CIV/T/406/02
IN THE HIGH COURT OF LESOTHO
HELD AT MASERU
In the matter between:
LESOTHO NATIONAL GENERAL INSURANCE - PLAINTIFF
VRS
ALFA PLANT HIRE - 1ST DEFENDANT
MASIA MAKARA - 2nd DEFENDANT
JUDGMENT
Delivered by the Honourable Mr Justice W.C.M. Maqutu on the 15lh August 2005
Right of insurer to claim reimbursement -failure by defendants to supply particulars of passengers in their vehicle - Sections 15 and 17 Motor Vehicle Insurance Order 1989 reimbursement claim by insurer -passenger being of the other vehicle involved in collision with defendants' vehicle - exception - whether insurer acting in terms of sections 15 and 17 of Motor Vehicle Insurance Order - whether summons and declaration disclose cause of action in the circumstances.
In this case after the defendant had pleaded, they excepted to plaintiffs claim. This exception is the following:
That the plaintiffs Declaration does not disclose a cause of action for the following reasons;
Section 17 does not oblige defendants to report about injury or death of people who are not occupants of their own cars. They are only obliged to report about persons within the cars they are driving.
ALTERNATIVELY
The declaration does not disclose whether the Defendants knew about the said deaths and/ or injury or not.
Section A provides for disclosure of addresses and names if known.
The plaintiffs declaration that is being excepted to is the following:
DECLARATION
-1-
Plaintiff is LESOTHO NATIONAL GENERAL INSURANCE COMPANY LIMITED, a company with limited liability duly registered and incorporated in terms of the Laws of the Kingdom of Lesotho with its registered head office and carrying on business at Lesotho National House, Kingsway, Maseru, Lesotho.
-2-
The first defendant is ALFA PLANT HIRE, a firm carrying on business as such at Pitso Grounds in the District of Maseru, with postal address P.O. Box 2503, Maseru, whose full and further particulars are to the plaintiff unknown.
2
-3-
The second defendant is MASIA MAKARA, a major male Lesotho citizen and driver of Maseru employed by the first defendant at its address at Pitso Grounds, whose full and further particulars are to the plaintiff unknown.
-4-
On the about the 20th June, 1999 an accident occurred along the Main North One road at or near Matukeng in the district of Leribe when a vehicle with registration letters and numbers J 0037, driven by the second defendant acting within the course and scope of his employment with the first defendant, collided with a vehicle with registration letter and numbers C0217 in which vehicle MAKABAI LETSIPA, 'MATUMO RAKAUONE, FICKAS PUTSOANE, THORA SEMELA, JOSEPH MOHANOE, LINEO MOETI and TEBEHO NTS'IHLELE were all passengers and of which vehicle MOOJANE LETHOBA was the driver.
-5-
As a result of the aforementioned collision, the said MAKABAI LETSIPA. 'MATUMO RAKAUONE, JOSEPH MOHANOE, and MOOJANE LETHOBA sustained
serious bodily injuries and lodged claims with the plaintiff in terms of the Motor Vehicle Insurance Order, 26 of 1989, as amended, for compensation. In addition, the said FICKAS PUTSOANE, LINEO, MOETI, TEBOHO NTS'IHLELE and THORA SEMELA also sustained serious bodily injuries, and their being minors, MAFICKAS PUTSOANE, LOPE MOETI, MATEBOHO NTS'IHLELE and LERATA SEMELA respectively lodged claims with the plaintiff on their behalf in terms of the Motor Vehicle Insurance Order, No. 26 of 1986, as amended, for compensation.
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-6-
At all relevant times hereto, the plaintiff was the registered insurer of vehicle J 0037 in terms of the provisions of the Motor Vehicle Insurance Order, 26 of 1989, as amended.
-7-
The said collision was caused by the negligence of the second defendant in the driving of the said motor vehicle.
-8-
In terms of the provisions of the Motor Vehicle Insurance Order, 26 of 1989, as amended, the plaintiff was legally obliged to pay and did pay the sum of M138, 915.00 to the claimants.
-9-
In terms of Section 17 of the said Order, the first defendant, as owner of vehicle J0037 and the second defendant as driver thereof were obliged to inform the plaintiff as insurer of the said vehicle of the occurrence and of the place and time of the occurrence and also the name and address ( if known) of any person who was killed or injured and of every person who was upon the vehicle in question at the time of the occurrence, with a description of any other vehicle involved in the occurrence with the name and address (if known) of the driver of every such other vehicle and on any other person who witnessed the occurrence and with any other reasonable information at their disposal within fourteen (14) days of the said collision, if reasonably possible, but failed or neglected to do so.
-10-
In terms of Section 15 (2) (c) of the Motor Vehicle Insurance Order, 26 of 1989, as amended, the plaintiff is therefore entitled to recover from the defendants as owner and driver of the insured vehicle, the amount paid by the plaintiff to the said
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MAKABAI LETSIPA,'MATUMO RAKAUONE, JOSEPH MOHANOE, and MOOJANE LETHOBA and to MAFICKAS PUTSOANE on behalf of FICKAS PUTSOANE, LOPE MOETI on behalf of LINEO MOETI, MATEBOHO NTS'IHLELE on behalf of TEBOHO NTS'IHLELE and LERATASEEMA on behalf of TORA SEEMA.
-11-
Despite demand, defendants have failed and/or refused and /or neglected to pay to plaintiff the amount claimed.
-12-
WHEREFORE plaintiff prays for judgment against the defendants jointly and severally, the one paying the other to be absolved, for:
12.1 Payment of the amount of M138, 915.50.
12.2 Interest on the aforesaid amount at the rate of 18,5 % per annum a tempore morae;
12.3 Costs of suit;
12.4 Further and/ or alternative relief. Plaintiffs claim is based on the following sections:
Right of recourse by insurer
15. (1) When the insurer has paid any compensation in terms of this Order in may subject to the provisions of subsections (2) and (3) without having obtained a formal cession of the right of action, recover from the owner of the motor vehicle in question, or from any person whose negligence or other unlawful act caused the loss of damage in question, so much of the amount paid by way of compensation as the third party mentioned in this Order could, but for the provisions of section unlawful
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act caused the loss or damage, as the case may be, if the insurer has not paid any such compensation.
(2) The insurer shall not have any such right of recourse against the owner of the motor vehicle.
(a) in any case in which, at the time of the
occurrence which gave rise to the person
other than the owner, unless –
(i) the said person was under the
influence of intoxicating liquor or of
a drug to such a degree that his
condition was the sole cause of the
said occurrence, and the owner the
a drug; or
(ii) the said person was driving the motor vehicle without holding a licence issued under the law relating to the licensing of drivers of Motor vehicles, which he was required to hold, or the said person, being the holder of a learners or other restricted licence issued under such law, failed, while he was driving the motor vehicle to comply with the requirements or conditions of such learners or restricted licence and the owner allowed him to drive the motor vehicle knowing that he did not hold such licence or that he failed to comply with the requirements or conditions of such learners or restricted licence, as the case may be:
(b) in any case in which, at the time of the said occurrence, the said motor vehicle was being driven by the owner, unless –
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(i) he was under the influence of intoxicating liquor or of a drug to such a degree that his condition was the sole cause of said
occurrence; or
(ii) he was driving the motor vehicle without holding a licence issued under the law relating to the licensing of drivers of motor
vehicles or being the holder of a learners or other restricted licence issued under such law, failed while he was driving the motor
vehicle to comply with the requirements or conditions of such learners or restricted licence; or
(c) in any case in which neither paragraph (a) nor paragraph (b) applies unless the owner had failed to inform the said insurer in writing of the occurrence and of the place and time thereof, within fourteen days after the occurrence, the onus of proving that the insurer could not reasonably within fourteen days after the occurrence have been informed of the occurrence and of the place and time thereof, being on the owner concerned, or has knowingly furnished the said insurer with false information relating to the said occurrence.
(3) The above mentioned provisions shall apply mutatis mutandis in respect of any right of recourse by the said insurer under sub-section (1) against any person who, at the time of the occurrence which gave rise to the payment of the compensation, was driving the motor vehicle with the consent of its owner.
Giving information of accident to insurer and Third party
(17) When, as the result of the driving of a registered motor vehicle, any person other than the driver of
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the motor vehicle has been killed or injured, the owner of the driver, if he is not the owner, of the registered motor vehicle shall (if reasonably possible), within fourteen days after the occurrence furnish the insurer on the prescribed form of the occurrence and of the place and time of the occurrence and shall furnish it with the name and address (if known) of any person who was killed or injured and of every person who was upon the vehicle in question time of the occurrence, with a description of any vehicle involved in the occurrence with the name and address (if known) of the driver of every such other vehicle and of any other person who witnessed the occurrence and with any other reasonable information at his disposal in regard to the occurrence with the insurer may from time to time request him to furnish.
The first question that came to my mind was whether the legislature intended to indemnify plaintiff for the loss it incurred in paying out, the claims to the victims of the motor vehicles collision. When I raised this issue Mr Loubsher for plaintiff instantly said that was the intention of the legislature. The reason being that as De Villiers JP in Union Guarantee Insurance Co Ltd v Portgieter 1959 (3) SA 881 at 882 H:
"It is obvious that it is of utmost importance to the insurer to be informed of the fact, time and place of the occurrence at the earliest possible moment after it happened to enable it to discover the cause thereof and obtain evidence of marks and possible witnesses etc."
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In short if I understood Mr Loubsher's argument well, the legislature intended to punish the owner or driver of the motor vehicle that failed to notify the insurer of the collision by making him refund the monies paid out to victims as damages regardless of which vehicle they occupied. In the past notification was to be within reasonable time, now the legislature has shortened it to 14 days.
Mr Matooane for the defendants who are the excepients argued that the Act was intended to insure passengers who are third parties in each and every vehicle that was involved in a collision. If I understood Mr Matooane well - the legislature intended to insure every driver and motor vehicle owner against third party claims made by or on behalf of the passengers who happen to be in the motor vehicle or others for whom the driver is directly responsible. The right of recourse against the owner or driver of the vehicle negligently responsible for the collision remains, but is not covered by sections 15 and 17 of the Motor Vehicle Insurance Order of 1989. It is for that reason that comprehensive insurance is a necessary precaution.
If Mr Matooane is right then each driver is obliged under Act to report the injuries of its passengers. There is an obligation to report injuries or death of
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third parties in the other car that was involved in the collision only if the driver in question knows them. In other words according to Mr Matooane sections \5 and 17 of the Motor Vehicle Insurance Order 1989 are not geared towards the reporting of deaths and injuries of third parties generally. Furthermore the indemnification ( by the owner or driver of the vehicle) of insurance companies that have paid out claims because of the negligence of owners and drivers of motor vehicles is limited to failure to report the accident in respect of death and injuries of the driver's passengers - not of the other vehicle.
A portion of section 17 is geared towards the driver, owner and passengers of the specific insured motor vehicle as Mr Matooane has correctly argued. But the second part of section 17 provides further that the owner or driver:
"...shall furnish it ... with a description of any other vehicle involved in the occurrence with the name and address ( if known, or the driver of every other vehicle and of any person who witness the occurrence and with any other reasonable information at his disposal in regard to the occurrence which the insurer may from time to time request him to furnish."
It is this portion that Mr Matooane does not emphasise - but which Mr Loubsher regards as the back-bone of plaintiff's claim.
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I asked both counsels for decided cases on third party claims based on the same facts. Both counsels said there were none. I found this unusual and directed both counsel to look harder. After hearing them I ask for further written submissions that might assist the court.
In response to my request Mr Loubsher filed further written submissions and referred me to the case of Union Guarantee and Insurance Co Ltd v Portgieter 1959 (3) SA 881. In that case the driver who was concussed had failed to inform the insurer of the collision. The insurer met the damages for injuries received by the driver of the other car and brought an action for the recovery of that amount from the driver who did not inform the insurer of collision. De Villiers JP at page 883 F (in finding the owner of the other vehicle liable to refund the insurer under a similar section) said:
"It would have been the simplest matter for defendant to have asked one of the nurses at the hospital to telephone plaintiff and convey to it three simple most essential facts namely, the collision, the place where and the time when.
It is on the basis of this case that Mr Loubsher argues that Mr Matooane's submission that section 17 does not cover the other motor vehicle cannot be correct. The issue is in my view not simple. The question still arises -whether the legislature's intention was limited to the obligation to convey to the insurer "three simple most essential facts, namely, the collision, the place
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where and the time when" as De Villiers JP says in Union Guarantee and Insurance Co (Pty) Ltd v Portgieter. Section 17 seems to require an ongoing obligation to exchange information. It puts the insurer under an obligation to be in contact with the owner and driver of the vehicle to continuously find information and evidence. It does not imply that merely because he insurer was not informed of the collision, the insurer should not contact the drivers or owner of the vehicle even after the insurer has come to know of the collision.
In Lickiss v Milestone Motor Policies at Lloyd [1966] 2 A11ER 972 Lord Denning in the English Court of Appeal was not impressed with an insurer's repudiation of liability based on the vehicle owner's failure to inform it of an accident. The reason was simply that the insurer had learned of the particulars from the police. To put this in Lord Dennings words at page 975 G of Lickiss v Milestone Motor Policies at Lloyd:
"I take a different view from the County Court judge for two reasons. First it was unnecessary for the Motor cyclist to send the documents to the insurers. They had all the relevant facts, and that absolved the motor cyclist from doing more... Seeing that they had received the information from the police, it would be a futile thing to require the motor cyclist himself to give them the self-same information. The law never compels a person to do what is useless."
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Could it be that up to now there has not been such a case in Lesotho, as one before me for the same reason? Could it no not be that the legislature was alive to the fact that since the driver of the other car would supply the information in respect of his passengers - there was no reason to involve the defendants in the other car's third party compulsorily insured passengers?
If that is not so, then it would be important for the plaintiff in its declaration to disclose whether or not the defendants knew about those deaths and /or injuries of the occupants of the other motor vehicle timeously. But as Section 17 does not put defendants under an obligation to report, therefore this would not advance the plaintiffs claim in any way. Nevertheless the alternative to plaintiff main exception has something in it. If defendants knew that plaintiff already knew about the deaths or injuries in the passengers of the other motor vehicle, Lord Denning in Lickiss v Milestone Motor Policies at Lloyd said "it would be a futile thing to require" the defendants "to give them the self - same information. The law never compels a person to do what is useless and unnecessary." Such an interpretation of a statute makes sense particularly where a statute is silent on the issue.
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The case of Springbok Timber & Hardware Co (Pty) Ltd v National Employers' Mutual General Insurance Co Ltd 1970 (1) SA 346 does not help because the passenger involved (and who was the claimant) was the appellant's passenger. In this case plaintiff (as insurer) claims reimbursement for passenger of another car. Even so, the Appellate Division applied the Section 22 (1) which is similar to Lesotho's Section 15 read with Section 17 strictly. I note that the pleadings in this case differ substantially from the above case and there are admissions in this case where none existed in the case above.
In Union Guarantee & Insurance Co Ltd v Portgieter 1959 (3) SA 881 the reimbursement that is claimed is in respect to passengers of the other motor vehicle not those of the insured. The facts in Union Guarantee Insurance co Ltd v Portgieter are in many respects similar to the case before me. The difference being the legislature has provided greater guarantees in the legislation that third party victims of motor collisions will be compensated.
De Villiers JP in Union Guarantee Insurance Co Ltd v Portgieters avoided interpreting or emphasizing the first portion of the section which deals with names of occupants. He noted that the other information which must also
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be given in terms of section 22(1) does not fall under the qualification of 'as soon as may be' see Union Guarantee & Insurance Co Ltd v Portgieter page 882 F. It would seem therefore in terms of section 77 the owner and the driver in due cause shall furnish the insurer:
"... with a description of any other vehicle involved in the occurrence with the name and address (if known) of the driver of every such other vehicle and of any other person who witnessed the occurrence and with any other regard to the occurrence which the registered company may from time to time request him to furnish."
It seems to me that supplying "three simple and most essential facts, namely, the collision, the place where and the time when" which De Villiers JP at page 883 F has in mind goes with the occupants of the insured vehicle rather than the other vehicle. Consequently I do not agree with De Villiers JP that the legislature had in mind the other vehicle, when it entitled the insurer to reimbursement. If that was the intention the legislature should have said so unequivocally.
It is a dangerous oversimplification to hold that the insurer should be reimbursed without having to prove any prejudice. Therefore I do not think the legislature intended that failure to inform the insurer (who already knew of the collision) should be penalized so heavily. I also take the view that the Order expected the insurer to contact the defendants on an ongoing basis to
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combat allegations of negligence. In fact section 17 makes this plain in its wording.
When I looked at the Motor Vehicle Insurance Order No.26 of 1989. I came across sections 3,4, 5, 6 and 7 which provide:
Motor vehicle insurance levy on fuel
(3) (1) The Minister may impose a motor vehicle insurance levy on fuel and the levy shall be of such amount as he may, by notice in the Gazette, determine.
(2) Every person who imports fuel from any place outside Lesotho shall pay the levy imposed under subsection (1) at the time of such importation or at such other time, either before or after such importation, as the Minister may prescribe.
Purpose of insurance levy
4. (1) The levy collected under section 3 shall become public moneys and shall be used for the purpose of compensating any person
whomsoever (in this Order called the third party) for any loss or damage referred to under section 6.
(2) Notwithstanding subsection (1) the levy collected under section 3 shall also apply in respect of loss or damage resulting from or arising out of the driving of a motor vehicle registered in Lesotho in such other place outside Lesotho as the Minister may prescribe.
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Administration of levy
5. (1) The Minister may enter into an agreement or make such other arrangement with any insurer for the purpose of administering and managing the levy. (2) The minister shall by notice given not later than three months before the first day of January in each year publish in the Gazette the name of the insurer with whom he has entered into an agreement or other arrangement under subsection (1).
Liability of insurer
6. (1) The insurer shall be obliged to compensate any person for any loss or damage with the third party has suffered as a result of-
any bodily injury to himself;
the death of or any bodily injury to any person;
in either case caused by or arising out of the driving of a registered motor vehicle by any person in Lesotho, if the injury or
death is due to the negligence or other unlawful act of the person who drove the registered motor vehicle or of the owner or his servant in the execution of his duty. (2) Notwithstanding subsection (1) the insurer shall also be obliged to make good under this section any loss or damage resulting from or arising out of the driving of a motor vehicle registered in Lesotho in such other place outside Lesotho as the Minister may prescribe.
Lapse of insurer's liability
7. (1) The insurer's liability in terms of the Order shall lapse on the expiration of the current insurance period.
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Where the liability of an insurer has lapsed in terms of subsection (1) the Minister shall give notice in the Gazette showing the date upon which such liability lapsed.
Notwithstanding subsections (1) and (2), the insurer shall still be liable for all claims arising out of his Order where such claims occurred before the date upon which liability lapsed.
I felt counsel on both sides have not adequately addressed me on the Act I therefore directed counsel on both sides to submit written argument reconciling Sections 15 and 17 with the above sections.
It is important to note that compulsory third party insurance business is not treated like other insurance business. See Gordon & Getz the South African Law of Insurance 4th Edition at page 22. As Kumleben J in Stegen & Others v Shield Insurance Co Ltd 1976 (2) SA 176 at page 176 to 177 dealing with the suggestion that compulsory. Third party insurance is like any other insurance said:
"The fallacy in this submission lies in its premise that this statutory enactment in similar to, or should be compared with, a contract of insurance. It in fact has few, if any, of the characteristics of a consensual bargain. The owner, if not exempted,
is obliged to insure if the motor vehicle is to be used on a public road (sec. 2 (1)). Once it has been insured the owner and the
registered insurance company are not entitled to vary or cancel the "agreement." The legal consequences of such insurance are governed by the provisions of the Act and not by terms mutually agreed upon between the insurer and
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the insured. In fact it would be more accurate to say that the only real resemblance it bears to a contract of insurance is that one of its objects is in a sense indemnification. The answer of the question raised in this exception thus depends upon the correct interpretation of sec 21 unfettered by any comparison with the characteristics of a contract or of an insurance contract.
This being the case we have to interprete section 15 and 17 of the Motor Insurance Order No.26 by finding their meaning within the scheme of that Order as a whole and not by reference to the general principles of the law of insurance. In this way intention of the legislature will be determined.
Before going into the merits of this exception, the starting point is what the legislature prescribed under section 6 (1) of Motor Vehicle Insurance Order No.26 which is similar to section 21 of the compulsory Motor Vehicle Insurance Act of 1972. In Evins v Shield Insurance Co Ltd 1980 (2) SA 814 Corbett JA was interpreting the purpose of the Act. Some benefits conferred by the Act are for a third party who may be injured or killed by the insured vehicle, other benefits are intended for both the insurer and the third party in whose favour the legislature had decreed an insurance. The legislature has also prescribed benefits for the insurer accompanied by drastic penalties for non-compliance for the inconvenience caused to the insurer by the driver or owner of the vehicle. Among these are prescriptions
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for delays in filing claims. Against drivers and owners of motor vehicles in which third parties die or got injured by some negligence or unlawful act -but who fail to notify the insurer of their particulars, the insurer may recover the damages paid out to third
parties in terms of the Act. This is what sections 15 ad 17 of the Motor Vehicle Insurance Order No.26 of 1989 deal with.
Corbett JA in Evins v Shield Insurance Co Ltd at page 830 and 831 deals with prescription - but what he said might help us understand what the legislature had in mind.
In favour of the third party Corbett JA at page 830 G of Evins v Shield Insurance Co Ltd above said:
"Section 21 itself obliges an authorized insurer which has insured or is deemed under the Act to have insured a motor vehicle to compensate any person (known as the "third party") for any loss or damage which the third party has suffered as a result of-
In favour of the insurer Corbett JA at page 831 CE Corbett JA said:
"It has been held by this court that S 25 was enacted mainly for the benefit of authorized insurers and that the purpose of the section is to ensure that before being sued for compensation an authorized insurer will be informed of sufficient particulars about the claim and will be given sufficient time to be able to consider the claim and decide whether to resist, settle or compromise it before any costs litigation are incurred (see Nkisiname and Others v Santam Insurance Co Ltd 1978 (2) SA
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430 (A) at 434F-G and the cases there cited). It was further held in Nkisimane 's case supra at 434 H that the requirement in sec 25 to the effect that a claim must be submitted to the authorized insurer before the commencement of legal proceedings is peremptory and requires exact compliance; otherwise the purpose of the section will be frustrated. In regard, however, to the contents of the claim form (which S 25 (1) requires to be set out in the manner prescribed by the regulations) the Court held (in Nkisimane's case at 435 A-G) that this requirement is directory and that substantial compliance therewith is both necessary and sufficient."
It seems to me clear that within the Order there are inbuilt checks and balances. It deals harshly with those who delay in submitting third party claims through a strictly enforced prescription of claims. What Mr Matooane poses as a question/which court must answer, is whether section 15 and 17 make each driver or owner responsible for reporting the third party victims in his or her car together with their particulars - or do they oblige him or her also to report the third party victims in the other insured Motor vehicle involved in the Collision? If the words themselves in the sections do not necessarily admit of such an interpretation - then should failure to report the collision by itself attract for the driver or the owner of any vehicle liability to reimburse an insurer if he should fail to report the collision?
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It seems to me clear that section 15 and 17 indemnify the owner and his driver against third party claim from passengers in their vehicle because in terms of the Order, it is assumed by the authorized insurer. If they should fail to report to the authorized insurer the collision and the particulars of the deceased or the injured traveling in their motor vehicle, the owner of the motor vehicle or the driver lose that indemnity - consequently the insurance company has a right to claim reimbursement for payment in damages made to those third parties. Nevertheless the third party does not suffer - the insurer still pays because the intention of the legislature was that the third party should not fail to be compensated merely because the driver or owner of the vehicle have no means to pay the damages.
The idea behind the compulsory third party motor vehicle insurance is to create a jus quaesitum tertio. Wilkinson and Wilson in Gloag and Henderson's Introduction to the Law of Scotland 9th Edition 10.4 at page 113 say:
"Jus quaesitum Tertio. - the rule that the contracting parties alone have the right to enforce their contract suffers exception in cases where it is shown that their object was to advance the interests of a third party. That may create a jus quaesitum tertio,
which will give the third party, or a tertius, a title to sue. In order to make this possible the tertius, or a particular class of which he is a member, must be named or referred to in the contract."
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In modern times with the Motor Vehicle Insurance Order 1989 the State has gone further, it has created a fund out of which Third Party claims resulting from the negligence of drivers will be settled. In other words each registered motor-vehicle is automatically insured against third party claims in respect of bodily injury and death caused by the negligence of the driver of each and every motor vehicle in Lesotho today. Consequently it is no more correct to say that third party insurance to the extent covered by the Motor Vehicle Insurance Order 1989 "involves the three parties, the insurer, the assured and the third parties" as Lord Wright observed in Digby v General Accident Fire and Life assurance Corporation Ltd 1943 AC 121 at page 139, it has become a special insurance whose terms and conditions are governed by statute.
Cases involving the owner of the car claiming as a third party because of the negligence of his own driver have in the past presented problems. See the cased Home v Newport - Gwilt & Another 1961 (3) SA 342 and Stegen v Shield Insurance Co Ltd 1976 (2) SA 175. The Order has excluded the owner and the driver of the car in Sections 15 and 17, it becomes difficult to introduce them as the legislature has excluded them. It seems as if the legislature in those sections deals with claims in respect of each individual
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car. If the occupants of the other insured car were the target of sections 15 and 17 of the Order of 1989, then the legislature should have said so.
Section 15 of the Interpretation Act of 1977 puts courts under an obligation to avoid interpreting statutes in a manner that reduces them to absurdity. Courts therefore have to interprete laws in a manner that is remedial and with an objective to achieve the objects of the law under consideration. The law has made in it mandatory to report road traffic accidents and collisions.
Consequently section 88(1) read with section 88 (2) of the Road Traffic Act No.8 of 1981 prescribe heaving penalties for people who fail to report such collisions and accidents involving motor vehicles. Because of the penal natured of section 15 read with section 17 of the Motor Vehicle Insurance Order of 1989, it has to be strictly interpreted and limited to what it covers expressly.
In Read v Avon Insurance Co Ltd 1967 (1) SA 379 Beadle CJ at page 383 DE speaks of "General policy" and "statutory policy" in respect of motor vehicle insurance. It would seems the Motor vehicle Insurance Order of 1989 in which the legislature established a fund to compensate passengers
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and victims of negligent driving of motor vehicle, contains the legislature's policy within it. The legislature even established a fund to which every litre of petrol or diesel bought for motor vehicles automatically includes a contribution into the fund for
compensating these victims. Section 15 read with section 17 of the Motor Vehicle Insurance Order of 1989 is a penal section, which seeks to punish the defendant who has paid his premiums by making him - later to pay those damages he ought to be indemnified by the approved insurer had he reported the particulars of his injured or deceased passengers. Consequently this section has to be strictly interpreted.
Nevertheless care should be taken not to defeat the objects of the Act because in terms of section 15 of the Interpretation Act of 1977:
"Every enactment shall be deemed remedial, and shall be given such fair, large and liberal construction and interpretation as best ensures the attainment of its objects."
The provisions of the Motor Vehicle Insurance Order 1972 whose place has been taken by the Motor Vehicle Insurance Order 1989 have always been strictly enforce as they stand by the courts in Lesotho and in the Republic of South Africa. In Lesotho Insurance Company v T. Sekhesa 1995 - 96 LLR & Lesotho Bulletin 1 the Court of Appeal strictly enforced the provisions of the Order in favour of the insurance company. In that case the claimant had
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issued summons within the 60 days the insurance company is given to respond to the claim. The claimant had done this in order to avoid the two years prescription of the claim that was imminent. The Court of Appeal held that the action was unenforceable. It could only be enforceable if served after the prescribed 60 days. However as they were served again after the two years from the date of the collision the claim had prescribes in respect of the adult claimants - but not in respect of the children.
The aforementioned judgment in Lesotho National Insurance Company v T Sekhesa is grounded on South African decisions. If the third party insurance statutes in both Lesotho and the Republic of South Africa are strictly applied in the protection of the rights of the insurance company in the enforcement of its 60 days time to deliberate in respect of insurance claims - and prescription of claims - the same strictness has to be applied in respect of right of the insured and claimants towards the insurance companies. In other words State Policy should not favour the powerful insurance companies against the little man. That would go against the values of our State Policy found in section 25 of Chapter III of the Constitution.
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Both counsel could find no authority (except Union Guarantee Insurance Co Ltd v Portgieter above) in which courts in South Africa had dealt with such a case - and upheld - a claim from an insurer for reimbursement from the driver or owner in respect of passengers in the other insured car, merely because the driver had not reported the particulars of injured strictly. Each vehicle has its own insurance - whose premiums had been deducted in advance in the petrol of diesel levy of each car. What has to happen in terms of Section 15 and 17 of the Motor Vehicle Insurance Order 1989 is clearly spelt out. I take the view that in Union Guarantee Insurance Co Ltd v Portgieter the issues were not fully canvassed. Both counsels made wrongly assumptions. Consequently that case was wrongly decided.
If the intention of the legislature was to ensure to compliance with the provisions of the Order to ensure the settlement of third party claims, the courts should not go beyond this. It has to be born in mind that each motor vehicle is individually covered and in the past the insurer would have repudiated liability (to the prejudice of a third party) because of the driver's or motor vehicle's owner's non-compliance, thereby making owner and the driver personally liable. The intention of the legislature is not to enrich an unprejudiced insurer or to punish the owner or driver of the insured vehicle –
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merely because he did not provide the information that the insurer already had. See remarks of Lord Denning in the above-mentioned case of Lickiss v Milestone Motor Policies at Lloyd.
The parties in this matter should go to the statutory roots, they should not use the provisions of the statute for the purposes for which they were not intended. Only the insurer of the excipients' motor vehicle has such a right of recourse in terms of those sections for damages paid in respect of occupants of the excipients' motor vehicle.
Defendants' exception is upheld with costs.
W.C.M MAQUTU
JUDGE
For Plaintiff : Mr Loubsher
For Defendant : Mr Matooane
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