THE Constitutional Court (ConCourt) yesterday slammed the Zimbabwe Revenue Authority (Zimra) for illegally issuing motor vehicle insurance policies and collecting insurance premiums, without a proper licence.
BY CHARLES LAITON
This came out in the judgment delivered by a judge of appeal, Justice Bharat Patel, in a matter in which the Tour Operators’ Business Association of Zimbabwe (Tobaz) had approached the court accusing Zimra of creating a monopoly in the issuance of insurance cover.
However, the court dismissed Tobaz’s application accusing the association of “operating criminally and acting in violation of an Act of Parliament as opposed to purely subordinate legislation”.
Justice Patel said Insurance Regulations 1989 (Statutory Instrument 49 of 1989), framed in terms of Section 89 of the Act, was put in place to regulate the conduct of virtually every class of insurance business and activity.
He said this included insurance agents and Zimra had in its operations violated the law.
“It is abundantly clear from the foregoing that Zimra is acting in contravention of the insurance regulations, by purporting to issue motor insurance policies and collect premiums, without being licenced as an insurance agent under the regulations,” Justice Patel said.
“Section 14 of the regulations provides for the issuance of various insurance agent licences, while Section 15 enjoins every agent who represents a registered insurer in respect of insurance business to hold a valid insurance agent licence in the class of business concerned.
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“Additionally, Section 15(5) stipulates that no registered insurer or broker shall cause or permit any agent to represent him in respect of any insurance business unless that agent is in possession of a licence in respect of that class of insurance business,” he added.
The court also took a swipe at the Motor Insurance Pool (MIP) for permitting Zimra to represent its members.
“Conversely, the MIP has also contravened the regulations by permitting Zimra to represent its nominated members as their insurance agent.
“Both parties were patently ill-advised in embarking on their agency arrangement without regard to the licensing requirements of the regulations,” Justice Patel ruled.
Turning to Tobaz, the judge said the association’s members had also violated the same law.
“As for Tobaz itself, it is equally clear that its members have also violated the peremptory provisions of the Insurance Act by not registering themselves as insurance brokers or by holding themselves out as brokers without being registered as such,” he said.
“In either event, their offence is graver in that they have contravened an Act of Parliament as opposed to purely subordinate legislation.”
Justice Patel said Tobaz could not be given the nod by the courts to perpetrate a legality.
“While this may be perfectly correct, allowing Tobaz to approach this court is one thing, but allowing it to succeed in this matter is an altogether different position,” he added.
“As I have already stated, Section 35(1) and 88 of the Insurance Act unequivocally and emphatically criminalise unregistered brokering.
“What Tobaz seeks to enforce on behalf of its members is the right to persist in and continue their criminal conduct.
“Thus, by granting the constitutional relief that Tobaz seeks, the court would not only condone its members’ flagrant violation of the law, but also sanction and perpetuate that illegality under the cover of their alleged fundamental rights . . . in short, Tobaz and its members have no cognisable constitutional cause of action.”
