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Counsel for the appellant contended that by reason of the assignment to the insurance company of all rights against the Railway Administration the respondent mill did not have any cause of action against the Railway Administration. In aid of that contention the decisions in King v. Victoria insurance Company Limited [1896] A.C. 250 and Compania Colombiana De Seguros v. Pacific Steam Navigation Co., [1965] 1 Q.B. 101 were relied on.

In the Victoria Insurance Company case (supra) the Bank of Australian effected an insurance with the insurance company of certain goods to be shipped to London. Before the cargo left Australia it was damaged or destroyed through the negligence of the defendant King, an employee of the Queens- land Government. The bank claimed a sum from the company which was duly paid. The company took an assignment by deed of all the rights of the bank against King subject to a stipulation that the bank's name should not be used in legal proceedings. The questions raised on appeal in that case were (1) the plaintiffs have no right of action at all; (2) they have no right of action in their own name. The Supreme Court of Queens-land held that mere payment by the insurance company did not subrogate them to the rights of the bank to the, extent that they could sue in their own names. The Supreme Court of Queens-land held that the assignment was covered by the Queens-land Act which corresponded to the English Judicature Act of 1873. The Queens-land Supreme Court construed the term 'legal chose in action' to include all rights the assignment of which a Court of Law or Equity would before the Act have considered lawful. On that ratio, the right covered by the assignment in Victoria Insurance Company case (supra) was held to be a right of that kind. The Judicial Committee upheld the decision and said "They rested their judgment on the broader and simpler ground that a payment honestly made by the insurers in consequence of a policy granted by them and in satisfaction of a claim by the insured is a claim made under the policy which entitles the insurers to the remedies available to the insured". The Judicial Committee on this view said that "the highly artificial defence of the Queens-land Government fails." It should be noted here that the phrase 'legal chose in action' was said in the Victoria Insurance Co. case (supra) to mean 'lawfully assignable' chose in action. A legal chose, in action is something which is not possession, but which must be sued for in order to recover possession of it. A legal chose in action does not include a right of action, such as, for instance, a right to recover damages for breach of contract, or for a tort, for it that were so, such a right would be assignable. They would materially affect the law of champerty and maintenance.

Section 6(e) of the Transfer of Property Act states that a mere right to sue cannot be transferred. A bare right of action might be claims to damages for breach of contract or claims to damages for tort. An assignment of a mere right of litigation is bad. An assignment of property is valid even although that property may be incapable of being recovered without litigation. The reason behind the rule is that a bare right of action for damages is not assignable because the law will not recognise any transaction which may savour of maintenance of champerty. It is only when there is some interest in the subject matter that a,. transaction can be saved from the imputation of maintenance.. That interest must exist apart from the assignment and to) that extent must be independent of it.

In the Law of Contract by Cheshire and Fifoot(2) the case of Compania Columbiana de Seguros v. Pacific Steam Navigation Co. (supra) is quoted an authority for the proposition that if goods shipped on a vessel are delivered in a damaged condition, the consignee, after being indemnified for his loss by the insurers can assien to the latter his right to recover damages from the owner of the vessel.

The real reason why a mere right to sue cannot be assigned is that such an assignment would offend the rule of champerty and maintenance. Now, as in this case where an insurance has been subrogated to all the rights and the remedies of the assured by virtue of s. 135-A, the reason for the rule against assignment of a mere right to sue does not obtain, because the insurance company is clothed with all the rights and remedies of the assured and the only thing lacking is the capacity to sue in its, own name. If the right is capable of being assigned, and is assigned, it would (1) Twenty-third edition, edited by A.B. Guest, p. 417. (2) Seventh edition, p. 472.