BEFORE THE DISTRICT FORUM: KURNOOL

Present: Sri. T.Sundara Ramaiah, B.Com B.L., President

And

Sri. M.Krishna Reddy, M.Sc., M.Phil., Male Member

And

Smt. S.Nazeerunnisa, B.A., B.L., Lady Member

Monday the 29^th day of August, 2011

C.C.No.151/2010

Between:

V.Ramanjaneya Reddy,

S/o V.Rami Reddy,

H.No.25/27,

Sanjeevanagar Gate,

Nandyal-518501,

Kurnool District.                                              …Complainant

-Vs-

1. M/s. United India Insurance Company Limited,

Represented by its Divisional Manager,  

        40/304, Mourya Inn complex,  

        Bhagya Nagar,

        Kurnool-518001.

   2.  M/s. United India Insurance Company Limited,   

        Represented by its Branch Manager,

        D.No.2-415-B, N.K. Road,

        Nandyal-518501,

        Kurnool District.                     …OPPOSITE PARTies

This complaint is coming on this day for orders in the presence of Sri S.V.Krishna Reddy, Advocate for complainant and Sri I.Anantha Rama Sastry, Advocate for opposite parties 1 and 2 for upon perusing the material papers on record, the Forum made the following.

ORDER

(As per Sri. T.Sundara Ramaiah, President)

                                      C.C. No.151/2010

1.     This complaint is filed under section 12 of C. P. Act, 1986 prayingto direct the opposite parties:-      

1. To pay loss of damage of work i.e. Rs.9,22,581/- with interest at the rate of 24% from the date of repudiation i.e. 20-07-2007 to till the date;

1. To grant a sum of Rs.50,000/- towards mental agony;

1. To grant Rs.50,000/- towards cost of the litigation;

1. To grant other relief or reliefs as the Honourable Forum deems fit and proper in the circumstances of the case.

2.    The case of the complainant in brief is as under:- The complainant is a Class one Contractor.  He entered an agreement with Government of Andhra Pradesh to form right side flood bank bund of Mamidi Kaluva from 0 Meters to 1200 Meters near Gollapalem Village in Ozili Mandal of Nellore District for Rs.77,97,580/-.  The period of work is from 21-05-2007 to 20-11-2007.  The maintenance period is from 21-11-2007 to 20-11-2009.  The complainant got insured the said work with the opposite party under contractors all the risks insurance policy by paying premium amount of Rs.26,747/-.  The opposite parties issued policy bearing No.051102/44/07/03/6000030.  From 20-10-2007 to 30-10-2007 there were heavy rains in Nellore District due to depressionin Bay of Bengal.  Due to heavy rain fall there was damage to the bunds constructed by the complainant.  There were breaches to the bund.  Immediately the complainant informed the same to the opposite party.  The surveyor appointed by the opposite party No.2 visited the spot and assessed the loss of Rs.6,30,855/-.  The complainant submitted the claim to the opposite parties with all necessary documents.  The opposite parties falsely repudiated the claim stating that the bed of the construction is underneath the water and that the policy covers only dry damages.   The policy issued by the opposite parties is a comprehensive policy. It covers all the risks.  The opposite parties repudiated the claim of the complainant without reasonable cause.   Hence the complaint.

3.     Opposite party No.1 filed counter and the same is adopted by opposite party No.2.  It is stated in the written version of opposite party No.1 that the complaint is not maintainable.  This Forum has no jurisdiction to entertain the complaint.  It is admitted that the complainant obtained Ex.A1 policy bearing No.051102/44/07/03/6000030 from opposite party No.2. In the proposal submitted by the complainant it was noted that the work does not involve wet risks.  Accordingly the opposite party No.2 issued policy by charging appropriate tariff.  After receiving the intimation about the damage, opposite party No.2 appointed a surveyor by name Mr.Zuber.  The surveyor inspected the place and submitted his report assessing the net loss at Rs.3,60,960 – 95 Ps.  Since the loss assessed by the surveyor is less than the policy excess, the claim was not considered for settlement.  The complainant suppressed material facts of the construction of the place of work.  The complainant had not taken immediate care to minimize the loss of property.   The complaint is liable to be dismissed.

4.     On behalf of the complainant Ex.A1 to A9 are marked and sworn affidavit of the complainant is filed.  On behalf of the opposite parties Ex.B1 to B3 are marked and sworn affidavit of the opposite party No.1 is filed.

5.     Both sides filed written arguments.

6.     Now the points that arise for consideration are:

1. Whether there is deficiency of service on the part of opposite parties?

1. Whether the complainant is entitled to the reliefs as prayed for?

1. To what relief?

7.      POINTS 1 and 2:- Admittedly the complainant is a Class one Contractor and he entered into an agreement Ex.A9 dated 16-06-2007 with Government of Andhra Pradesh to form right side flood bank bund of Mamidi Kaluva from 0 Meters to 1600 Meters near Gollapalem Village in Ozili Mandal of Nellore District for Rs.77,97,580/-. The period of work is from 21-05-2007 to 20-11-2007. The maintenance period is from 21-11-2007 to 20-11-2009.  Admittedly opposite party No.2 issued policy Ex.A1 (Ex.B1) covering the risk of contract work of formation of right side flood bank of Mamidi Kaluva from 0 Meters to 1600 Meters near Gollapalem Village in Ozili Mandal of Nellore District.  It is the case of the complainant that there was heavy rain in Nellore District due to depression in Bay of Bengal from 20-10-2007 to 30-10-2007 and due to the heavy rains there was heavy damage to the bunds under construction and caused breaches.  The complainant to show that there were heavy rains from 20-10-2007 to 30-10-2007 in Nellore District relied on Ex.A4 certificate issued by Tahsildar Ozili Mandal of Nellore District.  In Ex.A4 certificate it is clearly mentioned that the entire Nellore District over flowed due to heavy rains received from 20-10-2007 to 30-10-2007.  Admittedly on intimation about the damage, received from the complainant the opposite party No.2 appointed a surveyor by name Mr.Zuber.  The surveyor visited the spot and filed his report Ex.A8.  The surveyor also observed damage caused to the construction work due to floods.

8.     It is the case of the complainant that there was loss of Rs.6,30,855/- due to the floods.  The surveyor assessed the net loss at Rs.3,66,960 – 95 Ps.  Admittedly the opposite party did not pay the said amount to the complainant.  It is contention of the opposite parties that the policy does not cover wet risks and that the opposite partiesare not liable to pay any amount to the complainant.  Admittedly the policy Ex.A1 (Ex.B1) obtained by the complainant is styled as contractors all risks insurance policy.  At this stage the opposite parties cannot escape their liability by merely saying that the policy does not cover wet risks. There is material on record to show that the complainant sustained damage to the work executed by him due to the heavy rains occurred from 20-10-2007 to 30-10-2007.  Ex.B2 is the letter dated 21-04-2009 addressed by the opposite parties to the complainant.  In the said letter it is mentioned that the insurer is not liable to pay any amount to the insured as the policy excess.   The opposite parties while issuing Ex.A1 policy are aware about the nature of the work to be executed by the complainant.  The contract work that was agreed to be executed by the complainant was a formation of flood bank to Mamidi Kaluva. Knowing fully well about the nature of the work to be executed by the complainant the opposite parties issued Ex.A1 policy covering all risks of the contractor.  There is no justification in repudiating the claim of the complainant by the opposite parties.  As already stated the surveyor appointed by opposite party No.2 has estimated the net loss at Rs.3,66,960 – 95 Ps. The report of the surveyor must be given due weight.  The complainant is entitled to the said amount of Rs.3,66,960 – 95 Ps.

9.     In result, the complaint is partly allowed directing the opposite parties jointly and severally to pay an amount of Rs.3,66,960 – 95 Ps with interest at 9% from the date of the complaint i.e., 22-09-2010 till the date of payment along with cost of Rs.1,000/-.

Dictated to the stenographer, transcribed by her, corrected and pronounced by us in the open bench on this the29^th day of August, 2011.

         Sd/-                                             Sd/-                                 Sd/-

MALE MEMBER                      PRESIDENT                 LADY MEMBER

APPENDIX OF EVIDENCE

Witnesses Examined

For the complainant : Nil            For the opposite parties:Nill

List of exhibits marked for the complainant:-

Ex.A1                Policy bearing No.051102/4403/60000030.

Ex.A2.       Letter dated 21-04-2009issued by opposite party No.2.

Ex.A3                Photo copy of loss detailed estimate report by

M.Nagi Reddy Municipal licencedsurveyor.

Ex.A4                Photo copy of certificate issued by Tahsildar, Ozili Mandal,

Nellore District dated 15-02-2008.

Ex.A5                Completion certificate issued by Deputy Executive Engineer

Irrigation Sub-Division Venkatagiri dated 20-5-2009.

Ex.A6                Experience certificate issued Irrigation and C.A.D.

Department.

Ex.A7                Photos along with negatives.

Ex.A8                Photo copy of miscellaneous survey report

dated 31-10-2008.

Ex.A9                Photo copy of agreement between the contractor and

                Superintendent Engineer Irrigation Circle, Nellore

dated 16-06-2007.

List of exhibits marked for the opposite parties:-

Ex.B1        Photo copy of Policy bearing No.051102/4403/60000030.

Ex.B2        Photo copy of letter dated 21-04-2009.

Ex.B3        Photo copy of proposal form dated 21-05-2007 along with postal acknowledgement.

         Sd/-                                             Sd/-                                 Sd/-

MALE MEMBER                      PRESIDENT                 LADY MEMBER

// Certified free copy communicated under Rule 4 (10) of the

A.P.S.C.D.R.C. Rules, 1987//

Copy to:-

Complainant and Opposite parties  :

Copy was made ready on             :

Copy was dispatched on               :