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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
K.S. Chaudhari, P.M.
NEW INDIA ASSURANCE CO. LTD. - Appellant
Versus
M/S. AQUA WORLD - Respondent
First Appeal No. 32 of 2014 (Against the Order dated 13.11.2013 in Complaint No. 15 of 2013 of the State Commission Goa)
Decided on : 10-03-2016
Ms. Sakshi Gupta, Advocate, for the Appellant; Ms. Triveni Poteker, Advocate, for the Respondent
Insurance policies should be interpreted in favor of the policy-holder, and any ambiguity should be construed against the insurer.
Headnote:
Insurance - Marine Insurance - 6.1.1. Perils of the seas, rivers lakes or other navigable waters - 4.1.1. Perils of the seas rivers lakes or other navigable waters - [6.1.1., 4.1.1.] - The court discussed the interpretation of the insurance policies and concluded that the second policy covered loss or damage to the subject matter, including partial loss, and that any ambiguity should be construed against the insurer. The court also referenced the judgment of the Hon'ble Apex Court in United India Insurance Co. Ltd. v. Great Eastern Shipping Co. Ltd., emphasizing the need to interpret the policy in favor of the policy-holder.
Fact of the Case:
The complainant, a firm owning a cruise passenger launch, obtained two insurance policies for the launch. The first policy covered total loss only, while the second policy for a single voyage did not restrict coverage to total loss. The launch sustained damage during the voyage, and the complainant filed a complaint when the claim was repudiated by the insurer.
Finding of the Court:
The court found that the second policy covered partial loss or damage to the subject matter, and any ambiguity in the policies should be construed against the insurer. The court also referenced the judgment of the Hon'ble Apex Court in United India Insurance Co. Ltd. v. Great Eastern Shipping Co. Ltd., emphasizing the need to interpret the policy in favor of the policy-holder.
Issues: Interpretation of insurance policies, coverage of partial loss, application of legal principles from United India Insurance Co. Ltd. v. Great Eastern Shipping Co. Ltd.
Ratio Decidendi: The second policy covered partial loss or damage to the subject matter, and any ambiguity in the policies should be construed against the insurer. The court also referenced the judgment of the Hon'ble Apex Court in United India Insurance Co. Ltd. v. Great Eastern Shipping Co. Ltd., emphasizing the need to interpret the policy in favor of the policy-holder.
Final Decision: The appeal filed by the appellant was dismissed, and the parties were directed to bear their own costs.
ORDER
Mr. Justice K.S. Chaudhari, Presiding Member - This appeal has been filed by the appellant against the order dated 13.11.2013 passed by the State Consumer Disputes Redressal Commission, Panaji-Goa (in short, 'the State Commission') in CC No. 15/2013 M/s. Aqua World v. New India Assurance Co. Ltd. by which, complaint was partly allowed.
2. Brief facts of the case are that complainant/respondent is a firm of two partners. The complainant owns a cruise passenger launch known as M.L. Carnaval having registration No. PNJ 342. The complainant insured the said launch for Rs. 30 lacs under a marine hull policy effective from 00.00 hrs of 28/09/09 to midnight of 27/09/10 by paying a premium of Rs. 26,772/-. In terms of this policy, the OP/appellant was to indemnify the complainant only in case there was total loss, actual or constructive. The relevant clause of the said policy read as follows:
6.1. This insurance covers total loss (actual or constructive) of the subject matter insured caused by
6.1.1. Perils of the seas, rivers lakes or other navigable waters.
The complainant desired to take the said launch from Panaji to Mumbai for repairs and therefore obtained a separate insurance policy for a single voyage from Panaji to Mumbai by paying a premium of Rs. 3,640/- effective 16.30 hrs. of 13/04/10. On 17/04/10 on the way to Mumbai the launch encountered bad weather and cyclonic winds and sustained damage. Complete upper deck collapsed on the port side by breaking of starboard sanctions, etc. The launch dropped anchor at Colaba Light House and thereafter was towed to Elephanta jetty by a tug name Vijay. This policy did not specify that the duty to indemnify was only in case of total loss. On the contrary, condition 4.1 reads as follows:-
4.1 This insurance covers loss of or damage to the subject matter insured caused by
4.1.1. Perils of the seas rivers lakes or other navigable waters.
The complainant reported casualty to the OP by their letter dated 17/04/10. The surveyors conducted a survey on 21/04/10 and submitted a preliminary report on 26/04/10 and asked certain documents which were provided to him, the surveyor submitted an intermediate report dated 12/06/10. The complainant by letter dated 26.04/12 submitted to the OP repair bills amounting to Rs. 28,81,909/- but by letter dated 4/7/12 the OP repudiated the claim since the damages sustained by the complainant's vessel were partial in nature and the same were outside the purview of the first policy. Alleging deficiency on the part of OP, complainant filed complaint before learned State Commission. OP resisted complaint and submitted that as loss sustained by complainant was only partial loss which was not covered under the policy, claim was rightly repudiated. It was further submitted that bills submitted by complainant included bills of wages paid to the crew members which were not payable under the policy and prayed for dismissal of complaint. Learned State Commission after hearing both the parties allowed complaint and directed OP to pay Rs. 23,49,909/- with 11% p.a. interest as expenses incurred in repair along with Rs. 25,000/- as compensation and Rs. 10,000/- additional against which, this appeal has been filed along with application for condonation of delay.
3. Delay of 28 days in filing appeal has already been condoned by the order dated 11.11.2014.
4. Heard learned Counsel for the parties and perused record.
5. Learned Counsel for the appellant submitted that on account of partial loss to the vessel, claim was not payable; even then, learned State Commission committed error in allowing complaint; hence, appeal be allowed and impugned order be set aside. On the other hand, learned Counsel for the respondent submitted that order passed by learned State Commission is in accordance with law; hence, appeal be dismissed.
6. It is not disputed that OP issued policy in favour of complainant for a period of one year from 28.9.2009 to 27.9.2010 for launches/passenger vessels employed in
