On the whole, the law applicable to insurance contracts in Scotland is not dissimilar to that applied in England. There are, nonetheless, points of divergence between the two legal systems and, where these occur, the results can be quite dramatic—as well as unsettling to English insurers who may have assumed the law to be the same in both jurisdictions. That differences should be permitted to continue in relation to a commercial product sold north and south of the Border by English and Scottish companies alike is unfortunate and perhaps worthy of further consideration by the two Law Commissions. As things stand, it is left to random chance as to whether a case illustrating divergence and meriting a decision which harmonizes English and Scots law arises for consideration by the Scottish courts. The subject of this paper is just such a case and the outcome has been a step towards the adoption of a common position in relation to the point raised. But complete symetry has not been achieved and this calls into question the piecemeal process of evolution which characterizes the development of common law principles of insurance. Before considering a solution, however, first some observations on the evolution of the tests of materiality approporiate to the different types of insurance cover and then a commentary on the case itself.

It is trite law, both in England and in Scotland, that a positive duty to disclose material facts is laid on both parties to an insurance contract.1 It is equally trite that, in the context of marine and, until recently, motor vehicle insurance, legislation applicable to both countries has prescribed the same test for ascertaining the materiality or otherwise of an undisclosed fact: i.e., the test of the reasonable insurer.2 Beyond this point, however, in relation to life insurance contracts the two systems have diverged and continue to do so. English law, not without some hesitation, has adopted the perspective of the reasonable insurer in determining materi-