E. C. Joseph v. The Manager, M/S United India Insurance Company Limited

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT :** **THE HONOURABLE MR. JUSTICE P.BHAVADASAN** **MONDAY, THE 18TH JULY 2011 / 27TH ASHADHA 1933** **AS.No. 617 of 1995()** **---------------------------** **OS.148/1992 of ADDL.SUB COURT, N. PARAVUR** **....................** ## **APPELLANT(PLAINTIFF):** **--------------------------------------** **E.C.JOSEPH, SON OF E.V.CHEEKU, ELLATHUPARAMBIL, KUNJITHAI P.O., VADAKKEKARA VILLAGE, PARAVUR TALUK.** **BY ADV. SRI.S.VIDYASAGAR** **RESPONDENT(DEFENDANT):** **----------------------------------------THE MANAGER, M/S.UNITED INDIA INSURANCE COMPANY LIMITED, MUNICIPAL BUILDING, MAIN ROAD, N.PARAVUR** **ADV. SRI.SIBY MATHEW, WILSON URMESE** **THIS APPEAL SUITS HAVING BEEN FINALLY HEARD ON 18/7/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## **JUDGMENT** ## **TODAY, WHEN THIS APPEAL SUIT CAME UP FOR HEARING, NEITHER THE** **APPELLANT NOR HIS COUNSEL PRESENT. HENCE, THE APPEAL SUIT IS DISMISSED FOR DEFAULT.** ## **SD/-** **18.07.2011 P.BHAVADASAN, JUDGE** **/TRUE COPY/** **P.A. TO JUDGE.** **ln** **P. BHAVADASAN, J.** ........................................... A. S.NO.617 OF 1995 ............................................. Dated this the 10[th] day of August, 2011. ## **JUDGMENT** This case tells tale of a poor fisherman who happened to insure his vessel to the insurance company and had been cleverly duped by the company. 2. The plaintiff had insured his fishing boat with the defendant for a sum of Rs.3,25,000/=. The vessel capsized during fishing. The matter was reported to the insurance company. The company kept mum. According to the plaintiff, he had to run from pillar to post for getting the amount insured. Ultimately he got fed up. He executed Ext.B1 document agreeing to receive a lower sum of Rs.2,50,000/= in full and complete settlement of the claim made by him. He assails that on the ground that he was forced to execute Ext.B1 document by undue influence and fraud. On the basis of this allegation, he claimed for the balance amount. 3. The defendant resisted the plea. According to them, Ext.B1 was voluntarily executed and it is a good A. S.NO.617 OF 1995 : 2 : document. They denied the allegation in the plaint and pointed out that the suit is not maintainable either in law or on facts. The plaintiff was not constrained to execute the undertaking as alleged in the plaint. The undertaking was not obtained by exercising fraud, threat or coercion and it was voluntarily given by the plaintiff with full consent. Suffice to say that the defendant denied the liability to pay any further amount. 4. On the above pleadings, the issues were raised. The evidence consists of testimony of PW1 and Exts.A1 to A9 were marked on his side . On the side of the defendant DW1 was examined and Exts. B1 to B6 were marked. 5. The lower court had dismissed the suit taking a hyper technical view. The lower court was of the view that in the plaint, fraud, undue influence and coercion have not been specifically pleaded and that there is no prayer to set aside Ext.B1 document. 6. The question that arises for consideration is whether the court below was justified in dismissing the suit. A. S.NO.617 OF 1995 : 3 : 7. After hearing both sides and going through the records, I feel that the court below has come to the wrong conclusion on facts and law and has wrongly dismissed the suit. 8. Admittedly, Ext.A1 is the policy issued to the plaintiff. It is a valued policy. One may refers to Section 29 of the Marine Insurance Act which reads as follows: “29. Valued policy:- (1) A policy may be either valued or unvalued. (2) A valued policy is a policy which specifies the agreed value of the subjectmatter insured. (3) Subject to the provisions of this Act, and in the absence of fraud, the value fixed by the policy is, as between the insurer and assured, conclusive of the insurable value of the subject intended to be insured, whether the loss be total or partial. (4). Unless the policy otherwise provides, the value fixed by the policy is not conclusive for the purpose of determining whether there has been a constructive total loss”. 9. Section 29(3) had some relevance in this context. It mentions that in the absence of any fraud, the value shall be conclusive of the value of the policy. The value A. S.NO.617 OF 1995 : 4 : admittedly fixed under Ext.A1 is Rs.3,25,000/=. That be so, the burden is on the insurance company to show that the value was vitiated due to fraud. Prima facie that value is conclusive. The plaintiff would say that he had to run from pillar to post to get the amount from the company. He was in dire need of money and was in dire circumstances. The circumstances compelled him and on demand made by the insurance company, he happened to execute Ext.B1 document. 10. The plaintiff says that it was not voluntarily executed and it was executed under compelling circumstances. According to the defendant, it was voluntarily done and there was no vitiating elements in the execution of Ext.B1. The other contentions taken are even assuming that there are vitiating elements, it is necessary for the plaintiff to seek to have Ext.B1 set aside and unless and until that relief is sought, the plaintiff cannot succeed. 11. In support of the contention that elements of undue influence and fraud are not established, the learned counsel for the defendant had relied on the decisions A. S.NO.617 OF 1995 : 5 : reported in **Raja Shiba Prasad Singh v. Tincouri Banerji** ( AIR 1939 Patna 477) and in **Kamal Kant Paliwal v. Smt. Prakash Devi Paliwal** ( AIR 1976 Rajasthan 79). In support of the submission that unless and until details of fraud and undue influence are pleaded, the plaintiff cannot succeed, the counsel relied on the decision report in **Afsar Shaikh v. Soleman Bibi** (AIR 1976 SC 163). 12. In the case on hand the plaintiff had detailed the circumstances under which he was forced to execute Ext.B1 document. The question is whether that constituted any vitiating circumstances. PW1 has given evidence with regard to his case. He has spoken to the circumstances under which he had to execute Ext.B1 and the reasons for the same. DW1 who is examined on behalf of the company had little knowledge about the true state of affairs that led to the issuance of Ext.A1 policy. It is also significant to note that in the survey conducted by the insurance company, value of the boat was assessed. Ext.A1 policy was issued based on Ext.A2 survey report which clearly shows that the value of the boat is Rs.3,25,000/=. The company relied on A. S.NO.617 OF 1995 : 6 : Ext.B4 to contend for the position that the value is much less. 13. Ext.B4 cannot be relied for two reasons. One it is only a photostate copy. The other reason is that the person who has prepared the document had not been examined. Even assuming that since no objection had been taken at the time of admitting the document, objection cannot be taken regarding admissibility later, still the document remains unproved. It is one thing to say that the document is admitted in evidence but quite another thing to say that it is proved. The person who prepared the report was not examined and it is not shown that report was prepared with notice to the plaintiff. 14. Technically speaking, it is true that elements of undue influence and fraud as such may not have been elaborately pleaded. But the fact remains that it was under vitiating circumstances Ext.B1 came to be executed. At any rate, one is left in no doubt that Ext.B1 was not a voluntary act done by the plaintiff. To be more clear about this aspect, it is relevant to quote the clauses in Ext.B1, A. S.NO.617 OF 1995 : 7 : which read as follows: ബ��ട�ന� യഥ�ര� മ�ല�വ�ല അത� ഇന� �ര ന�യ�ത�ര�ക �ന 3,25,000/യ�ല ത�ന%യ�ന&ന�' 2.50,000/- ര�പയ�&� ബപ�ള�സ� എട�ക�ന സമയ' അത�ന� പരമ�വധ� മ�ല�വ�ല എന�'; 3,25,000/- ര�പക� ഇന��ര ന�യ�തത� വസ�ത�തകനള മറച� ഞ�ന നതറ�യ� നലക�യ വ�വരങള പപക�ര' ആന&ന�' സമത:ച� നക�ണ�2,50,000/- ര�പ (രണ� ലകത� അനപത�ന�യ�ര' ര�പ ) നഷപര�ഹ�രമ�യ� സB:കര�ച� ന�ര �പ�ധ�ക' ഒര � അവസ�നത:രD�ന� എന� പ�രEഉതരവ�ദ�തBത�ല ഞ�ന ഇത�ന�ല സമത�ക�ന�. ബമല�ല ഇബത അപകടനത സ'�ന�ബച� എ '.എഫ�.വ�.സ�.ആര നസ�� പ:റര , 380 എന മത��നന ബ��ട� ക�&�ത�യത� സ'�ന�ബച� യ�നത�ര�വ�ധ തരകങനള�, അവക�ശ വ�ദങബള� ന�ങളനകത�ര�നയ� മറ�രനകങ�ല�' എത�ര�നയ� ഉനയ�ക�കബയ� സB:കര�ക�കനയ� ന�യ�നതനNന� ഞ�ന ഇത�ന�ല പ�രE ഉറD � നലക�ന�. 15. One may recall here that the mishap occurred on 2.2.1991 and Ext.B1 was executed on 7.3.1991. The company had not produced any evidence to show that in the meantime they had done anything with regard to the application filed by the plaintiff. It is in this context the allegation of the plaintiff will have to be appreciated. He had clearly stated that the company was unresponsive to his claim and he was in dire need of money to pay off his debts ## A. S.NO.617 OF 1995 : 8 : and meet other requirements. He has specifically stated in the pleadings and evidence that under those circumstances, he happened to execute Ext.B1. He as PW1 says:- “Boat മ�ങ�യത�ന�ബശ�' ഞ�ന പല പപ�വശ�' പപത�യ�നട office കള�ല ബപ�യ�. എന�ട� പപത�യ�നട ഉബദ��ഗസര എബന�ട�ഈ 2,50,000 ര�പക� settle ന�യ&നമന� ന�രRന�ച�. അങ�നന സമത�ച�നNങ�ല papers Madras ല�ള H.Q ല അയക&നമന�' അബD�ള വളനര ന�ള ക%�നT ക�ര�ങള ത:ര� എന�' മറ�' പറT �. അങ�നന വനബD�ള ഈ ത�ക വ�ങ� settle ന�യ�ന ഞ�ന സമത�ച�. പപത�യ�നട ഉബദ��ഗസര ആവശ�നDടപപക�ര' ഇപപക�ര' ബരഖ നക�ട�ക�ബന� claim ഈ ത�കക� settle ന�യ�ബന� എന�ക� സമതമN�യ�ര�ന�. പബക എന� അബD�%നത അവസ ഇങനന എ% �ത�നക�ട�ക�ന എനന ന�രRന�തന�ക�. ” It shows the pitiable circumstance in which the plaintiff was placed and the exploiting and deceitful attitude of the company. There is no contra evidence at all. The evidence of DW1 is unsatisfactory. The insurance company has not been able to show that they had either processed the claim or that the claim was being processed. 16. After having insured the vessel for Rs.3,25,000/= the plaintiff is made to say that he has made a false A. S.NO.617 OF 1995 : 9 : representation and that the amount was only Rs.2,50,000/=. 17. The conduct of the insurance company is nothing other than fraud. Fraud may be different types. The definition in the Contract Act need not be exhaustive. It depends on the facts of each case. Viewed from that angle, it is necessary for the plaintiff to set aside that document. The fact remains that the plaintiff had received only Rs.2,50,000/=. In view of Section 29(3) of the Marine Insurance Act and in the absence of cogent and convincing evidence on behalf of the defendant there is nothing to show that policy was vitiated by fraud as contemplated under the said provision. 18. It is therefore difficult to accept the view of the lower court since there were no pleadings. 19. In the result, this appeal is allowed. the impugned judgment and decree is set aside and a decree is passed in the following terms. (i). The plaintiff will be entitled to realise a sum of Rs.75,750/= with 6% interest from the date of suit till realisation. A. S.NO.617 OF 1995 : 10 : (ii). The plaintiff is entitled to costs throughout. **P. BHAVADASAN, JUDGE.** **cl** A. S.NO.617 OF 1995 : 11 : ## **P. BHAVADASAN, J.** ........................................... A. S.NO.617 OF 1995 ............................................. 10[th] day of August, 2011. ## **JUDGMENT**