Assignment

The Claims Manager of Perfect Insurance Company Limited has sent you an e-mail narrating the following facts:

"A customer took out a commercial motor insurance policy in respect of motor vehicle PSD499AH, a Nissan Minibus. The policy was effective from 25/10/2018 to 24/10/2019. The customer completed a proposal form in which he declared that the motor vehicle would be used to carry own goods only and would not be used to carry passengers for hire. The Company accepted the proposal and agreed to issue insurance cover.

The customer paid the premium and then took up a cover for third party risks. A certificate of insurance and a policy document was issued. On 6/3/2019, during the currency of the policy, the motor vehicle was involved in a self-involving accident (no other vehicle was involved) at around 5 pm on the Mbabane-Manzini MR3 highway. The insured declared that at the time of the accident he was traveling to Manzini ferrying his own goods.

Subsequently the company received a Notice of Motion dated 17/7/2019 in which the insured was named as the defendant. The Plaintiff was one Azziad Dlamini. Azziad described herself in the complaint as a fare-paying passenger.

The Company did not involve itself in the suit. It has now received a letter of demand requiring it to satisfy an Order of Court made under the provisions of the Insurance Act, 2005."

Requirement

The Claims Manager requires your legal advise. With the aid of decided cases and citing relevant legal principles, advise the Claims Manager regarding the legal position