Irfan owns a cars showroom in Rawalpindi that has been previously insured with company X. In 2016, he made a claim under insurance contract when the roof of his showroom was damaged by seasonal rains during the monsoon season.

In early 2019 Irfan sought insurance from company Z. Z Company asked Irfan if he had made any insurance claims under any other insurance contract, Irfan stated he had not made any claims.

Z Company provided Irfan with the insurance for his showroom. It is a strict condition of the contract that daily maintenance of the building shall be carried out including roof cleaning and opening of water ways.

One day Irfan fails to carry out roof cleaning and did not open the water ways. Unfortunately, heavy showers followed in same night consequently huge amount of water accumulated on the roof of his showroom. Since the water ways were closed, roof got severely damaged and leakage was observed. Considering the scope of damage and repairs involved, Irfan seeks to make a claim under the insurance contract with Z Company. The claim adjustor receives the claim and registers it. It is his job to investigate, assess and process the claims. The claim adjustor makes a superficial visit and approves Ifran's claim. Proceeds are allotted to Irfan under his insurance policy. In final stages of repairs, the insurance company suspects that the damage caused to the show room could be a possible mistake on part of Irfan's performance. Later it was discovered that Irfan was previously registered with another insurance company and made a similar claim.

1. What type of contract exists between the parties? Is the contract valid on all features of contract law? [3 marks]

2. How does the clause 'that daily maintenance of the building shall be carried out including roof cleaning and opening of water ways' affect the liability of the insurance company? [4 marks]

3. What do we mean by 'duty to disclose' under law of contract? Has Irfan breached his duty of disclosure in the given situation? If yes, how so? What are possible effects of failing to disclose vital information? [4 marks]

4. The claim adjustor made a superficial visit and declared that all was ok. Later on detailed inspection, it was revealed that Irfan has made a mistake by not cleaning the water as a result going against the clause mentioned above in question 2. How does that affect his liability and reflect his intentions? How would superficial inspection mistake affect position of the insurance company [3 marks]

5. Discuss the existence of element of fraud in relation to the situation mentioned above? Explain with detailed information of fraud and mistake and how would that affect the rights and responsibilities of both Irfan and the Insurance company. [6 marks]