Maye v Colonial Mutual Life Assurance Society Ltd [1924] HCA 26 - HCA 1924 case summary — Zoe

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Maye v Colonial Mutual Life Assurance Society Ltd [1924] HCA 26

[1924] HCA 26

High Court of Australia|1924-07-01|Before: Starke JJ, Rich J, Starke J, Per Starke J, Shand J

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At a glance

Source facts

Court

High Court of Australia

Decision date

1924-07-01

Before

Starke JJ, Rich J, Starke J, Per Starke J, Shand J

Source

Original judgment source is linked above.

Judgment (184 paragraphs)

[1]

Life Assurance - Policy of assurance - Untrue answer to question in proposal - Condi-

[2]

tion for avoidance - INliterate proposer - Answers filled in by canvasser - Knowledge of untruth - No knowledge of proposer that untrue statement made - Principal and agent - Canvasser - Agent for proposer or for insurer - Misrepresentation - Fraud - Warranty.

[3]

A policy of assurance was issued by a life assurance society to M. The policy was founded on a proposal and declaration and a personal statement. The proposal consisted of answers given to questions on a printed form, and the declaration was a printed form, at the end of the questions and answers, stating that the proposer declared that to the best of his knowledge and belief the particulars were in all respects true. A condition of the policy provided that the society "'relies on the truth of the statements in the proposal, declaration and personal statement . . . and if the assurance hereby granted shall have been obtained through any fraudulent misrepresentation or concealment this policy shall be void and all moneys in respect hereof shall be forfeited to the society." M. was illiterate. A convasser of the society called upon him at his farm and suggested that he insure with it. M. said that another assurance society had "turned him down" as a first class life. Subsequently the canvasser saw M. in Brisbane, and requested him to visit the society's office and see the manager. M. did so, and proposed for assurance with the society. The manager instructed the canvasser to get the proposal form filled up and completed. The canvasser filled in the answers to the questions in the proposal form without reference to M. One of the questions

[62]

and conditions," it runs thus : - ' 1. Proposal and declaration and personal statement. - The Society relies on the truth of the statements made in the proposal and declaration and the personal statement made in connection with this assurance." It is said by the company that this clause, like the recital above referred to, insists on the absolute and literal truth of the answers in the proposal and that there is a tacit condition of such absolute and literal accuracy. Even if the clause stopped there, I should hesitate to hold so - and for this reason : the truth referred to is not simply the truth of the statements made in the answers found in the " proposal" but in the " proposal and declaration." If that document, which is headed "proposal and declaration" and is signed once and as a whole, there being no signature to the answers, be read apart from the declaration, it appears to me to be, not only the fairest, but the most reasonable construction that the words "the Society relies on the truth of the statements made in the proposal and declaration," mean the truth as stated in the declaration. That is, as before, the truth "to the best of my knowledge and belief." In Macdonald v. Law Union and Life Insurance Co. (1) Lush J. draws pointed attention to the significance of such a qualification. Cockburn C.J. (1) repeats the distinction; and, as I read the judgment of Blackburn J., that learned Judge was of the same opinion. (See, in Jones vy. Provincial Insurance Co. (2), the observations of Cresswell J.). If it be true, as Lord St. Leonards says in Anderson v. Fitegerald (3), that "a policy ought to be so framed, that he who runs can read," and if that learned Lord be right in what he says (4) as to "the man's knowledge,' then it does seem to me nothing short of a trap to ask a man to limit himself in that way, take his money, and then to disregard the limitation expressly inserted, without which, probably, many persons would refrain from definitely answering without qualification. It is as if every answer were prefaced with the words "to the best of my knowledge and belief."" It is also in the circumstances, as I shall indicate, something more, but for the present I defer that.

[109]

conducting business of the Society with Maye. Mr. Corbett said :

*' I was in the room part of the time whilst the proposal was being written out. I chatted to Mrs. Maye at the door. I was speaking to Rouse previously. I brought Rouse in and introduced him to Maye. Whilst I was in the room nobody said anything about a previous proposal to the Citizens' or any other company, or about his being turned down or deferred by Citizens' Co., or being examined by a doctor for insurance company or classed as second class by a doctor, or anything to indicate he had made a proposal to any other company or treated with any other company." But he does not say anything affirmative as to anything Maye said. In cross- examination he says: "I saw Willis asking Maye questions and writing on the proposal whilst I was talking to Mrs. Maye"; and, further on, he said of Maye: "I did not regard him as an educated man, he was not a man I would expect to write a letter; he gave no indication that he could not read nor that he could; he asked me to fill up the cheque." The relevant questions put to the jury and the answers they gave were as follows : - {The questions and answers were here set out]. The questions had been typed by direction of the learned Judge, and evidently submitted to counsel before placing them before the jury. Counsel for the respondent after the summing- up asked for a direction as to question 7, which was refused. He also suggested the following questions : - (1) " Did Maye deliver the document Ex. 2 to the defendant as a proposal for an insurance ? " Counsel for appellant thereupon admitted that after signing it Maye left it at the office and never had it in his possession again. Thereupon the learned Judge saw no necessity to put the question. (2) Question 16, which was put to the jury. (3) "Did defendant accept the proposal and issue the policy on the first of the statements made in Ex. 2 and the personal statements made by the doctor?" The learned Judge's notes say: "No evidence as to anybody having thought anything about it; I decline to put the question." (4) Question 17 and (5) Question 18; these were put with further directions. This having been the conduct of the case, I am of opinion that the parties are bound by it to the extent that, provided

[122]

place, there can be no doubt, and a dock company, I think, must - be taken to hold out their harbour-master, or the person who fills - that character for the moment, as possessing sufficient authority : to inform ships where they may safely ground. Apart therefore from the controversy who first suggested this operation, and - confining myself to the admitted fact that this thing was done by permission of Johns with such assurances of its being safe as induced - the captain to act upon them, I am of opinion that the company q would be responsible for the harbour-master's act and representations. I quote Jervis C.J. in Giles v. Taff Vale Railway Co. (1): "Tam of opinion that it is the duty of the company, carrying on a business, to leave upon the spot someone with authority to deal on behalf of - the company with all cases arising in the course of their traffic as the exigency of the case may demand.' In that case the Chief Justice was dealing with a railway and with the question whether planting quicks and giving directions in respect of them was an act within the authority of the general superintendent of the line, and it was agreed that the company was a railway company for carrying goods and not a market gardening company for the purpose of planting ' quicks.' But the reply was given in the words which I have quoted, and which I certainly adopt. The Chief Justice continues : 'I think he had authority, in the exigency of the traffic, to keep the quicks in the mode in which they were kept, and that consequently they were in the custody of the company in the course of their ordinary business.' So here, I think the grounding of the vessel in a place which it may be quite true was not in the original construction of the docks intended as a dry dock, but would, looking to the assurance from the person left in charge of the business of the dock company, be fit and appropriate for the purpose, would be an act which to my mind is neither abnormal nor extraordinary, if by those words it is intended to convey something outside anything that could be ordinarily and reasonably contemplated as part of the business which the dock company were carrying on." Lord Watson agrees with Lord Halsbury as well as with Lord Herschell, and the latter learned Lord deduces actual authority from the circumstances. Whether, therefore, it be correct to say that the (1) (1853) 2 E. & B. 822, at p. 829.

[126]

either simply acting as an amanuensis for and on behalf of Maye, or he was pro hac vice the living acting official of the abstraction called the Society, Maye, as I have pointed out, did not act by any agent. What he did in relation to the company he did personally. He gave the necessary and true information at some time or other ; he gave it to Willis when Willis approached him as canvasser for the company. I may interpose that, if Maye did not use the word " deferred," it is immaterial. The substance was told as set forth in par. 2 of the reply (in which it was stated that Maye had informed the company that he had previously entered into negotiations with the Mutual Life and Citizens' Assurance Co. for life assurance, that Dr, Dovaston had classed him as class 2, which Maye had refused to accept, and that the negotiations had not resulted in the issue of a policy). So the jury found. And, at least, Maye may well have thought he did and thereby state the substance of the matter. No question was asked as to this, and no suggestion was made that it was not in effect covered by the questions :put. Maye signed the proposal himself, he handed in the proposal himself at the company's office to the only person representing the company for that purpose. He is, therefore, responsible for what he did and for his own state of mind, and for that only. Willis, on the other hand, was the ear and hand of the company in writing the answers and taking the proposal, either with invested authority for the occasion or with its equivalent by holding out. The company received the proposal, not from Willis, but by Willis, who handed it to Corbett, his superior, without any direction from Maye; and all this to the knowledge and by the direction of Corbett, who, with full knowledge of the manner of doing the business, continued it and received the proponent's cheque. There was, to say the very least, abundance of material upon which the jury were at liberty to find as they did, that Willis was the agent of the company in filling in the answers to the questions.