State Stands By Insurance Decision
Solicitor-General Sharvada Sharma submitted in the High Court that nothing was stopping Sun Insurance Company Limited from selling third party insurance policies or any other insurance policies.
He told Justice David Alfred that the State was not in the market of the insurance business.
He said the insurance company was of the position that the repeal of the Motor Vehicles (Third Party Insurance) Act of 1948 had deprived it of business and that the State had acquired their proprietary rights.
Mr Sharma posed the question as to what property of the company had been taken over by the State?
He said no proprietary right had been breached in the enactment of the Accident Compensation Act and the Act was intended to protect third party interest and did not create any proprietary interest for insurance companies.
It did not confer any property to them, he said.
Mr Sharma said that the Accident Compensation Commission (ACC) which was established under the Act did not provide insurance cover.
Rather it paid out damage, compensation and the like.
He said Sun Insurance was aware of the commencement date of the law and had started correspondence with the ACC and the Reserve Bank of Fiji to draft a Memorandum of Understanding to transfer all existing compulsory third party insurance policies that were going to expire after December 31, 2017.
The MOU was formally entered into in February this year.
Mr Sharma submitted that the application for constitutional redress was clearly out of time and it did not indicate any exceptional circumstance as to why the application was delayed.
He said since January 1, 2018, all vehicle owners had to pay a statutory levy to the State through the Land Transport Authority (LTA).
He said instead of buying third party insurance from an insurance company under the old Act now motor vehicle owners were only required to pay the levy and in the event an accident were to happen the State would pay No Fault Compensation through the Commission.
He said accident victims post January 2018 were being compensated under the new Act and any challenge would cause great detriment to the public interest and cause great social chaos. “Members of the public are entitled to enjoy the benefits of the Act, which provides a much better compensation scheme compared with the old Act,” Mr Sharma said.
He said it was completely against public interest to allow the Sun Insurance action to continue.
Mr Sharma submitted that there was no reasonable cause of action reflected in the insurance company’s application.
He said Sun Insurance submitted that the State had created a monopoly for itself in breach of the Commerce Commission Act. Sun Insurance lawyer Julian Moti said the defendant’s summons to strike out their application for constitutional redress undermined their undeniable constitutional right to make the application to the High Court.
He said the defendant’s summons nullified the insurance company’s constitutionally guaranteed right to apply for constitutional redress.
Justice Alfred made a ruling to include the sworn affidavit of Faizul Ariff Ali, which was filed in support of the defendant’s summons to strike out.
He said such evidence could not be excluded because the interest of justice required it to be admitted.
Hearing will continue in the High Court on Monday at 9am.