Peterson et Al v Caribbean General Insurance Ltd

• Jurisdiction: Montserrat
• Court: High Court (Montserrat)
• Judge: Georges, J.
• Judgment Date: 29 July 1991
• Neutral Citation: MS 1991 HC 3
• Docket Number: 48 of 1991
• Date: 29 July 1991

Peterson et al

and

Caribbean General Insurance Limited

Georges, J.

48 of 1991

High Court

Insurance — Claim — Arbitration clause — Claim for cost of repairing dwelling house following destruction by Hurricane Hugo in 1989 — Condition 9 of the Policy of Insurance invoked — Award of arbitrator to be obtained before a right of action or award — Scott v. Avery clause — Liability was not the issue — Question to be resolved was quantum of damages — Precisely the situation envisaged by Condition 9 of Policy of Insurance — Plaintiff summons dismissed.

Appearances:

Mr. Jean E.H. Kelsick for the Plaintiffs.

Mr. Samuel. N. Barzey for the Defendant.

IN CHAMBERS

Georges, J.

1 By a specially indorsed writ dated 11th April, 1991 the plaintiffs herein claim against the defendant insurer the sum of $97,906.00 as the cost of repairing a dwelling house following damage/destruction by Hurricane Hugo in September 1989, plus a further amount of $83,00.00 in respect of the contents of the said house which it is alleged were a total loss.

2 In its defence the defendant company relies on Condition 9 of the Policy of Insurance which inter alia provides that:

3 “If any difference arises as to the amount of any loss or demand, such difference shall independently of all ether questions be referred the decision of an arbitrator to be appointed in writing by the parties in difference…… within two calender months after having been required so to do in writing by the other party.”

4 This said Condition further states that:

5 “It is hereby expressly stipulated and declared that it shall be a condition precedent to any right of action or suit upon this Policy that the award by such arbitrator, arbitrator or umpire of the amount: of loss or damage, if disputed, shall be first obtained.”

6 This clause is commonly known as a Scott v. Avery clause, whereby the making of an award is considered as a condition precedent to any right of action in respect of any matters agreed between parties to a contract. As a general rule, such a clause, quite apart from any right to stay proceedings, constitutes a defence to any proceedings brought before the award has been determined.

7 By summons dated 5th June 1991 Solicitor for the plaintiffs seeks a declaration that that provision of the policy of insurance should cease to have effect on the ground that the dispute which has arisen between the parties under the agreement involves the question whether...