IN THE SUPERIOR COURT OF JUDICATURE
IN THE HIGH COURT (GENERAL JURISDICTION DIVISION)
ACCRA - A.D 2016
KWEKU Y. PAINTSIL, ESQ - (Plaintiff)
DONEWELL INSURANCE CO LTD - (Defendant)
DATE: 28TH NOVEMBER, 2016
SUIT NO: GJ 160/2015
JUDGES: KWEKU T. ACKAAH-BOAFO JUSTICE OF THE HIGH COURT
BASILIA ADJEI TAWIAH FOR LAWRENCE ASANTE AHENKORAH - FOR THE PLAINTIFF
DANIEL KOOMSON - FOR THE DEFENDANT
 This is a dispute between an insured and his insurer concerning re-imbursement for the cost of repairs incurred by the insured because of damage to his vehicle which occurred at the workshop of a third party. The insurer takes the position that a contractual relationship was established between the insured and the owners of the workshop when he took his vehicle there for repairs and therefore the insured is absolved from any claim of liability arising out of the repairs of the vehicle.
 The analysis of this issue requires an examination of the terms of the policy, the principles applicable to contractual liability and the governing authorities if any. I will begin with some brief background.
 On July 30, 2014, the Plaintiff took a comprehensive motor insurance for his Mercedes Benz R320 CDI 2007 with registration number GE 8978-14 with the Defendant Company. The policy was renewed from the initial date until January 6, 2016. During the pendency of the policy on June 3, 2015 there was a heavy downpour in Accra which flooded many parts of the city resulting in loss of life and property. On the day of the flooding, the Plaintiff’s vehicle was parked at the workshop of Premier Technic for what the Plaintiff calls a “routine maintenance checks”. Premier Technic was a casualty of the flood and the Plaintiff’s vehicle was damaged as a result, causing it to be completely inoperable. The Plaintiff says he spent the sum of GH¢25,000 to render the vehicle serviceable.
 The Plaintiff made a claim under the policy No. KADMPP 0029291400 for the amount spent. It is the case of the Plaintiff that under the policy, the Defendant agreed to indemnify the Plaintiff in the sum not exceeding GH¢99,000.00 for the loss of or damage to the car. The Defendant denied the claim on the grounds that the Plaintiff was not entitled to the claim because at the material time of the flooding, the car was in the custody of Premier Technic because there was a “contractual relationship” with the Plaintiff and Premier Technic for the maintenance/repair of the car.
 On the 30th day of November, 2015 the Plaintiffs issued a Writ of Summons claiming against the Defendant, the judicial reliefs mentioned here below:
i. A declaration that the Defendants are liable to indemnify the Plaintiff in the cost of repairs of the motor car being the sum of GH¢25,000.00;
ii. Legal cost; and
iii. Any other relief or remedy that the Court may deem fit
 By a Statement of Defence filed on January 19, 2016 the Defendant admitted paragraph 3 of the statement of claim and contended that because the vehicle was parked at the workshop of Premier Technic on June 3, 2015 when the flooding occurred it is not liable under the policy. The Defendant contended that by the comprehensive motor insurance policy covering the Plaintiff’s vehicle, the Defendant is absolved from any claim or liability arising out of any contractual relationship between the Plaintiff and any third party, in this case the workshop. The Defendant contends that “the moment Plaintiff gave out his vehicle to Premier Technic a contractual relationship was established between them for the repairs of the Plaintiff’s vehicle including proper custody of the vehicle” and that absolved the Defendant from any liability arising out of that relationship.
 The Plaintiff has robustly rejected the Defendant’s contention and reliance and interpretation of “contractual relationship” and pleaded that a “contractual liability coverage is insurance for damage arising out of a tort, not for damage arising from breach of a contract, the said contract being one that a policy holder (like the Plaintiff) enters into with a third party (like Premier Technic) and the policy holder indemnifies the third party for certain tort actions against the third party arising out of the subject matter of the contract between the Policy Holder and the third party, in respect of which the policy holder calls upon his insurers to indemnify the third party”. The Plaintiff prayed that the issue be set down as a preliminary legal issue.
 At the close of pleadings and at the application for directions stage, the Plaintiff set down one main issue and the omnibus issue for the Court’s determination. They were viz:
a. Whether or not, on the facts undisputed in paragraph 3 of the statement of claim, the Defendant is absolved from liability on the basis of Part E Clause 16 of the Comprehensive Motor Policy.
b. Any other issue arising from the pleadings.
 Pursuant to Order 33 Rule 3 and Order 21 Rule 3 of the High Court (Civil Procedure) Rules, 2004 CI 47, Counsel for the Plaintiff prayed that the point of law raised in the reply be set down for hearing as a preliminary legal issue and the result to bind the parties as the final judgment in the suit.
Defendant’s counsel agreed to same and therefore the court ordered the parties to file written submissions on the issues in accordance with the Rules of Court.
 It has to be reiterated that where a party sets down a point of law for legal argument that issue could properly be taken when the contention did not rest on evidence. Where it rested on disputed facts, that point of law must abide the full trial unless the disputed facts could be disposed of with the least difficulty. In Miller v Attorney General (1975) 2 GLR 31 Abban J (as he then was) stated the rule that a point of law must be raised on the facts pleaded and the material facts upon which the said point of law was to be grounded must be clearly pleaded to enable the court to determine whether or not the preliminary point of law as raised was well founded.
The Positions of the Parties
(i) Insurers’ Position
 The Defendant says the Plaintiff is not entitled to recover under the policy the cost of repairs under the comprehensive policy he signed because “at the material time of flooding, the vehicle was in the custody of Premier Technic who had entered into a contractual relationship with the Plaintiff for the maintenance/repair of the vehicle”. According to the Defendant from the very moment the Plaintiff handed over the vehicle to Premier Technic, a contractual relationship was established between the Plaintiff and the workshop both for the repair and proper custody of the vehicle. To that extent therefore, the Defendant is absolved from liability under the policy.
 The Defendant has further submitted by relying on Part C, Section 1 and 2 that the Defendant/Insurer is liable to pay or indemnify the Plaintiff if the loss or damage caused by the flood arose out of the use of the Plaintiff’s vehicle. According to the Defendant, the operating phrase is “out of the use of your vehicle” meaning at the time of the unexpected event the vehicle should be under the care, control and custody of the Plaintiff. Further, the Defendant illustrates the point and submits that “if the Plaintiff parked the car by the roadside or his house or in front of his law firm or in the Court premises and the vehicle got flooded resulting in damage to the car then the Defendant has no option than to pay or indemnify the Plaintiff” [Emphasis Mine].
 Further, Defendant Counsel has strongly submitted that on June 3, 2015 the vehicle was not under the care and control of the Plaintiff but Premier Technic. According to learned Counsel there was a contractual relationship because Premier Technic was to maintain and/or check the vehicle as mechanics for a reward/consideration. Counsel submitted that the kind of contractual relationship established between the Plaintiff and Premier Technic is bailment. Relying on the Black’s Law Dictionary, 7th Edition where bailment is defined as “a delivery of personal property by one person (bailor) to another (the bailee) who holds the property for certain purpose under an express or implied-in-fact contract”. Counsel further relies on the definition quoted and explains that “although a bailment is ordinarily created by the agreement of the parties, resulting in a consensual delivery and acceptance of the property, such a relationship may also result from the conduct of the parties dealing with the property in question. A bailment relationship can be implied by law whenever the personal property of one person is acquired by another and held under the circumstances in which principles of justice require the recipient to keep the property safely and return it to the owner”.
 The Defendant’s counsel further posits that it was the duty of Premier Technic to hand over the Plaintiff’s vehicle in good condition as the Plaintiff had a legitimate expectation to have his vehicle back in good condition. To this extent, the Defendant Counsel has submitted that Premier Technic “had the responsibility for the safe keeping of the vehicle from theft, ravage and/or loss or damage by flooding or whatever means failing which the Defendant will not pay”. Counsel concludes by submitting that pursuant to the Insurance Act, 2006 (Act 724) Section 184, Premier Technic is required to have obtained an insurance coverage for the building it operated from and it is such insurance policy of Premier Technic the Plaintiff should claim from and not the policy between the Plaintiff and the Defendant. From the submission, Counsel implores the Court to simply find for the Defendant and dismiss the Plaintiff’s claim.
(ii) Insured Plaintiff’s Position
 The Plaintiff has submitted that the Defendant’s position in this matter is misconceived because it has misconstrued what constitutes “contractual liability”. Relying on the works authored by scholars including Brent Radcliffe, Michael A. Rossi (in the article titled “New ISO Forms Contract Contractual-Liability Insurance) and Gary Shapiro) the Plaintiff says a contractual relationship is where the policy holder (like the Plaintiff) is seeking to call upon the insurance company to assume a liability that the policy holder has assumed by contract with third parties under the general rubric of an insurance policy which the policy holder has with the insurance company. Learned Counsel further explains that it is reasonable for Insurance Companies to make such exclusions based on the policy rationale that risk to third parties may be too remote and highly unpredictable. Learned Counsel submits that in the case at bar, the Plaintiff is not calling upon the insurance company to assume his liability with any third party, that is Premier Technic and therefore the Defendant’s argument is flawed.
 Further, the Plaintiff has submitted that the Defendant’s contention is based on a faulty logic because there is no evidence that the damage was caused as a result of the negligence of Premier Technic and that even if they were negligent, the fact that the Plaintiff can maintain an action directly against them to recover damages can never be an issue and an excuse in a claim founded on the comprehensive motor insurance policy he had against the Defendant insurance company. The Plaintiff further submits that there is no difference between him making a claim under the policy for losses in a situation where a negligent driver crashes into his vehicle in a broad day light and the possibility of also making a claim against that driver.
 Further, it is the case of the Plaintiff that the Defendant’s contention is flawed because of the fact that it concedes that it shall and would be responsible if the vehicle had been parked in the premises of the Plaintiff’s law firm, house and/or by the roadside. To the Plaintiff therefore the fact that the vehicle was parked at the premises of Premier Technic without more ought not and should not absolve the Defendant from liability.
 According to the Plaintiff a comprehensive motor insurance policy provides that the insurer (Defendant) might at its own option repair, reinstate or replace the motor car or might pay in cash the amount of the loss or damage. To the Plaintiff therefore, since the policy he had with the Defendant was comprehensive and covers incidents such as theft, vandalism, fire, natural disasters (like flood, hurricane or a tornado), falling objects, damage done to car by animals and civil disturbance (like a riot that results in damage or destruction to the car) under Part C, Sections 1, 2 and 3 of the policy and the Defendant promised to fulfill its obligations under the policy and more, its Defendant’s position is wrong in law and untenable.
 Finally, the Plaintiff submitted that under the principle of subrogation the Defendant Insurance Company retains the right to pursue a third party, in this case Premier Technic if it believes that it caused the loss or the damage. According to the Plaintiff an insurance contract as a typical standard form contract in which the policy holder (the Plaintiff herein) has virtually no input whatsoever, the insurer (Defendant herein) should not be allowed to have any unconscionable advantage. The Plaintiff has therefore urged the Court to dismiss the Defendant’s contractual liability claim argument because the facts do not support the contention.
 I note that by way of a reply to the Plaintiff counsel’s submission, the Defendant counsel has implored the Court to disregard the research work of the authors/academics Plaintiff relied upon on the grounds that their writings are from the internet and therefore are not from a “worthy source” or necessarily reputable.
Analysis & Opinion of the Court:
 The issue for my determination in this suit makes it necessary to re-echo the remark of Lawton LJ in Young v Sun Alliance and London Insurance Limited  1 WLR 104,
“This appeal raises semantic problem which has troubled many philosophers for centuries, and it can, I think, be expressed in the aphorism that an elephant is “difficult to define but easy to recognize”.
Undoubtedly, it is very easy to understand the general provisions of the entire policy than a single clause which is at the centre of this law suit. The difficulties associated with interpretations of clauses of agreements such as the clause at the centre of this litigation are often the result of inadequate attention being paid to the drafting of such agreements by the parties.
 Again, as Phillips J, also once observed in determining a re-insurance dispute “as is the way with hotly contested issues of construction, Counsel on each side has assured me that my task is a simple one and that the answer is obvious. I do not find the issue simple”.
 In the case at bar, the policy was a Comprehensive policy designed to provide coverage for the Plaintiff’s car and provided for under Part C of Section 2 to “repair, reinstate or replace your vehicle or pay the amount of the loss of or damage to your vehicle. The maximum amount payable by us will be the market value at the time of the loss or damage or the Sum Insured shown in the Schedule whichever is less”.
 The policy contains the following provision at Part E, Clause 16 under the heading "We Will Not Pay":
“For any claim arising out of any contractual liability”.
It is the pivot around which this whole litigation spins.
 I will consider the features of this clause (the "We will not Pay") later in these reasons when I consider the plain language of the policy. I will note, however, that this clause serves an important practical purpose for the insurer as an exclusion clause. By making the insurer’s we will not pay right available in the policy, it becomes possible for the insurer to be absolved from liability from certain claims. I also note that, in this case, there is no evidence of the insured entering into any express agreement with Premier Technic. The insurer is however inviting the Court to imply same.
 From the outset, I wish to state that I have tried but failed to locate any local case in which the Supreme Court has pronounced upon the subject matter. I have therefore looked at other common law jurisdictions for guidance. Undoubtedly, the resolution of the main issue will require the meaning of “Contractual Liability” as understood in insurance law, but first it will be helpful to consider some general principles.
 In the Canadian Supreme Court case of Somersall v. Friedman,  3 S.C.R. 109,  S.C.J. No. 60, at para. 45, Iacobucci J., speaking for the majority, set out a methodology for the analysis construing an Insurance policy. He suggested that the court should consider
(a) the plain language of the insurance contract;
(b) in relation to the terms of that contract,
(i) the special principles of interpretation; and
(ii) the general principles of law applicable to insurance contracts;
(c) the views of other courts; and
(d) particularly in the case of publicly regulated insurance contracts, the wisdom of the policy that will result from the interpretation adopted by the court.
 In this case I will adopt the (a) and (b) above and speak to the meaning of Contractual Liability and other terms in the context of the policy signed between the parties. I begin my analysis with the observation that an insurance contract, like any other contract, should be construed in a manner that attempts to harmonize and make sense out of the various provisions contained in it, and does not strain them. Ambiguities are to be resolved in favour of the insured. But ambiguity does not exist whenever the policy contains wording that could be open to two or more reasonable interpretations.
 Susan Hodges in her book “Cases and Materials on Marine Insurance Law” has the following helpful statement with regards to Insurance as a contract of indemnity to say at page 1:
The basic principle of a contract of insurance is that the indemnity recoverable from the insurer is the pecuniary loss suffered by the assured under that contract.
 The learned author further states that the philosophy behind insurance and indemnification was summed up in the early case of Brotherston v Barber (1816) 5 M&S 418, where Abbott J aptly stated the law at page 425 as:
“…But, the great principle of the law of insurance is that it is a contract for indemnity. The underwriter does not stipulate, under any circumstances, to become the purchaser of the subject matter insured; it is not supposed to be in his contemplation: he is to indemnify only. This being the principle, it seems to me that any practice or doctrine which is calculated to break in upon it ought to be narrowly watched”.
 Further, the principle that a policy of insurance is a contract of indemnity was expressed in the frequently cited decision of Brett L.J. in Castellain v. Preston (1883), 11 Q.B.D. 380, 52 L.J.Q.B. 366 (C.A.), at p. 386 Q.B.D as follows:
The very foundation, in my opinion, of every rule which has been applied to insurance law is this, namely, that the contract of insurance contained in a marine or fire policy is a contract of indemnity, and of indemnity only, and that this contract means that the assured, in case of a loss against which the policy has been made, shall be fully indemnified, but shall never be more than fully indemnified. That is the fundamental principle of insurance, and if ever a proposition is brought forward which is at variance with it, that is to say, which either will prevent the assured from obtaining a full indemnity, or which will give to the assured more than a full indemnity, that proposition must certainly be wrong.
 That being said, it is also important to note that an insurance policy is a contract of indemnity "according to its terms". The terms of the policy invariably address the circumstances in which indemnity is required, the extent of the indemnity provided and the consequences flowing from the indemnification. The terms of the policy must therefore be examined to determine these matters.
 The real battleground of this suit is about the meaning and the consequences of the term of “Contractual Liability” as used at clause 16 of the policy. Before addressing the contractual liability issue, in my opinion, it is important and desirable to set out in detail part of the critical provisions of the policy signed.
Part C – We will Pay, Section 1 – Vehicle Loss or Damage
Section 1 – For loss of or damage to your vehicle caused by or arising out of:
(e) Flood, Typhoon, Hurricane, Volcanic Eruption, Earthquake or other Convulsion of Nature, strike, Riot, Civil Commotion.
2. We will, at Our option, repair, reinstate or replace Your Vehicle or pay the amount of the loss of or damage to Your Vehicle. The Maximum amount payable by us will be the market value at the time of the loss or damage or the Sum Insured shown in the Schedule whichever is less.
3. You may authorize the repair of your damaged motor vehicle for which We may be liable under this policy provided that:
a. the estimated cost of such repair does not exceed the authorised repair limit shown in the schedule
b. we are furnished immediately with a detailed estimate of the cost and
c. You shall give every assistance or opportunity to ensure that such repair is necessary and the charge reasonable.
Part E. We Will Not Pay
1. If your vehicle is driven without your consent, order or permission.
2. If your vehicle is driven by You, or by any person with your consent, who is not licensed to drive Your Vehicle under all relevant laws.
15. For depreciation, wear and tear, rust or corrosion, mechanical, structural, electrical or electronic breakdown or failure.
16. For any claim arising out of any contractual liability.
 I note that Part B, the Definitions section does not define what constitute “Contractual Liability” in the policy which is the subject matter of the suit. The Defendant says it is a form of bailment and the Plaintiff says it is not but rather it is where the policy holder (like the Plaintiff) is seeking to call upon the insurance company to assume a liability that the policy holder has assumed by contract with third parties under the general rubric of an insurance policy which the policy holder has with the insurance company.
 So what is it? According to Black Law Dictionary, the online edition, contractual liability insurance is an “Insurance covering the insured from liability which are their responsibility as per a written contract”. It also defines Contractual liability as “Responsibility taken by any party under contract, as per the conditions of contract”.
Also, according to Commercial General Liability (CGL) Insurance policy - Contractual liability insurance is defined as coverage for the named insured's liability that is created when it assumes, in an oral or written contract, the financial consequences of another's negligent acts or omissions that results in bodily injury or property damage to a third party
 I note that the Defendant’s Counsel did not define the term “Contractual Liability” but rather explained that it is a form of bailment. In interpreting the policy signed by the parties and in particular using the language of the contract itself, with respect, I cannot agree with the learned counsel for the Defendant’s view on the meaning ascribed to the contractual liability. I am of the respectful view that the “Contractual Liability” must be interpreted in the context of the entire policy. To my mind, the meaning ascribed to the clause by the Plaintiff is more in sync with the definitions stated above and in line with the tenets of the comprehensive policy signed and the cluster of clauses contained therein in particular the Part E, starkly titled: “We Will not Pay”. In the opinion of the Court, exclusionary words must be given their literal meaning and where any ambiguity might arise, interpreted in favour of the insured. In this case, it is my finding that the clause at the centre of the litigation is not open to two different meanings but one. The Defendant’s meaning ascribed is wrong and I reject same.
 The question that needs to be answered is this: what is the peril for which insurance coverage was obtained? It is to take care of the unforeseen circumstances such as occasioned the Plaintiff. The Defendant says if the flooding had occurred while the vehicle was parked in the Plaintiff’s house, office and/or the road side it would have had “no option than to indemnify the Plaintiff for the loss or damage” but in this case, because it was parked at Premier Technic’s workshop it is absolved from liability. With respect to Counsel, I think such interpretation of the policy would certainly do violence to it and undermine the very essence of the policy. There is no evidence that the flooding occurred due to the negligence of the workshop. The Defendant agreed to pay for any loss or damage to the vehicle due to “flood’ and more without specifying any location; to deny liability based on the location the flood took place in this case is not only disingenuous but unreasonable and without basis. In my view if there is any uncertainty as to whether a claim falls within the Plaintiff’s policy coverage, the uncertainty must be resolved in favour of the insured. This is because it is generally accepted that in interpreting insurance policies, provisions granting coverage are to be construed broadly while exclusion clauses are to be construed narrowly and also to my mind the policy ought to be interpreted in a commercially reasonable fashion and in a way that gives effect to the reasonable expectations of the parties.
 Fundamental to a determination of whether the Insurer is liable is the fact that contracts with insurance companies are not subject to negotiation. The wording of the policies is written in stone. The buyer must "take it or leave it". The buyer is looking for peace of mind when purchasing insurance. Peace of mind should only be disturbed in the face of clear, unambiguous wording. The Defendant cannot and should not be allowed to use an undefined wording in the policy to absolve liability as being espoused in this case. As the case law cited above establish, the very foundation of every rule which has been applied to insurance law is that the contract of insurance is a contract of indemnity, and of indemnity only. As a comprehensive policy, the policy at the centre of this litigation is very broad and portable and covers occurrences caused by natural disasters such as floods, hurricane, volcanic eruption etc. It is obvious that claims upon the policy will invariably be brought after an "occurrence". The only bar to liability are those listed under Part E, which I have found that it is not the situation in this case. If the occurrence took place within the applicable policy period of the contract of insurance, as in this case a duty to be liable arises and it is my finding that the Defendant is liable to the claim made by the Plaintiff.
 Finally, if indeed the Defendant believes that Premier Technic is liable for the loss because it had an obligation to “keep the vehicle in good condition”, then it should meet its obligation to the Plaintiff and then go after Premier Technic under the principle of subrogation. It should not wittingly avoid liability under the guise that pursuant to Section 184 of Insurance Act, 2006 (Act724) the Plaintiff should make a claim against the workshop owners. If that is true, then did the comprehensive insurance coverage have any meaning at all to the Plaintiff?
Conclusion & Disposition
 In the light of the foregoing reasons I resolve the sole issue set down in the application for directions in favour of the Plaintiff against the Defendant. In my respectful opinion, I have interpreted the clause at the centre of this litigation with the policy as a whole and in a manner that gives meaning to all of its terms, determining the intention of the parties in accordance with the language that they used, and with regard to the pleadings filed and the submission of Counsel. The interpretation of clause 16 and the conclusion I have arrived at in my view is commercially reasonable and gives effect to the reasonable expectations of the parties.
 Overall, I am satisfied that on the preponderance of probabilities, the case of the Plaintiff based on the evidence submitted before the court is more probable than that of the Defendant. In consequence, judgment is entered for the Plaintiff for the reliefs (i) and (ii) endorsed on the writ.
I decline to make any other relief or remedy!
Plaintiff’s costs is also assessed at Gh¢5,000 to the Plaintiff.