Mills, above at note 9, it was held, inter alia, that the principle of uberrimae fidei is still applicable in Nigerian insurance law.

92 A valid and binding contract of non-marine insurance can be concluded orally so long as it is clear by the ordinary rules and inference of law that there is an intention to enter into the contract and as long as all the fundamental essentials of the contract are present: Ngillari v NICON, above at note 62; Salako v Lombard, above at note 76; Esewe v Asiemo (1976) 1 ALR Comm 388Google Scholar. It ought to be noted, however, that in practice it is very rare for insurance contracts to be concluded orally without the use of a proposal form. Moreover, these forms are included in the documents that must be submitted to and approved by the National Insurance Commission under sec 6(1)(d) of the Nigerian Act, as part of the application to register as an insurer.

93 A survey conducted by UNESCO showed that, despite improvements in the country's education system, about 65 million Nigerians remain illiterate. This translates to just over 50% of the Nigerian population: M Bakare “65 million Nigerians are illiterates: UNESCO” (17 December 2015) The Vanguard (Nigeria), available at: <www.vanguardngr.com/2015/12/65-million-nigerians-are-illiterates-unesco/> (last accessed 23 April 2019). An illiterate was judicially defined in Ntiashagwo v Amodu (1959) WRNLR 273 at 277, as “a person who is unable to read with understanding and to express his thoughts by writing in the language used in the document made or prepared on his behalf”. Also, in PZ & Co Ltd v Gusau & Kantoma (1961) NRNLR 1, an illiterate was defined (at 3) as a person who is unable to read the document in question in the language in which it was written and includes a person who, though not totally illiterate, is not sufficiently literate to read and understand the contents of the document.

94 See also Hasson “The doctrine of uberrimae fidei”, above at note 66, arguing inter alia that the insurer is in a stronger position since he alone decides which information, out of the mass in the proposer's possession, is relevant to the conclusion of the insurance contract.

95 Jessel MR in London Assurance v Mansel, above at note 4 at 369; Lindenau v Desborough, above at note 11 at 592.

96 (1998) Lloyd's Rep IRI 151 at 154.

97 Ibid.

98 CIDRA, sec 2(4) and 2(5)(a) and (b) specifically made the common law rules on utmost good faith, as well as sec 17 of the MIA 1906, subject to its provisions.

99 UK Act, sec 1 defines a non-consumer insurance contract as a contract of insurance that is not a consumer insurance contract, ie all business-related insurance policies.

100 CIDRA, sec 2(3).

101 Id, sec 3(3).

102 Id, sec 3(4) and (5).

103 Id, sec 3(1) and (2). Id, sched 2 provides rules to determine the status of an agent. Under para 3, an agent is taken to act on behalf of the consumer where, for example, the agent undertakes to give impartial advice to the consumer or is paid a fee by the consumer.

104 Id, sec 4(2) and (5). A qualifying misrepresentation is deliberate or reckless if the consumer knew that it was untrue or misleading, or did not care whether or not it was untrue or misleading, and also knew that the matter to which the misrepresentation related was relevant to the insurer, or did not care whether or not it was relevant. On the other hand, a qualifying misrepresentation is careless if it is not deliberate or reckless.

105 MIA 1906, sec 17; London Assurance v Mansel, above at note 4.

106 CIDRA, sec 5(4).

107 Id, sched 1, para 1.

108 Id, sched 1, part I, para 5.

109 Id, para 6.

110 Id, para 7.

111 Id, para 9.

112 Id, sched I, part 2.

113 UK Act, sec 2(1).

114 Id, sec 7(1).

115 Id, sec 3(4). Circumstance is defined under id, sec 7(2) to include any communication made to, or information received by, the insured.

116 Id, sec 3(3).

117 MIA 1906, sec 18(3).

118 UK Act, sec 4(2).

119 Id, sec 4(2) and (3). “Senior management” is defined in id, sec 4(8)(c) as those individuals who play significant roles in the making of decisions about how the insured's activities are to be managed or organized.

120 MIA 1906, sec 18(1).

121 It has been argued in some quarters that this requirement for a “reasonable search” potentially imposes a far more onerous obligation on the insured compared to the common law rule of knowledge possessed by the insured in the ordinary course of its business. See TaylorWessing “Fundamental changes to insurance contract law: The Insurance Act 2015” (January 2016), available at: <https://united-kingdom.taylorwessing.com/en/fundamental-changes-to-insurance-contract-law-the-insurance-act-2015> (last accessed 23 April 2019).

122 UK Act, sec 4(4).

123 Id, sec 5(3).

124 Id, sec 6.

125 Id, sec 7(4).

126 Id, sec 8(3) and (4).

127 Id, sec 8(5). A qualifying breach is deliberate or reckless if the insured knew that it was in breach of the duty of fair representation, or did not care whether or not it was in breach of that duty.

128 Id, sched 1, para 2.

129 Id, para 4.

130 Id, para 5.

131 Id, para 6.

132 See generally id, sched 1, part 2.

133 Id, sched 1, part 2, para 8.

134 Id, sched 1, part 3, para 12.

135 CIDRA, sec 3(1) and (2). Also, sec 22 of the Canberra Insurance Contracts Act 1984 (Act No 8) (as amended) imposes a duty on the insurer to inform the insured clearly in writing, before the contract of insurance is entered into, of the general nature and effect of the duty of disclosure. Any insurer who fails to discharge this duty may not exercise its rights in respect of a failure by the insured to comply with the duty of disclosure, unless that failure is fraudulent. Sec 22 of the Insurance Contracts Act 1984 (as amended) (Australia) contains similar provisions.

136 CIDRA, sec 3(3); Insurance Contracts Act, 1984 (as amended) (Australia), sec 21(1)(b). Roselodge v Castle, above at note 27.

137 For example, the UK Rehabilitation of Offenders Act, 1974 relieves the assured from disclosing spent offences. Similarly, convictions for mere dishonesty or old convictions are not required to be disclosed. In North Star Shipping Ltd v Sphere Drake Insurance Plc (2006) 2 Lloyd's Rep 183 at 189Google Scholar, Waller LJ reiterated the fact that spent convictions no longer have to be disclosed, neither do old allegations of dishonesty or allegations of not very serious dishonesty. Also, in Reynolds v Phoenix (1978) 2 Lloyd's Rep 440Google Scholar, the judge rejected the underwriter's expert evidence and agreed with the insured's expert that the fact that the assured had been convicted in 1961 of receiving two stolen tractor batteries worth between GBP 10 and GBP 12, for which he was fined GBP 250 was too trivial and too distant to be material. The conviction had been 11 years before a policy against fire was taken out.

138 This provision is contained in sec 21(3) of the Insurance Contracts Act, 1984 (as amended) (Australia). Indeed, under sec 27 of this act, a proposer is not taken to have made a misrepresentation by reason only that he failed to answer a question included in a proposal form or gave an obviously incomplete answer to such a question.

139 For example, in Joel v Law Union and Crown Insurance, above at note 14, many of the questions the assured was asked related to matters of health, the answers to which could only be matter of opinion, even if given by a medical expert. Akpata v African Alliance, above at note 43.

140 CIDRA, sec 3(1) and (2)(c). Also, the Insurance Contracts Act, 1984 (as amended) (Australia), sec 23 provides that, where a statement is made in answer to a question asked in an insurance proposal and a reasonable person in the circumstances would have understood the question to have the meaning that the person answering the question apparently understood it to have, that meaning shall, in relation to the person who made the statement, be deemed to be the meaning of the question. See also Insurance Act, 2006, Act 724 (Ghana), sec 214(3)(f).

141 (1970) ALR Comm 27.

142 See also Bawden v London, Edinburgh and Glasgow Assurance, above at note 80.

143 CIDRA, sched 2.

144 (1929) 2 KB 356.

145 Indeed, under the general law of contract, the plea of scriptum predictum non est factum suum [the signature on the deed was not his own] is not available to a contracting party who, because he is too busy or lazy, fails to scrutinize a document before appending his signature: Blay v Pullard & Morris (1930) 1 KB 628Google Scholar; Awosile v Sotubo (1992) 5 NWLR (pt 243) 514Google Scholar.

146 See, for example, the House of Lords decision in Pan Atlantic v Pine Top, above at note 42; Fraser Shipping Ltd v Colton (1997) 1 Lloyd's Rep 586Google Scholar.

147 See generally, CIDRA, sched 1, part 1 and UK Act, sched 1; Insurance Contracts Act, 1984 (as amended) (Australia), sec 28. Indeed, under sec 31 of the Australian act, in any proceedings by the insured in respect of a contract of insurance that has been avoided on the ground of fraudulent failure to comply with the duty of disclosure or fraudulent misrepresentation, the court is empowered, if it is of the opinion that (in respect of the loss that is the subject of proceedings before the court) the insurer has not been prejudiced by the failure or misrepresentation or, if the insurer has been so prejudiced, the prejudice is minimal or insignificant, to disregard the avoidance; if the court does disregard the avoidance, the court may allow the insured to recover the whole (or such part as the court thinks just and equitable in the circumstances) of the amount that would have been payable if the contract had not been avoided. Furthermore, the court, in the exercise of this power, is enjoined to have regard to the need to deter fraudulent conduct in relation to insurance, and also to weigh the extent of the insured's culpability in the fraudulent conduct against the magnitude of the loss that the insured would suffer if the avoidance were not disregarded.

148 Above at note 54.

149 See, for example, Dawson v Bonnin, above at note 69.