At
the close of the plaintiff's case, in a relatively short trial, the defendant's
counsel applied for absolution from the instance plus costs of suit on a legal
practitioner and client scale.
The
plaintiff issued summons claiming a sum of US$1,315=, interest at the
prescribed rate on the principal sum from the date of the accident to the date
of final payment, collection commission at the rate of 30% plus costs of suit.
At the commencement of the trial, the plaintiff had sought not to lead any
evidence on the assumption that there were no triable issues. This is despite
the fact that at the pre-trial conference he agreed that the issues to be
referred to trial were those outlined in the defendant's pre-trial conference
minute. In any event, there was no way the plaintiff could have sought to prove
the claim for damages without going to trial.
The
issues referred to trial were as follows -
1.
Whether or not the plaintiff has locus standi to sue the defendant.
2.
Liability.
3.
Quantum.
4.
Whether or not Cell Insurance Company paid out the sum of US$1,315= to the
insured.
5.
Whether or not the plaintiff is entitled to collection costs, and, if so, at
what scale/rate.
The
plaintiff testified that on 29November 2009, a Toyota Hiace motor vehicle, with
registration number ABJ4615 was involved in an accident. The motor vehicle
belonged to Vhungu Rural District Council. The accident was caused by the
defendant's negligence in that he failed to keep a proper lookout and drove
without due care and attention. As a result, the motor vehicle was extensively
damaged and had to undergo repairs. The costs of repairs amounted to US$1,315=.
The insurers of Vhungu Rural District Council indemnified it in the sum of US$1,170=.
The
defendant paid a deposit fine.
The
plaintiff further testified that he operates a debt collection company called
Jacynth and Associates. He did not explain whether it is incorporated. Cell
Insurance entered into a cession agreement which resulted in the plaintiff
taking over the claim against the defendant. It must be noted that the
plaintiff did not seek to produce any documentary evidence like the Deed of Cession,
the assessor's report and the quotations from the vehicle repairers. It seems
the plaintiff was relying on the assumption that the documents already form
part of the record by virtue of the Discovery Schedule. This is largely
attributable to the plaintiff's misconception of the law as will become
apparent when I deal with the application for absolution.
In
seeking absolution from the instance, counsel for the defendant submitted that
the plaintiff lacks locus standi.
Citing
SUSAN SCOTT in the The Law of Cession, second edition, he submitted that there
was no subrogation as claimed by the plaintiff. Thus, if there had been
subrogation the present proceedings would have been instituted in the insured's
name. In addition, if the insured had ceded its rights to Cell Insurance, the
latter would have been able to sue the defendant in its name. However, evidence
should have been led that there was cession of the claim from the insured to
the insurer.
On
the other hand, the plaintiff submitted that since Vhungu Rural District
Council did not cede its right of action to Cell Insurance, the latter were
entitled to recover what they paid out in indemnifying Vhungu Rural District
Council from the defendant on the basis of the principle of subrogation. He
made reference to The South African Law of Insurance by GORDON&GETZ….,.
On
the other hand,GORDON&GETZ in The South African Law of Insurance, fourth
edition state…, -
“Subrogation
means the substitution of one person for another so that the person substituted
or subrogated succeeds to the rights of the person whose place he takes. It
expresses the insurer's right to be placed in the insured's position so as to
be entitled to the advantage of all the latter's rights and remedies against
third parties.”
The
same authors state that there are two procedures by which an insurer may seek
to recover damages attributable to a third party. In the absence of a formal
assignment of the right of action by the insured, the insurer who has paid out
the loss must sue the third party in the insured's name. In the absence of
subrogation, the insured must cede all rights of action against a third party
to the insurer in which case the insurer sues the third party in its name.
Applying
the above principles, it is evident in the present case that there was no
subrogation. If there was subrogation, the present action would have been in
the name of Vhungu Rural District Council. On the other hand, it has not been
shown that Vhungu Rural District Council ceded its right of action against the
defendant to the plaintiff. It is immaterial that Cell Insurance purported to
cede its right of action to the plaintiff.
As
counsel for the defendant submitted, Cell Insurance could not cede rights it
did not have…..,.
It
therefore follows that a court applying its mind reasonably to the evidence
lead before this court might not find for the plaintiff.
In
the result it is ordered that -
(a) Absolution from the instance be and is
hereby granted.
