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IN THE HIGH COURT OF JUDICATURE AT MADRAS
R. SUBRAMANIAN, J.
The National Insurance Co. Ltd., Chennai & Another – Appellants
Versus
New Kashmir Arts & Crafts, Rep. by its Partner M. Abdul Majeed Khan & Another – Respondents
A.S. No. 963 of 2008 & 485 of 2011
Decided On : 28-02-2017
Insurance - Damages caused by heavy rain - Insurance Act, 1938, Section 64-VB - The court held that the loss was caused due to heavy rain and the insurance company was liable for the damages. The judgment also relied on the survey report and weather reports to establish the cause of the loss. The court rejected the insurance company's argument that the loss was not covered by the policy due to seepage of water, and upheld the assessment of damages made by the trial court.
Fact of the Case:
The plaintiff, a partnership firm, sought a money decree for damages caused to its goods by heavy rain in Chennai. The defendant insurance company repudiated the claim, stating that the loss did not fall within the scope of the policy. The trial court found the loss was caused by heavy rain and awarded damages of Rs.1,23,000.
Finding of the Court:
The court found that the loss was caused by heavy rain and the insurance company was liable for the damages. It upheld the assessment of damages made by the trial court and dismissed the appeals.
Issues: 1. Whether the insurance company was right in repudiating the claim based on the cause of the loss not being covered by the policy. 2. Whether the plaintiff was entitled to damages at Rs.5,53,720 as claimed. 3. Whether the plaintiff had established the quantum of damages.
Ratio Decidendi: The court held that the loss was caused due to heavy rain and the insurance company was liable for the damages. It rejected the insurance company's argument that the loss was not covered by the policy due to seepage of water. The court also upheld the assessment of damages made by the trial court.
Final Decision: Both the appeals were dismissed, confirming the judgment and decree of the trial court. No order as to costs was made in these appeals.
Common Judgment:
1. The above appeals have been filed against the judgment and decree passed by the VI Additional Judge, City Civil Court, Chennai in O.S.No.1862 of 2007 dated 24.06.2008. The suit in O.S.No.1862 of 2007 was filed by the appellant in A.S.No.963 of 2008 seeking a money decree for a sum of Rs.6,86,613/- with interest at 24% per annum on the principal sum of Rs.5,53,720/-.
2. According to the plaintiff, a sum of Rs.5,53,720/- represents the damages caused to the goods of the plaintiff stored at its place of business namely, New Kashmir Arts and Crafts No.171, (Old No.111) Near LIC Building, Mount Road, Chennai-2. The case of the plaintiff is that, it is a partnership firm carrying on business in sale of Kashmiriart, Kashmiri and Oriental carpets, handicrafts and jewellery. It has got three retail outlets in Chennai City. The plaintiff has taken Insurance Policy covering risks by storm, cyclone, typhoon, tempest, hurricane, tornado, flood or inundation, earthquake, fire and shock.
3. According to the plaintiff, it valued the goods for Rs.1,16,00,000/- and it had paid a premium of Rs.37,004/-. The policy was for a period of one year between 30.8.2005 to 24.8.2006. The plaintiff would contend that on 22.11.2005, there was a heavy thunderstorm in Chennai, as a result of which, the rain water entered into the plaintiff's premises at Mount Road and caused extensive damage to the valuable carpets stored in the said premises. The plaintiff, therefore, requested the defendant to survey the damage and quantify the loss. One Mr.P.Suresh was deputed by the defendant Insurance Company to assess the loss. The said Surveyor had visited the plaintiff's shop on 24.11.2005 and inspected the premises as well as the damaged goods.
4. The plaintiff had lodged a claim for a sum of Rs.4,30,720/- with the defendant on 23.11.2005. The defendant Insurance Company in its letter dated 24.3.2006 repudiated the claim of the plaintiff stating that the cause and the nature of the loss do not fall within the scope of the policy. Hence, the plaintiff was forced to sue the defendant Insurance Company for recovery of loss said to have occurred due to heavy and continuous rain in Chennai City on 22.11.2005. Initially a claim was made for a sum of Rs.4,30,720/-. After shifting the shop and finalizing the loss, it was enhanced to Rs.5,53,720/-. According to the plaintiff, the damage was caused due to heavy rain accompanied by storm on the fateful day i.e. on 22.11.2005. The plaintiff had claimed that as a result of heavy rain, the rain water entered into its premises and caused the extensive damage.
5. The defendant Insurance Company resisted the suit contending that the loss caused to the goods is not by flooding. Quoting the surveyor report, it is claimed by the Insurance Company that the damage was caused to the carpets that were stored in the first floor of the building and there was no flooding or inundation in the first floor. The damage seems to have occurred because of the seepage of the water which happened due to poor maintenance of the building. The defendant would further contend that there was no thunder storm on 22.11.2005.
6. They would also rely upon the metrological report, which recorded the fact that maximum wind speed on 22.11.2005 was at 40 kilometers per hour and the same cannot be called as thunder storm. As per Beaufort Scales, wind speed at 40 to 50 kilometers per hour is strong breeze. The Insurance Company would further claim that it is not liable to make good the damage, since the risks covered by the appellant namely, storm, cyclone, Typhoon, tempest, Hurricane, Tornado, flood and inundation were not proximate causes of the loss. The Insurance Company also disputed the quantum of damages. On the aforesaid rival contentions, the learned Trial Judge framed the following issues for determination in the appeal:
(1) Whether the plaintiff is entitled to get claim as per the plaint?
(2) Whether the damages were caused due to thu
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