ABSTRACT
Conversely, in Samuel & Co Ltd v Dumas , 7 the policy contained a disbursement warranty that required the assured not to effect freight insurance under honour policies in excess of £13,730. Insurance for a greater sum was obtained by means of a slip that the hull insurer had itself initialled. The House of Lords did not hesitate in concluding that obtaining extra insurance from the same hull insurers amounted to an unequivocal conduct in the sense that it demonstrated an intention not to enforce a potential breach of the disbursement warranty against the assured. 8
6.4 The issue may be complicated in cases where the agent of the insurer performs an unequivocal conduct amounting to waiver of the breach of warranty
the agent has authority to bind his principal in that respect. In Fellas v Continental Insurance Co , 10 the Supreme Court of British Columbia was confronted with a problem of this nature. In that case the insurance policy contained a locality warranty, which prohibited the insured vessel from navigating outside certain “trading limits” laid down in the policy. The assured approached the agent and advised him that he wished to use the boat outside the limits. The agent said this would be all right. The insurer only became aware of the conduct of the agent after the vessel was damaged in a storm outside the trading limits. The court allowed the claim of the assured, finding that the insurer had held out the agent as having the authority to bind him. Berger J commented in the following fashion: 11
the [assured] was led to believe that [the agent] had the power to waive the warranty. The policy itself said it was not valid “unless countersigned by the duly Authorised Representative of the company”. Facsimiles of the signatures of the president of the company and the secretary appear. Then it says, “Countersigned at Vancouver BC this 28th day of April, 1970”. Over the words “Authorised Representative”, [the agent’s] stamp has been imprinted . . .
