JUDGMENT OF ABBAN J.
The plaintiffs are an insurance company, carrying on business in Ghana. In June 1962 they issued to the defendant, who is a transport owner, a third party policy No. CV 39736 in respect of a number of vehicles. Later, the plaintiffs agreed to extend the said policy to cover an Austin commercial vehicle No. GE 2844, also owned by the defendant.
On or about 29 August 1963, by a hire-purchase agreement, the defendant sold the said vehicle No. GE 2844, to one Kwasi Twum. The plaintiffs contending, that the sale was without their knowledge, brought the present action for a declaration that the policy No. CV 39736, so far as the vehicle No. GE 2844 was concerned, became void and of no effect after the said sale. The defendant in his statement of defence admitted that he had sold the vehicle under a hire-purchase agreement as alleged, but he averred that be did so with the consent of the plaintiffs, because the plaintiffs knew all the time that the defendant was running a transport business by selling, on hire-purchase, all those vehicles which were insured with the plaintiffs.
On 16 March 1972, both counsel agreed that the main issue in the case is one of law. That is whether the defendant after selling the vehicle No. GE 2844 to one Kwasi Twum still had an insurable interest [p.228] in the said vehicle. It is obvious that if the defendant could not be said to have an insurable interest in the said vehicle, then of course, the said policy would have to be declared void and of no effect, so far as that particular vehicle is concerned.
Thus, by consent, that issue was set down for legal argument. The summary of the argument of learned counsel for the plaintiffs is that the defendant, having disposed of the vehicle to the said Kwasi Twum, has no more interest in the vehicle, because once the vehicle has been sold the defendant's rights as the owner automatically ceased and the policy lapsed. Counsel submitted that it does not make any difference whether the sale was an outright one or on a hire-purchase. Learned counsel for the plaintiffs relied on certain cases which were referred to by the Court of Appeal in the case of Royal Exchange Assurance v. Sosu, Court of Appeal, 4 May 1970, unreported.
In his reply, learned counsel for the defendant argued that in spite of the sale by a hire-purchase agreement, the defendant still had an insurable interest. He submitted that the defendant would cease to have any interest in the vehicle only aft
