Carter v Dawson

• Jurisdiction: Cayman Islands
• Judge: (Orr, Ag. J.)
• Judgment Date: 20 November 1997
• Court: Grand Court (Cayman Islands)
• Date: 20 November 1997

Grand Court

(Orr, Ag. J.)

CARTER (as Administratrix of the estate of D.V. Carter, deceased)

and

DAWSON (D.A.), DAWSON (A.B.) and DAWSON (F.M.)

R.D. Alberga, Q.C. and A.J. Taylor for the plaintiff;

C.H. Allen for the second defendant;

Ms. S.J. Collins for the applicant, British Caymanian Insurance Co. Ltd.

Cases cited:

(1) Carpenter v. Ebblewhite, [1939] 1 K.B. 347; [1938] 4 All E.R 41, distinguished.

(2) Fire, Auto & Marine Ins. Co. Ltd. v. Greene, [1964] 2 Q.B. 687; [1964] 2 All E.R. 761, not followed.

(3) Gurtner v. Circuit, [1968] 2 Q.B. 587; [1968] 1 All E.R. 328, followed.

(4) Murfin v. Ashbridge, [1941] 1 All E.R. 231, distinguished.

Legislation construed:

Grand Court Rules, O.15, r.6(2):

‘Subject to the provisions of this rule, at any stage of the proceedings in any cause or matter the Court may on such terms as it thinks just and either of its own motion or on application-

…

(b) order any of the following persons to be added as a party, namely-

(i) any person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon….’

Road Traffic-insurance-third party risks-joinder of insurer-insurer challenging validity of policy under Motor Vehicle Insurance (Third Party Risks) Law, 1990, s.15(3) in parallel proceedings may be joined in proceedings against insured on issue of quantum only, since will be liable if challenge fails

The applicant insurance company applied to be joined as a defendant in the plaintiff”s action on behalf of her late husband”s estate to recover damages for his death, caused by the first defendant”s negligent driving.

The applicant denied involvement in the issue of liability and commenced separate proceedings against the second defendant as the insured (and also the first defendant”s mother), seeking a declaration that the insurance policy was invalid. The plaintiff in the present proceedings was also joined as a defendant in that action, which was yet undetermined.

The appellant now sought to be joined in the present proceedings on the issue of the quantum of damages only. It submitted that (a) natural justice required that it be joined under the Grand Court Rules, O.15, r.6(2), since quantum was a matter which could not be effectually and completely determined and adjudicated upon in its absence; and (b) since it was unable to exercise its right of subrogation to defend the proceedings on behalf of the first defendant because it denied liability, it should be treated by the court as if it had no such contractual right.

The plaintiff administratrix submitted in reply that (a) an insurance company could not be joined as a party in an action in which its insured was a defendant other than in exceptional circumstances, and in this case the applicant”s presence was not necessary for the proper assessment of damages; and (b) since the applicant had chosen not to exercise its right under the policy to take over the conduct of the defence, it should not now be allowed to do so on the issue of quantum only, unless it also accepted liability to indemnify the first defendant against judgment in favour of the plaintiff.

Held, ordering that the applicant be joined as a defendant on the issue of quantum alone:

The applicant, if it were unsuccessful in its action to obtain a declaration as to the invalidity of the insurance policy, would be liable to

indemnify the defendants for damages assessed in these proceedings. Accordingly, natural justice required that it should be permitted to be heard on the issue of the quantum of those damages. The applicant had properly declined to exercise its right of subrogation in the light of its position on the invalidity of the policy, but would be joined in the court”s discretion under the Grand Court Rules, O.15, r.6(2) (page 490, lines 40–43; page 492, lines 39–43).

ORR, Ag. J.: At the hearing for the assessment of damages on October
35	28th, 1997 there were two applications before me which I granted. I
promised to put my reasons in writing. I now fulfil that promise.
The applications were:
1. That British Caymanian Insurance Co. Ltd. be joined as a fourth
defendant to the action pursuant to O.15, r.6 of the Grand Court Rules,
40	limited to involvement on the issue of quantum of damages.
2. An application on behalf of the second defendant that the hearing be
adjourned.
The history of the matter is relevant. The plaintiff brought the action in
her capacity as administratrix of the estate of her husband who died as a
45	result of a motor vehicle collision in which the first defendant was the

driver. The first defendant is the son of the second defendant who, it is
claimed, was the owner of the motor car at the material time and had
effected a policy of insurance on the said motor car with British
Caymanian Insurance Co. Ltd. The third defendant is the registered
5	owner of the motor car. The statement of claim alleges that the first
defendant was driving with the knowledge and consent of the second and
third defendants.

...