Lords Amendment: In page 2, lines 24 to 32, leave out Sub-sections (4) and (5), and insert the following new Sub-section:
(4) Upon a transfer under sub-section (1) or sub-section (2) of this section, the insurer shall, subject to the provisions of section three of this Act, be under the same liability to the third party as he would have been under to the insured, but—
§ The UNDER-SECRETARY of STATE for the HOME DEPARTMENT (Mr. Short)
I beg to move, "That this House doth agree with the Lords in the said Amendment."
§ Mr. SHORT
This is purely a drafting Amendment. During the progress of the Bill, we were not altogether satisfied with Sub-sections (4) and (5); and certain Amendments which were made by this House, and the inclusion of Clause 3, accentuated the doubts that existed in our minds. Consequently, it was thought necessary to delete Sub-sections (4) and (5), and to include the Amendment which was made in another place and which is now before the House. The purpose of the new Sub-section is to cover three points—firstly, that upon transfer the insurance company shall be under a liability to the third party neither greater nor less than that under which it would have been to the policy holder; secondly, that, if the insurance company is under a greater liability to the policy holder than the policy holder is under to the third party, the policy holder may recover from the insurance company anything due under the policy in excess of what was paid to the third party; and, thirdly, if the liability of the insurance company to the policy holder is less than that of the policy holder to the third party, the third party shall have the right of recovering anything that he can get under the policy, and also of recovering any balance from the policy holder. We are satisfied that Sub-sections (4) and (5) as drafted do not clearly set out these three intentions, and the Amendment which we now propose to accept does so.
§ Lord E. PERCY
I can only say that both the old provision and the new seem to be equally incomprehensible.
§ Question, "That this House doth agree with the Lords in the said Amendment," put, and agreed to.