Howie v. CGU Insurance Plc [2005] ScotCS CSOH_110 (17 August 2005)

Howie v. CGU Insurance Plc [2005] ScotCS CSOH_110 (17 August 2005)

The court held that the defenders' argument based on mutuality of obligations and Condition 3 of the policy was without merit, as insanity at the time of the fire did not amount to a relevant breach of contractual obligations or public policy that would preclude recovery. There was no averment of recklessness prior to insanity, and established authority supports recovery in such circumstances.

Citation
[2005] ScotCS CSOH_110
Parties
Pursuer: Ewen Moir Howie; Defenders: CGU Insurance Plc
Jurisdiction
Scotland
Judgment Date
17 August 2005
Procedural Posture
Commercial Action (insurance Claim) / Debate on Relevancy of Pleadings; Interlocutory Decision
Outcome
Defenders' averments on mutuality of obligations excluded from probation; defenders' fourth plea-in-law repelled; proof before answer allowed on remaining issues.
Legal Topics
Fire Insurance, Mutuality of Obligations, Insanity and Contractual Capacity, Public Policy in Insurance, Exclusion Clauses
Insurance Law Contract Law Mental Health Law Fire Insurance Mutuality of Obligations Insanity and Contractual Capacity Public Policy in Insurance Exclusion Clauses

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Parties

Ewen Moir Howie

Pursuer

CGU Insurance Plc

Defenders

Procedural Posture

Commercial Action (insurance Claim) / Debate on Relevancy of Pleadings; Interlocutory Decision

Legal Issues

  1. 1 Whether an insured who destroys insured property while insane is precluded from recovery under a fire insurance policy due to breach of contractual obligations or public policy
  2. 2 Whether the principle of mutuality of obligations in contract law relieves the insurer from liability when the insured becomes insane

Ratio Decidendi

The court held that the defenders' argument based on mutuality of obligations and Condition 3 of the policy was without merit, as insanity at the time of the fire did not amount to a relevant breach of contractual obligations or public policy that would preclude recovery. There was no averment of recklessness prior to insanity, and established authority supports recovery in such circumstances.

Court Disposition

Defenders' averments on mutuality of obligations excluded from probation; defenders' fourth plea-in-law repelled; proof before answer allowed on remaining issues.

Orders

  • Exclude from probation the averments of the defenders in Answer 4 beginning with 'Esto the Pursuer was insane' until 'as a matter of mutuality'.
  • Repel the defenders' fourth plea-in-law.