CHINA PING AN INSURANCE (HONG KONG) CO LTD v. CHIU CHI YUNG

HCMP178/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 178 OF 2011

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J U D G M E N T

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1.  In this matter, the plaintiff seeks two declarations which relate to a policy of insurance entered into between the plaintiff and the insured defendant.  The declarations that are sought are, firstly, that the plaintiff is entitled to avoid the policy of insurance for reasons which I shall go into in a moment, and also for a declaration that the plaintiff is not liable to indemnify the defendant under the policy in respect of a road traffic accident that occurred on 16 March 2010 at Tin Shui Road, Tin Shui Wai, New Territories.

2.  This seems to me was a cynical and deliberate fraud practised by the defendant on the plaintiff.  The facts that I need to record are these. The defendant was the owner of a Honda Accord motor car, registration number NX 2391.  On 29 July 2009, with a view to obtaining insurance cover for the vehicle, he signed a motor insurance proposal form. 

3.  That proposal form contained a number of plain falsehoods.  First of all, the defendant said that he was 30 years old, that his occupation was in IT which I assume means “information technology”, and something relating to perhaps the computer industry, and that he had been driving regularly for over 10 years.  In order to support the application, he presented a copy of his Hong Kong identity card which purported to show that he was born on 2 July 1979.  So what he was representing was that he was over 30 years old.

4.  As a result of that, the plaintiff was persuaded to offer him cover for him to drive that vehicle.

5.  Now, on 16 March 2010, whilst that policy was in effect, the defendant collided with a bicycle ridden by a Mr Chow Kwai-yuen.  The police were called.  They investigated the matter, and the defendant was charged with careless driving. He did not report the accident to the plaintiff, his insurers.  They first heard of this matter some seven months later on or shortly after 8 October 2010 when the Legal Aid Department wrote to them arising out of this accident. They of course investigated the matter, as a result of which they discovered the following four lies that were contained in the insurance proposal form.

6.  Firstly, the defendant’s true date of birth was 2 July 1989, so he was only 20 years old, not 30 as he had said in his proposal form.  He had been licensed to drive only since October 2008, so rather than being someone who had driven regularly for over 10 years, in fact he had only been driving for about six months.

7.  Next, it appeared that he was not in fact working in the field of information technology, he worked as an air-conditioning technician between 2006 to July 2010, and the significance of this is that it is the policy of the plaintiff not to offer insurance to a number of excluded of occupations and professions including persons in the Defendant’s occupation, presumably on the basis that persons involved in such occupations might have a higher risk of making claims on their policy.  And so that was also a material falsehood.  And lastly, he had not revealed to the plaintiff that he had applied to another insurance company for an insurance policy, and that he had been declined cover due to his young age and inexperience. 

8.  As a result of finding out all of this and, unsurprisingly, the plaintiff has taken out this originating summons for the declarations that it now seeks.  I am satisfied that the defendant has been served with these proceedings at every stage.  He does not appear today and he is not represented because he has chosen not to be, so there is no difficulty about service.

9.  What is important so far as the plaintiff is concerned - and this is why they seek the declarations - are matters that are raised in section 10(1), 10(3) and 10(5) of the Motor Vehicles Insurance (Third Party Risks) Ordinance. 

10.  The effect of the declarations, if I were to make them, is that, first of all, they would have successfully avoided the insurance policy and that is only right where they had been deceived by these highly material misrepresentations made to them in the proposal form by the defendant.  But the other matter - and this is really what is particularly important - is the second of these two declarations which would entitle them to avoid having to indemnify the defendant in respect of the claim by the unfortunate cyclist that was knocked down by the defendant on 16 March 2010. In respect of these matters, I have absolutely no doubt that this is the correct course for me to take, and I will make the declarations sought together with an order for costs against the defendant.