LEGAL PRINCIPLE: INSURANCE LAW — Marine Insurance — Interpretation of ‘Claim’ in Policy Condition Requiring Report Within Stipulated Time
PRINCIPLE STATEMENT
The meaning of 'claim' must be read in consonance with the circumstances in which it is used under the condition stated in the certificate. When so read, it is enough if a report, stating simpliciter that there has been loss of goods, is made within the stipulated time. That will simply show that what the consignee is expected to report at that stage is the fact of a cause of action against the carrier, not necessarily the quantum of the claim.
RATIO DECIDENDI (SOURCE)
Per Uwaifo, JSC, in Leadway Assurance Company Limited v. Zeco Nigeria Limited (2004) NLC-42000(SC) at pp. 10–11; Paras D–A.
"I think the meaning of 'claim' must be read in consonance with the circumstances in which it is used under the condition stated in the said certificate. When so read, it would appear that it is enough if a report, stating simpliciter that there has been loss of goods, is made within 21 days. That will simply show that what the consignee is expected to report at that stage is the fact of a cause of action against the carrier, not necessarily the quantum of the claim."
EXPLANATION / SCOPE
A ‘claim’ in insurance policy conditions requiring timely report means reporting the fact of loss, not the exact quantum. The insured need only give notice that a loss has occurred within the stipulated period. The principle applies to marine and other insurance contracts. The rule prevents technical defeat of claims where quantum cannot be immediately ascertained. The court interprets ‘claim’ contextually. Substantial compliance with reporting the fact of loss suffices.
