MacIntyre J:

This is a claim by the plaintiff against the defendants, an insurance company, for indemnity under a policy of insurance to the extent of $7,200 in satisfaction of an award made under the Workmen's Compensation Ordinance. The writ was filed on 8 January 1964 and the statement of defence on 18 February 1964. The claim was contested on two grounds, namely,

(a) breach of warranty; and

(b)breach of condition 8 of the policy in that the plaintiff failed to have the dispute referred to arbitration within 12 calendar months of the date when the defendants disclaimed liability.

The facts of the case are as follows: on the 1 March 1960 the plaintiff obtained a licence (vide D1) from the Government of Perak to fell and remove timber from a forest compartment in the mukim of Ijok. In connection with this business the plaintiff took out a workmen's compensation policy (A2 in the agreed bundle of documents marked "A") with the defendants valid for the period commencing on 25 May 1960 and ending on 24 (inclusive) August 1960. In the proposal form (Al) the plaintiff declared that the number of workers engaged on the tree felling operation would be six consisting of two tree fellers, one lorry driver, one lorry attendant and two miscellaneous workers. On the basis of this declaration the defendants issued a workmen's compensation policy subject to a warranty that during the currency of the policy only six persons will be engaged in the operation as mentioned in the proposal form.

On 24 August 1960, one of the tree fellers in the course of his employment was killed by a falling tree and on 30 August the plaintiff gave notice (A7A) of the accident to the defendants.

Thereafter an enquiry into the accident was held by the Assistant State Commissioner for Labour and the defendants of the deceased were granted $7,200 as compensation under the Workmen's Compensation Ordinance.

Owing to the plaintiff's change of address immediately after the accident, certain letters addressed to him by the defendants in regard to the plaintiff's claim for indemnity went astray and the first letter to reach his hands was a letter dated 21 April 1961 (A18). In that letter, the defendants informed the plaintiff that their investigation had revealed that he had employed as many as 23 labourers in the operation and requested him without prejudice to their right of disclaimer, to furnish them with the names, identity card numbers, and nature of work done by each labourer with particulars of their monthly earnings to enable them to consider the claim. The plaintiff was also warned that failure to comply with the request would render the policy null and void by virtue of condition nine thereof. The plaintiff replied denying that he had employed more than six permanent labourers but admitting the employment of some other labourers on casual work not covered by the terms of the policy (vide A19). The defendants wrote again on 5 May 1961 (vide A20) repeating their demand for the particulars but the plaintiff ignored the request.

Then five months later the Assistant State Commissioner for Labour took a hand in the matter and addressed a letter to the defendants on 5 October 1961 demanding payment of the compensation. The defendants replied by letter dated 31 October (A21) disclaiming liability. Later the defendants' solicitors, M/s. Braddell & Ramani, also confirmed the disclaimer by a letter dated 15 November 1961 (A23) and a further letter (A24) dated 3 January 1962.

It is the plaintiff's case that he was never informed by the defendants or their solicitors or by the Assistant State Commissioner for Labour of the disclaimer of liability by the defendants and that he first became aware of it when a copy of the aforesaid letter of 15 November was forwarded to his solicitors, Messrs Gibb & Co, on 8 July 1963 by Messrs Braddell & Ramani. This situation was explained to Messrs Braddell & Ramani by the plaintiff's solicitors in their letter (A26) date