TRADING COMPANY L. & J. HOFF v. UNION INSURANCE SOCIETY OF CANTON, LTD., AND C. I. DE ROUGEMONT.

(1928) 32 Ll L Rep 299

KING'S BENCH DIVISION.

Before Mr. Justice Wright.

Insurance (theft)-Loss of bearer shares in Esthonian railway company (successors of Russian company with properties in Esthonia, Latvia, Lithuania, Poland and Russia) during railway journey-Claim-Defence of non-disclosure and of fraudulent over-valuation and denial that loss occurred- Inferences to be drawn from nature and assets of company-Acquisition of shares by plaintiffs-Doubt as to genuineness of deposit receipts alleged to have been issued by Russian banks (certifying holdings in Russian company) entitling holders to shares in Esthonian company; as to genuineness of agreement between plaintiffs and Esthonian company authorising transfer to plaintiffs of shares in Esthonian company in consideration of transfer by plaintiffs to Esthonian company of new issue of shares in L.H. company-Position of L.H. company considered-Extravagant value put upon L.H. shares- Sale of line in Esthonia to Esthonian Government-Alleged loss of control of Esthonian company consequent upon loss of shares-Finding that even after alleged loss plaintiffs could still have controlled company and prevented sale to Government -Value of Esthonian company's assets-Inference to be drawn from compensation price paid by Government -Fictitious values put upon Latvian, Lithuanian and Polish properties -Scheme to produce appearance of market value for shares-Evidence of transfer of shares at price such lower than insured value-Non-disclosure -Whether obligation to disclose (where a question of valuation) limited to matters affecting risk-Whether necessary (to avoid policy) for over-valuation to be conscious and deliberate-Duty to disclose highly speculative value-Waiver- Whether name of Esthonian company should have put underwriters on inquiry - Evidence of theft during journey - Cumulative probabilities