Ennia General Insurance Company Ltd Appellant v J. Astaphan & Company (1970) Ltd Respondent [ECSC]

JurisdictionCaribbean States
CourtEastern Caribbean Supreme Court
JudgeBISHOP, J.A:,MOE, J.A,SIR LASCELLES ROBOTHAM, C.J,.
Judgment Date06 May 1988
Judgment citation (vLex)[1988] ECSC J0208-1
Docket NumberCIVIL APPEALS: 8/84 & 16/84
[1988] ECSC J0208-1

IN THE COURT OF APPEAL

Before:

The Honourable Sir Lascelles Robotham — Chief Justice

The Honourable Mr. Justice Bishop

The Honourable Mr. Justice Moe

CIVIL APPEALS: 8/84 & 16/84

Between:
Ennia General Insurance Co. Ltd.
Appellant
and
J. Astaphan & Co. (1970) Ltd.
Respondent
Appearances:

H. DaCosta Q.C. and D. Scharschmidt, instructed by

Y. Bennett of Robinson, Phillips & Whitehorn, for the Appellant.

E. George Q.C. and J. Armour and A. Astaphan instructed by Armour, Armour & Harris, for the Respondent.

BISHOP, J.A:

On Wednesday, 29th August, 1979, hurricane David struck the island of Dominica. Winds of very high velocity, and torrential rain for more than 8 hours caused untold devastation over the entire island. People were killed or injured. Houses and other buildings were totally demolished or partly destroyed. The hospital was very badly damaged. The top floor of Government Headquarters building was damaged while the bottom floor was subsequently used as a relief centre for many months. Normally, it accommodated mainly administrative offices. Electricity and telephone lines and poles were torn down or uprooted. So too were trees of varying types and sizes.

For consecutive days over a two week period after the hurricane struck, it rained heavily and almost nonstop. Severe flooding made some areas inaccessible for days. Many parts of the island were without utility services for periods ranging from days to months. In Roseau, the capital of Dominica, electricity was only totally restored around March, 1981; and in other areas it took years longer.

Indeed, put briefly, there was such havoc as had not been seen on the entire island within living memory.

At the time, J. Astaphan & Co. (1970) Ltd., a company incorporated under the laws of Dominica, carried on business in the island. It owned and operated the Asta Hotel at Victoria Street, Roseau, a shopping complex of buildings at King George V Street, Roseau, and another complex of about 15 buildings at Fond Cole about 1 1/2 miles outside of Roseau. The last mentioned included a mattress factory, a motor vehicle garage, and many storage buildings. J. Astaphan & Co. (1970) Ltd., sometimes referred to herein as Astaphans, also acted as local representative for Ennia General Insurance Company Ltd., a company incorporated in the Kingdom of the Netherlands with registered office in The Hague and with a regional office in Barbados, carrying on the business of general insurers in many parts of the world, including the Caribbean islands.

In August, 1979, there were in force three policies of insurance made between Astaphans and Ennia General Insurance Company Ltd. One of these policies concerned coverage for loss of profits and had no significance in the instant appeal. The other policies, numbered 2619–023 and 2619–025, dated 9th August, 1971, each had about twenty endorsements. It was these policies that provided the substratum of a dispute between the contracting parties. It was admitted that in consideration of Astaphans paying certain premiums, Ennia General Insurance Company Ltd. agreed to insure and indemnify the said Astaphans in respect of its several properties and contents described in the policies and endorsements, against loss or damage by hurricane and riot — among other things. Ennia General Insurance Company Ltd., also called herein Ennia, or The Insurance Company, insured the buildings and contents at Victoria Street, King George V Street, and Fond Cole, up to the values stated in the respective policies and endorsements.

Astaphans property did not escape the fury of the hurricane, and it is important that descriptions given in the court below be remembered if a proper evaluation of all the facts and circumstances and a full appreciation of many of the submissions and arguments advanced before this Court are to be achieved. Therefore I shall recall some of the descriptions.

Austin Winston, secretary/accountant of Astaphans was in Dominica at the time of the hurricane. He said that their head office was totally destroyed, electronic accounting records were demolished and documents were water soaked. He found it difficult to describe the scene but nevertheless he told the Court below:—

"………. a great mess, water all over the place, ankle deep downstairs. We had teams of workers trying for weeks to get the water out……. Invoices and other records were all upstairs, all affected by the hurricane, soaked, scattered. As a result………. I was not in a position to use them afterwards. The electronic accounting machines were all damaged……soaked and couldn't work."

He explained that after the hurricane members of staff attended work late or irregularly as they were pre-occupied with their own personal problems.

As far as the hotel was concerned, he said:—

"The top floor went completely and the first floor was leaning and had to be demolished."

Indeed, since the hurricane the building was unfit for use as a hotel and was used only for storage.

About the third location Winston said:—

"From the following day and days after there was looting of the company's property at Fond Cole. It was boisterous looting. I went there with some difficulty. Things quieted down and I went there one week later. I saw practical total destruction of the buildings and whatever contents therein, including vehicles……

Under cross-examination the witness explained that the situation remained chaotic until about June, 1980. Several employees had to share one desk, and papers were moved around "all the time". No proper or adequate stationery or receipt books were available. In the witness' view:—

"There was destruction, disorientation and abandonment, chaos. It was very taxing living on the island……. There was utter chaos ………difficult and trying time."

Foned Issa, Managing Director of Astaphans for ten to fifteen years testified:—

"Hurricane David near totally destroyed Roseau. It did tremendous damage as well in the south of the island. Most of the people were made homeless……. several people killed….. many were injured. It rained profusely for days and weeks after……..

Foued Issa also described the supermarket site as he saw it on the 30th August, 1979. Among other things, the entire roof was destroyed, the offices were totally destroyed. Records, files and stationery were "all over the top floor, soaking wet; strewn all over the place, yard and streets". The entire bottom floor was under water with goods lying soaked in the water. Most of the glass windows were broken and people were running in and out of the building.

Issa's description of the hotel was to the effect that its top floor was totally damaged and leaning, and the ground floor was covered by or had water.

Roger Charles Schwab, an insurance loss adjuster visited each of the locations. He said, in part;—

"…….. At Asta and Fond Cole……. I recognised that undoubtedly there was hurricane damage to buildings and contents. Superficially it looked as though they were hit by a hurricane. I saw quite considerable damage……. there had obviously been extensive looting in my opinion….. In relation to the spare parts division there were no spare parts to be seen, but it was obviously a lot of containers and cardboard cartons which had contained spares. In relation to motor vehicles wheels were missing on most of them………hoods, electrical wires, headlamp units in their entirety had been removed from vehicles. Car seats removed, carpets, tail light units. There were no tools. There was virtually nothing to be seen at the mattress factory."

Schwab explained that as he walked over the site at Fond Cole he visited about 14 buildings or areas, asked questions about what he saw or expected to see. Nearly all of the questions were met with the same answer, that there had been a hurricane. To him that was unsatisfactory; but he was given an explanation of what it was like "to go through a hurricane" by Waddy Astaphan who, with others, had accompanied him on his inspection tour.

I think it ought to be recalled that Roger Schwab was having his initial experience, as a loss adjuster, of a hurricane; and so the explanation given him would have been of assistance. Schwab said;—

"He told me fear had gone through everybody. The literal tearing apart of their houses while they were inside them; the tremendous torrential rain…. soaking everything; how uncomfortable and worrying it was for everyone, lack of communication, no telephones, electricity down, trees fallen across the road, roofs of houses blown on roads, not possible to travel on roads….. people had spent their time protecting their own personal possessions……."

As far as Asta Hotel was concerned, the witness said he saw the top floor and ceiling almost totally damaged, the middle floor slightly less damaged, and the bottom floor with mainly water damage.

Almost immediately after the hurricane passed the island, the Masnaging Director and other senior members of Astaphans, using the only available means, cabled the regional Manager of Ennia, advised him of the loss and damage experienced by Astaphans and other policy holders and asked that a visit be made immediately. Subsequently a claim was computed by Austin Winston, assisted by Dermot Southwell the personnel and garage manager, and by Richard Didier the office manager.

The Ennia General Insurance Company Ltd. took steps to have Astaphans' claim investigated and adjusted. Roger Schwab, at that time a partner in Toplis and Harding, renowned assessors in England, had worked in general insurance for 10 years and as a loss adjuster for 18 years thereafter — mainly in the Middle East; he was sent to Dominica as a member of a team to investigate about two thousand claims. He was concerned with Astaphans' claim. He admitted that it was his first such experience of a hurricane, and there was evidence at the trial that he told the Managing Director of the...

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