Harris v. Poland (1941) All ER 204
FACTS-
- The plaintiff resides in a flat in London and took out a comprehensive insurance policy with Lloyds in January 1939, covering loss by fire, burglary, housebreaking, and other causes.
- Following an attempted burglary during the summer, the plaintiff became concerned about the safety of her jewellery while the flat was empty.
- On December 2, she wrapped jewellery and banknotes totalling over £100 in a newspaper and hid them in the fireplace amongst the coalite.
- Forgetting about the hidden items, she later lit a fire, causing the hidden parcel to be destroyed by fire.
- The plaintiff seeks to recover the loss of £460 from the underwriters of insurance.
ISSUE-
- Whether the loss incurred by the plaintiff, due to the destruction of the hidden items by fire, falls within the coverage of the insurance policy.
RULE-
- If the ignition is caused to the insured property which was not intended to be ignited then the claimant can claim the insured amount.
HELD-
- The court is tasked with interpreting the language of the insurance policy, specifically the phrase "loss or damage occasioned by fire." The plaintiff argues that this phrase should cover any damage caused by the ignition of insured property, even if the fire occurs in a place where fire is intended to be, such as a fireplace or a stove.
- The court outlines several principles of interpretation:
- The court must consider the ordinary meaning of the words used in the policy.
- Any ambiguity in the policy must be interpreted in favour of the insured.
- The court should not imply additional stipulations in the contract unless it's necessary based on a reasonable interpretation of the terms.
- If a policy is reasonably susceptible to two constructions, the one more favourable to the insured should be adopted.
- In both the following cases, the court ruled against the plaintiff because there was no actual ignition of any substance other than what was intended to be fuel for the fire
- Austin v. Drewe (1816) 4 Camp. 360: This case involved an action on a policy of insurance against fire. The premises insured were used as a manufactory for sugar baking. The court considered whether the damage caused by smoke, sparks, and heat from a stove used in the manufactory, without actually burning any property, constituted a loss within the policy.
- Everett v. London Assurance (1865) 19 CBNS 126: In this case, the plaintiff sought to claim on a policy of insurance against fire for damage caused by an explosion about a quarter of a mile away from the insured premises. The court examined whether this damage fell within the scope of the insurance policy.
- The court establishes a test for determining liability under the insurance policy: The true test is whether there has been an ignition of the insured property that was not intended to be ignited.
- If the insured property is damaged as a direct consequence of the ignition of other property not intended to be ignited, then the loss is considered to be caused by fire.
- Based on the interpretation of the policy terms and the established test of liability, the court rules in favour of the plaintiff, stating that they are entitled to succeed in their claim under the insurance policy.
COMMENTARIES RATIO/NOTE-
- 26.19 The meaning of “Fire” in policy and fire loss
26.19.1 Property not intended to be ignited
Fire is an element as much indispensable as earth, water and air. It is necessary for cooking, lighting, etc. In American phraseology, this is a friendly fire as opposed to a hostile fire. Hence, fire lighted for a definite purpose and fulfilling that purpose is not fire within the policy, that is, damage caused by its heat is not lost by fire within the policy. If, however, the fire breaks its bounds and by throwing out sparks or otherwise causes ignition, that is burning to take place outside the grate or furnace, there is a loss by fire within the meaning of the contract [Upjohn v Hitchins, 119 LT 180].