Insurer loses appeal in $1.4M premium dispute

Derek Achong

Se­nior Re­porter

[email protected]

An in­sur­ance com­pa­ny has failed in its ap­peal chal­leng­ing a judge's de­ci­sion to grant a de­fault judg­ment against the di­rec­tors of one of its agen­cies for al­leged­ly fail­ing to re­mit al­most $1.4 mil­lion in in­sur­ance pre­mi­ums it col­lect­ed.

In a judg­ment de­liv­ered late last month, Ap­pel­late Judges Mark Mo­hammed and Pe­ter Ra­jku­mar dis­missed New In­dia As­sur­ance Com­pa­ny's ap­peal against Randy and Cha­nar­daye Ra­mad­hars­ingh.

The law­suit re­lat­ed to two con­tracts signed be­tween the com­pa­ny and the Ra­mad­hars­inghs' agency Kineti­ka Con­sul­tants Ltd in 2016 and 2021.

Un­der the first con­tract, it was agreed that Kineti­ka would pro­cure prop­er­ty, mo­tor and mis­cel­la­neous ac­ci­dent in­sur­ance on be­half of New In­dia and pay over the pro­ceeds in ex­change for a com­mis­sion.

Un­der the sec­ond con­tract, Kineti­ka was re­quired to set up a con­sumer trust ac­count and pay up all pre­mi­ums col­lect­ed with­in ten days. It was al­so re­quired to sub­mit a state­ment of the pre­mi­ums is­sued fort­night­ly for com­mis­sions to be paid.

In Ju­ly 2022, New In­dia filed a law­suit seek­ing pay­ment of $6,932,463.71 ($5,533,983.02 un­der the 2016 con­tract and $1,398,480.69 un­der the 2021 con­tract). It al­so sought $410,994.56, which rep­re­sent­ed the dis­hon­oured cheques it al­leged­ly re­ceived from Kineti­ka, and $25,000 for ex­pens­es.

A month lat­er, New In­dia ap­plied for sum­ma­ry judg­ment against Kineti­ka and the Ra­mad­hars­inghs, claim­ing that they had no prospect of suc­cess­ful­ly de­fend­ing the law­suit.

In turn, Kineti­ka and the Ra­mad­hars­inghs ap­plied for New In­dia's case to be struck out as they claimed that the dis­pute should have been re­solved through ar­bi­tra­tion.

In 2023, a judge grant­ed a sum­ma­ry judg­ment against Kineti­ka for the mon­ey claimed in re­la­tion to the first con­tract but di­rect­ed that the re­main­der of the claim con­tin­ue.

Al­most a year lat­er, New In­dia made an­oth­er ap­pli­ca­tion for a sum­ma­ry judg­ment against Kineti­ka and the Ra­mad­hars­inghs for the re­main­ing as­pects of its claim, in­clud­ing an ac­cu­sa­tion that the Ra­mad­hars­inghs dis­hon­est­ly as­sist­ed Kineti­ka in breach­ing the con­tracts.

In June last year, Jus­tice Kevin Ram­cha­ran dis­missed the ap­pli­ca­tion for the judg­ment against the Ra­mad­hars­inghs. How­ev­er, he up­held the claim against Kineti­ka over the dis­hon­oured cheques.

Jus­tice Ram­cha­ran ruled that the Ra­mad­hars­ingh had a rea­son­able de­fence in re­la­tion to the cheques as they claimed that the is­sue arose from clients pro­vid­ing dis­hon­oured cheques for pre­mi­ums.

The Ra­mad­hars­inghs al­so claimed that New In­dia con­sent­ed to the ad hoc sys­tem of busi­ness that Kineti­ka op­er­at­ed, in­clud­ing ac­cept­ing cred­it clients and post-dat­ed cheques.

The ap­peal pan­el ruled that their col­league's rea­son­ing could not be fault­ed.

"The judge was not plain­ly wrong to dis­miss the ap­pel­lant’s ap­pli­ca­tion for sum­ma­ry judg­ment," Jus­tice Mo­hammed said.

He sug­gest­ed that the le­gal is­sues should be re­solved at an even­tu­al tri­al.

"None of this is to say that the di­rec­tors will au­to­mat­i­cal­ly suc­ceed at a tri­al. In the tri­al more ma­te­r­i­al will emerge in ev­i­dence on both sides which will no doubt nar­row the dis­pute fur­ther and re­quire test­ing in cross-ex­am­i­na­tion," Jus­tice Mo­hammed said.

New In­dia was rep­re­sent­ed by Prakash De­onar­ine and Jerome Maxime.

Kineti­ka and the Ra­mad­hars­inghs were rep­re­sent­ed by Ron­nie Bisses­sar and Varin Gopaul-Go­sine.