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2018 Supreme(Del) 1275
IN THE HIGH COURT OF DELHI AT NEW DELHI
VALMIKI J.MEHTA, J.
T T Ltd. – Appellant
Versus
Golden Eagle Company Limited & Ors. – Respondents
RFA No.423 of 2018
Decided On : 18-05-2018
For the Appellant :Ms. Shilpi Jain Sharma, Advocate.
The main legal point established in the judgment is the requirement of insurable interest in goods for a valid claim under a marine insurance policy, as determined by the Marine Insurance Act, 1963, and legal principles regarding transfer of title in goods under f.o.b. and c.i.f. contracts.
Headnote:
Marine Insurance - Insurable Interest - Marine Insurance Act, 1963, Sections 7, 8 - The court held that the appellant/plaintiff had no insurable interest in the goods as ownership had passed to the buyer, and therefore was not entitled to claim under the insurance policy from the defendant no.3/insurance company. The court referred to the Marine Insurance Act, 1963, and legal principles established in Contship Container Lines Ltd. v. D.K. Lall (2010) 4 SCC 256 to determine insurable interest and transfer of title in goods under f.o.b. and c.i.f. contracts.
Fact of the Case:
The appellant/plaintiff filed a suit for recovery of Rs.8,56,180 against the buyer, insurance company, and the company with whom the goods were insured. The appellant/plaintiff claimed to have supplied goods and taken a marine insurance policy, but the goods were damaged during the voyage. The trial court held that the appellant/plaintiff had no insurable interest in the goods as ownership had passed to the buyer, and dismissed the suit against all defendants.
Finding of the Court:
The trial court found that the appellant/plaintiff had no insurable interest in the goods and was not entitled to claim under the insurance policy. The court also dismissed the suit against the insurance company and the buyer based on the appellant/plaintiff's acceptance of a debit note for damaged goods and lack of privity of contract with the insurance company.
Issues: The issues framed by the trial court included the entitlement of the plaintiff to a decree and interest, cause of action against defendant no.3, mis-joinder of necessary parties, and relief.
Ratio Decidendi: The court's decision was based on the appellant/plaintiff's lack of insurable interest in the goods, as ownership had passed to the buyer, and the principles established in the Marine Insurance Act, 1963, and legal precedents regarding transfer of title in goods under f.o.b. and c.i.f. contracts.
Final Decision: The court dismissed the suit against all defendants, holding that the appellant/plaintiff had no insurable interest in the goods and was not entitled to claim under the insurance policy. The suit was also dismissed against the insurance company and the buyer based on the appellant/plaintiff's acceptance of a debit note for damaged goods and lack of privity of contract with the insurance company.
VALMIKI J. MEHTA, J.
C.M. Appl. No. 20573/2018 (exemption)
1. Exemption allowed subject to just exceptions.
C.M. stands disposed of.
RFA No.423/2018
2. This Regular First Appeal under Section 96 of the Code of Civil Procedure, 1908 (CPC) is filed by the plaintiff in the suit impugning the judgment of the trial court dated 11.1.2018 by which the trial court has dismissed the suit filed by the appellant/plaintiff for recovery of Rs.8,56,180. Suit was filed against the three defendants. Respondent no. 1/defendant no. 1/company was the buyer of the goods situated at Vietnam. Respondent no. 2/defendant no. 2/ was the insurance company of the respondent no. 1/defendant no. 1/buyer. Respondent no. 3/defendant no. 3 is the New India Assurance Company Limited with whom the appellant/plaintiff had insured the exported goods.
3. The facts of the case are that the appellant/plaintiff filed the subject suit pleading that between the appellant/plaintiff and the respondent no.1/defendant no. 1 there was a contract to supply De-oiled Rice Bran Extraction. Appellant/plaintiff claimed to have supplied 4040 bags of 200.28 MT of goods at a unit price of US$ 226 per MT and for which invoice no. GEX/0097 dated 1.11.2012 was raised upon the respondent no.1/defendant no. 1/buyer. Appellant/plaintiff further pleaded that it had taken a marine insurance police from the respondent no.3/defendant no. 3 on Cost Insurance Freight (CIF) basis for the consignment. The consignment was shipped on board on 14.11.2012 under the shipping bill dated 9.11.2012. Consignment was insured with the respondent no. 3/defendant no. 3, for the journey from the appellant/plaintiff’s warehouse at Kolkata to the respondent no. 1/defendant no. l/buyer's warehouse at Hochiminh City, Vietnam. The respondent no. 1/defendant no. l had also separately taken an insurance policy for the goods from the respondent no. 2/defendant no. 2. In mid December, 2012, the appellant/plaintiff received information that a portion of the cargo was damaged and accordingly the appellant/plaintiff informed the respondent no.3/defendant no.3/insurance company, vide the appellant/plaintiff’s letter dated 20.12.2012. Respondent no. 3/defendant no. 3 failed to take action and therefore appellant/plaintiff appointed its independent surveyor namely Intertek India Private Limited which gave its survey report dated 31.12.2012 that 10% of the bags were damaged. At the request of the appellant/plaintiff the respondent no. 1/defendant no. 1/buyer also appointed its surveyor which surveyed the damage to the cargo which occurred during the voyage to Hochiminh Port. Appellant/plaintiff raised the claim upon the respondent no. 3/defendant no. 3 vide its letters dated 23.1.2013 and 29.1.2013. The claim amount was US$ 19129 i.e US$ 17757 for the claim and US$ 1372 towards inspection charges. In the meanwhile the respondent no. 1/defendant no. 1 had refused to take the responsibility for the damaged consignment and it only paid US$ 3771.27 to the appellant/plaintiff and the appellant/plaintiff was to take over the balance liability for which the appellant/plaintiff received the debit note dated 6.3.2003 of US$ 14035.73 from the respondent no.l/defendant no. 1. Respondent no. 3/defendant no. 3/Insurance company repudiated the claim vide its e-mail dated 29.11.2013. Appellant/plaintiff had also approached Insurance Regulatory Development Authority (IRDA) but its grievances were not resolved. Appellant/plaintiff therefore issued a legal notice dated 28.8.2014 to the respondent no.3/defendant no. 3 claiming the suit amount along with interest, and thereafter the subject suit was filed.
4. Respondent nos. 1 and 2/defendant nos. 1 and 2 did not appear in the suit and were proceeded ex-parte. The respondent no. 3/defendant no. 3 filed its written statement and contested the claim of the appellant/plaintiff. The case of the respondent no.3/defendant no.3 was that no doubt the insurance policy was taken and loss was reported
