BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD, THIRUVANANTHAPURAM.

PRESENT

SRI. G. SIVAPRASAD                                        :  PRESIDENT

SMT. R. SATHI                                         :  MEMBER

SMT. LIJU B. NAIR                                  : MEMBER

C.C. No. 33/2011 Filed on 02.02.2011

Dated: 30.11.2013

Complainant:

Asharaf. A, Nizam Manzil (Thadatharikathu Puthen Veedu), Kallara, Thiruvananthapuram.

                             (By adv. N. Satheesh Kumar)

Opposite parties:

1. Oriental Insurance Company Ltd., Divisional Office, Jyothi Bazar, Thodupuzha, Idukki.

1. Oriental Insurance Company, Divisional Office, Thakaraparambu Road, Thiruvananthapuram.

1. The Oriental Insurance Company, Registered Office, Oriental House, P.B. No. 7037, A-25/27, Asaf Ali Road, New Delhi-110 002.

(By adv. Varkala B. Ravikumar)

This C.C having been heard on 20.11.2013, the Forum on 30.11.2013 delivered the following:

ORDER

SMT. LIJU B. NAIR: MEMBER

          Complainant purchased a Mahindra Bolero Pickup van with Reg. No. KL 21 B 5403 on 01.01.2010 to carry fish from one place to another.  He spent Rs. 4,76,700/- for the said vehicle apart from the extra fittings.  This pickup van was insured with the 1^st opposite party with policy No. 442600/31/2010/14897 for the period from 01.01.2010 to 31.12.2010.  He paid Rs. 13,272/- under the head own damage claim and 3^rd party liability.  While plying the vehicle along the Kovalam Kazhakkuttom bypass road in the night of 10.08.2010, it met with an accident and the vehicle was totally damaged.  After complying the statutory formalities the vehicle was towed to the authorized workshop of Mahindra M/s T.V.S. Iyengar & Sons Ltd., Thiruvananthapuram for repairs.  The accident was duly reported to the 1^st opposite party.  The service engineers of M/s TVS had inspected the vehicle and prepared an estimate for Rs. 5,35,740/- as the total expenses for repair of the vehicle.  This amount was intimated to the 1^st opposite party also.  On 28.12.2010 1^st opposite party, the insurer of the vehicle issued a repudiation letter alleging violation of policy conditions.  The whole source of income of the complainant and his family members is the amount received from transporting fish from one place to another for sale in the aforesaid vehicle.  They are struggling hard to meet the both ends of life from 10.08.2010 due to the total loss of the vehicle.  Complainant fearing criminal prosecution is paying the monthly installments to the finance company since the blank cheques of the complainant are in the possession of M/s Cholamandalam DBS Finance Ltd. who gave finance for purchasing the said vehicle. Since there is total loss the repudiation of claim without applying its mind is arbitrary and is liable to be set aside.  So he prays for the realization of the insured amount with compensation and costs. 

          Opposite parties entered appearance and filed version jointly.  The existence of the policy for the vehicle bearing Reg. No. KL-21 B 5403 is admitted.  The said vehicle is a goods carriage vehicle and the maximum seating capacity of the said vehicle as per the R.C Book is two including the driver.  The complainant with full knowledge of the fact that carrying more than two passengers including him/the driver in the cabin of the said vehicle amounts to violation of permit and policy condition.  He intentionally violated the policy conditions by using the vehicle otherwise than in accordance with the ‘limitations as to use’ and the overloading of passengers in the cabin resulted in the restriction of the movements of the driver which had prevented him from applying the brake in time resulting in the accident.  So the opposite parties are not liable to entertain the claim or to pay any compensation to the complainant.  If the vehicle was not overloaded, the accident might have been avoided.  The passengers are carried in the vehicle for hire and reward.  They had no relation with each other or the vehicle.  They are not the employees of the complainant.  Carrying passengers other than employees of the complainant amounts to violation of policy conditions and the claim of the complainant deserves to be rejected on this ground also.  The overloading in the cabin is the sole reason for the accident.

          Accident occurred due to the rash and negligent driving of the complainant which includes overloading of the vehicle also.  Moreover the vehicle was used without valid permit thereby intentionally violated the policy condition.  The policy includes policy schedule and the policy conditions attached therein and both the parties are bound by the terms and conditions of the policy.  The liability of the opposite party arises as per the policy conditions and the conditions of the policy are to be strictly interpreted.  So if there is intentional violation of policy condition then no compensation can be awarded.  The averment that the accident was duly reported to the opposite party is false and denied.  The claim form was submitted on 20.10.2010 after a lapse of 70 days.  Complainant was bound to give immediate notice to the opposite parties about the accident.  The inordinate delay in reporting the accident to the opposite parties amounts to violation of condition No. 1 of the policy and the claim deserves to be repudiated on this ground also.  On receipt of the delayed notice of the accident, the opposite party deputed a qualified surveyor to assess the alleged loss and he filed his report also.  But on perusal of documents violation of policy conditions was observed which was the cause for the accident and so the claim was repudiated.  The estimate prepared by M/s TVS is absolutely incorrect and excessive and without any factual or technical justification and is denied.  Without admitting the liability, it is admitted that the total estimated expense for repair of the vehicle is only Rs. 2,41,332.64.  All averments to the contrary are denied.  So the conclusion is that repudiation is on valid grounds and there is no deficiency in service on the part of the opposite party as alleged. 

          Points raised for consideration are:-

1. Whether the complainant is eligible to get the insured amount? If so, up to what percentage?
2. Whether there is any deficiency in service on the part of the opposite parties?
3. Reliefs and costs if any.

Complainant filed chief affidavit along with 5 documents.  He has been examined as PW1 also. Opposite parties have also filed chief affidavit and has been examined as DW1.  An advocate commission was appointed by this Forum to find out the present condition of the vehicle in dispute.  That commission filed a report which is marked as Ext. C1. 

Points (i) to (iii):- The complaint herein is regarding the repudiation of insurance claim.  Policy is admitted by both sides.  Opposite parties repudiated the claim on the reason that there is violation of policy conditions.  Ext. P1 is the motor insurance certificate cum policy schedule.  Ext. P2 is the copy of registration certificate of the vehicle involved in the accident.  Ext. P3 is the copy of FIR filed before Judicial First Class Magistrate Court I.  Ext. P4 is the estimate given by TVS for Rs. 5,35,740/- for repairing the vehicle.  Ext. P5 is the repudiation letter sent by the opposite party.  Ext. D1 is the office copy of the Ext. P1.  Ext. D2 is the final report given before the Judicial fist Class Magistrate Court I. Ext. D3 is the survey report filed by the insurance surveyor, the marking of which has been objected by the complainant on the ground subject to proof. The claim was repudiated on the ground of violation of policy conditions.  Opposite party relies on ‘limitations as to use’ which is there in the policy certificate, that is “Use only for carriage of goods within the meaning of the Motor Vehicle Act. The policy does not cover (i) Use for organized racing, pace-making, reliability trial or speed testing. (2) use whilst drawing a trailer except the towing (other than for reward) of any one disabled mechanically propelled vehicle. (3) Use for carrying passengers in the vehicles, except employees (other than the driver) not exceeding the number permitted in the registration document and coming under the purview of Workmen’s Compensation Act, 1923.  Their case is that only two passengers including the driver is permitted in the vehicle which was registered as LMV goods carriage.  Opposite party alleges that there were altogether 4 persons in the vehicle at the time of accident which includes the driver also.  The case of the opposite party is that by overcrowding, the driver cannot apply brake at the correct time and so the accident happened.  In his deposition complainant himself admits that there were 4 persons in the vehicle at the time of accident, two persons were inside the cabin and two were behind.  He deposed that he is ignorant of the fact that vehicle is permitted to carry two persons only.  He was asked a specific question whether he had any time for applying the brake at the time of the accident, for which he replied that when the vehicle which was going in front of him suddenly turned he got no time to apply the brake.  So the contention of the opposite party that the complainant cannot apply brake at the right time due to overloading will not sustain.  Also in Ext. D3 survey report in the remarks column the surveyor states that the proximate cause of the alleged accident is mere skidding of the vehicle when applying sudden brakes in good speed with overload and no third party was involved.  At the time of accident 4 persons including driver was in the insured vehicle.  They were carrying fish also.  But they do not have a case that all the four persons were sitting in the cabin.  So that contention is also not sustainable.  Admittedly, there is violation of policy condition.  Whether that violation of policy condition is simple or fundamental one is the only question to decide.  Opposite party do not have a case that the driver is not having a valid driving license.  Complainant in his deposition also admits that he is having a valid driving license with badge to drive the vehicle of that kind.  They are relying on the conditions under the title ‘limitations as to use’.  Regarding the same, to substantiate their stand, opposite party filed several decisions from National Commission, but in view of the decision produced by the complainant from the Supreme Court of India wherein the question of violation of policy conditions regarding vehicle insurance is discussed in length and found that even assuming that there was breach of conditions of the insurance policy, which is not fundamental in nature, the insurance company ought to have settled the claim on non-standard basis.  Moreover National Commission had set up the guidelines for settlement of non-standard claims in which they issued guidelines as “whether the breach is material to the loss or where an act of the insured or his agent has contributed to such a breach in such cases if the insured has acted with the best of intentions and has not consciously committed the breach or where the legal questions of liability is in doubt, payment may be considered on merits of each case, upto a maximum of 75% of the assessed amount of loss”.  Again in overloading of vehicles beyond licenced carrying, National Commission set up the guidelines as to pay claims not exceeding 75% of admissible claim capacity.  Here the claim has been repudiated on the ground of violation of policy conditions.  We are of the considerate view that violation herein is not a fundamental one in nature.  It is a simple one.  So the claim can be settled on non-standard basis as per guidelines put forth by Hon’ble Supreme Court and National Consumer Disputes Redressal Commission.  Now we have to decide the quantum for settlement.  Here the vehicle in dispute sustained total loss.  It is beyond repair.  So the complainant is eligible to get 75% of the insured amount as per the guidelines issued by the Apex Courts.  Here the vehicle was insured for Rs. 4,52,865/- as per Ext. P1.  So the complainant is eligible to get 75% of the insured amount as full and final settlement of his claim on non-standard basis, i.e Rs. 3,39,648/-.  Considering the overall situation, there is no order on cost and compensation.

In the result, complaint is allowed in part.  Opposite parties are directed to pay the complainant Rs. 3,39,648/- (75% of the insured amount i.e; Rs, 4,52,865/- as per Ext. P1) within a month of receipt of this order.  After this period, 9% interest is ordered till the date of realization.  On receiving this amount, complainant is directed to handover the vehicle to the opposite parties. 

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room. 

          Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Forum, this the 30^th day of November 2013.

Sd/-

LIJU B. NAIR                : MEMBER

                                                                   Sd/-

G. SIVAPRASAD                   : PRESIDENT

Sd/-

R. SATHI                      : MEMBER

C.C. No. 33/2011

APPENDIX

  I      COMPLAINANT’S WITNESS:

          PW1  - Asharaf

 II      COMPLAINANT’S DOCUMENTS:

          P1     - Motor insurance certificate cum policy schedule

          P2     - Copy of registration certificate of the vehicle

          P3     - Copy of FIR filed before Judicial First Class Magistrate Court I.

          P4     - Estimate given by TVS for Rs. 5,35,740/- for repairing the vehicle.  

P5     - Repudiation letter dated 28.12.2010 sent by the opposite party.    

III      OPPOSITE PARTY’S WITNESS:

          DW1 - R. Sreenivasan

 IV     OPPOSITE PARTY’S DOCUMENTS:

          D1     - Office copy of Ext. P1

          D2     - Copy of final report given before the Judicial First Class Magistrate

                      Court I.

          D3     - Survey report filed by the insurance surveyor.

  V     COURT EXHIBIT

          C1     - Commission Report

                                                                                                           Sd/-

PRESIDENT

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