Between

The New India Assurance Company Ltd.,
rep. by its Divisional Manager
Rajahmundry

                                                                Appellant/opposite party

        A N D

Sri Lakshmi Ganapathi Poultries
rep. by its Partner, Kanedu (via
Balabhadrapuram) Biccavole Mandal
East Godavari District.

                                                                Respondent/complainant

Between

The New India Assurance Company Ltd.,
rep. by its Divisional Manager
Rajahmundry

                                                                Appellant/opposite party

        A N D

Sri Lakshmi Ganapathi Poultries
rep. by its Partner, Kanedu (via
Balabhadrapuram) Biccavole Mandal
East Godavari District.

                                                                Respondent/complainant

Counsel for the Appellants            Sri Naresh Byrapaneni

Counsel for the Respondent          Sri P.Ramesh Babu

 QUORUM:                  SRI SYED ABDULLAH, HON’BLE MEMBER

&

                            SRI R.LAKSHMINARSIMHA RAO, HON’BLE MEMBER

                               FRIDAY THE EIGTH DAY OF OCTOBER

                                            TWO THOUSAND TEN

Oral Order ( As per R.Lakshminarsimha Rao, Member)
                                      ***

1.         The appeals are being disposed of by a common order in view of the involvement of common question of fact and law.  F.A.No.1188 of 2008 is taken as the lead case.

2.     The parties are referred to as they have been arrayed in the complaint.  The factual matrix of the case is that the complainant farm is a partnership farm doing poultry business insured 10,872 poultry birds with the opposite party insurance company by paying premium amount of Rs.39,960/-  under comprehensive poultry insurance policy bearing No.476 120 010 1391 dated 5.2.1999 for the period from 5.2.1999 to 22.6.2000.  The policy covers the risk of death of birds due to diseases of various kinds and other perils.  The birds were attacked with a disease for which the complainant got them treated by a qualified veterinary doctor, but 52 birds died on 28.8.1999 and the complainant requested the opposite party insurance company to depute a surveyor to assess the loss.  The complainant has to inform every day the mortality of the birds due to disease to the opposite party insurance company and the opposite party insurance company has to send surveyor to count the dead birds which are required to be burnt in his presence, to prevent and control of the spreading of disease to other birds.  But as per the procedure of the opposite party insurance company, the dead birds are to be kept separately till the surveyor inspected them.

3.     The complainant informed the mortality daily to the opposite party insurance company from 28.8.1999 till 25.9.1999.  The opposite party insurance company did not depute a surveyor on 1.9.2009, 2.9.2009, 3.9.2009, 6.9.2009, 9.9.2009, 13.9.2009, 16.9.2009 and 23.9.2009 due to which the complainant was compelled to keep the dead birds till the arrival of the surveyor.  The dead birds were burnt in the presence of the surveyor.  The disease spread over and the complainant farm sustained heavy loss due to non-deputation of surveyor in time by the opposite party insurance company.  The total number of birds died due to disease during the period from 25.8.1999 to 25.9.1999 was 3254.  The valuation of the birds by the opposite party insurance company is unreasonably less than the actual cost incurred by the complainant.  The surveyors had taken the photographs of the dead birds and also the scene of burning the dead birds.  The complainant lodged claim in the month of October 1999 claiming `2,44,050/- at the rate of   `75/- per bird for the total number of dead birds 3254, but the opposite party failed to process the claim for which the complainant made several representations.  In the month of June 2000, the complainant called for furnishing of irrelevant details to cover up the lapse on its part in settling the claim.  The complainant got issued notice dated 21.9.2000 for which there was no response from the opposite party insurance company. 

4.     The opposite party insurance company resisted the claim.  The issuance of insurance policy for the period from 5.2.1999 to 22.6.1999, the financial facility obtained by the complainant from Andhra Bank, Rayavaram, and the issuance of the insurance policy subject to the usual banker’s lien clause are admitted.  The complainant insured 10872 layers; the date of birth of the birds was 3.2.1999 and the complainant purchased the birds on the date of their birth from C & M Hyline Farmers (P) Ltd.  As per the terms and conditions of the insurance policy, the complainant’s claim is admissible only if the mortality exceeds the limit specified in the policy.  The complainant has not submitted sketch showing the measurement of the shed, structural details and the capacity of each shed/case to the opposite party insurance company. 

5.     As per the terms and conditions of the contract of insurance and as per the established practice in the poultry industry, the complainant must maintain record showing the day to day business affairs of the poultry, details of the feed given to the birds medical attention provided, the medicine used and condition of the birds etc.  The complainant had committed breach of these conditions.  The complainant has not furnished particulars of precautions taken by him to prevent spreading of the disease and reduce the mortality.  As per the terms and conditions of the insurance policy the complainant has to submit weekly mortality reports and immediately inform the opposite party insurance company in case the mortality exceeds prescribed limit and afford an opportunity to opposite party insurance company to inspect the dead birds  which the complainant had not complied with.  The complainant had submitted belated weekly reports full of inaccurate and incomplete particulars.  There was no delay on the part of the opposite party insurance company in deputing the surveyor. 

6.     The complainant had suppressed the truth by withholding the details.  In the absence of the records the surveyors could not submit a comprehensive report giving the full and accurate details.  The complainant made false claim regarding the number of dead birds as of also their value.  The investigator appointed by the oppose party insurance company scrutinized the records maintained by the complainant and found that at the material time there was policy excess.  The opposite party addressed letters dated 30.8.2000, 9.6.2000 and 3.5.2000 with a request for furnishing of particulars sought for therein.  The complainant had not furnished the particulars despite the information in the letters that in the absence of furnishing of those particulars the claim would be treated as no claim.   The opposite parties are not liable to pay any amount or interest @ 24% per annum.  The complainant has no cause of action to file the complaint.  There was no deficiency in service on the part of the opposite party insurance company.  The complaint is not maintainable before the District Forum as it requires enquiry of detailed question of fact.  Hence, prayed for dismissal of the complaint.

7.     The complainant has filed his affidavit.  Exs.A1 to A10 had been marked on his side.  On behalf of the opposite party no affidavit was filed.  The investigation report of Spy Eye though filed was not marked. 

8.     The District forum has allowed the complaint directing the opposite party to pay `2,44,050/- with interest and costs.

9.     Both parties have  filed their respective  written arguments.

10.    The point for consideration is whether the impugned order suffers from misappreciation of fact or law?

11.    The opposite party issued insurance policy on 5.2.1999 covering the life of the birds for the period from 5.2.1999 to 22.6.2000.  The policy, exhibited as Ex.A1 contains a clause that the claim would be admissible only if the mortality in the flock exceeds beyond the limit, 5% of the population in each lot in case of one day old to eight weeks old layers, 3% of the population in each lot in case of the layers within the age group of nine weeks to 20 weeks and 1% of the population in each month for the birds within the age group of 21 to 72 weeks.  The claim of the complainant, as such is governed by the admissibility clause of the insurance policy.

12.    The complainant lodged claim form in the month of October 1999 claiming an amount of  `2,44,050/- for the loss of 3254 birds.  The age of the birds is mentioned in the claim form as 30-34 weeks.  The claim form marked as Ex.A3 is a photocopy and it is not legible.  The death certificate issued by Veterinary Surgeon Anaparthy goes to show that there was death of birds in the complainant farm on 20.8.1999 to 31.8.1999, 1.9.1999 to 9.9.1999, 10.9.1999 to 14.9.1999, 15.9.1999 to 21.9.1999 and 22.9.1999 to 20.5.1999 and the total number of birds dead was 3254.  The death certificate is also a photocopy and is not legible. There would not be any dispute as to the date of purchase of the birds in the light of the pleading of the opposite party insurance company that it had issued the insurance policy on the same date on which the birds were born. 

13.    The opposite party through its letter dated 3.5.2000 sought for the details of  no.1 total number of batches and number of birds in each batch, 2.  date of hatching of the birds for all batches, 3, location of sheds, 4.  the name of insurance company with which the batches were insured, 5.  claims preferred on the batches, 6.  details of postmortem report, 7.  lab investigation report, 8.  Certificate of symptoms of disease observed by the doctor.  In reply, the complainant farm  sent letter dated 10.6.2000 informing the opposite party insurance company that the details of item no.1 to 5 sought for in its letter could not be furnished as the records were sent for auditing.  This letter is also a photo copy and is not legible.  However, with difficulty it could be discerned that the complainant farm expressed its inability that the item no.6 to 8 mentioned in the letter of the opposite party insurance company could not be complied with in view of the submission of the reports to the government.  However, it was stated that the certificate of postmortem examination contains the details of the birds, the disease and diagnosis thereof.  Feeling dissatisfied with the reply of the complainant farm the opposite party insurance company issued reminder on 3.8.2000 reiterating the items of its letter dated 3.5.2000.  After receipt of the reminder from the opposite party insurance company, the complainant farm has got issued notice that the birds were attacked with fowl cholera and the birds started dying from 25.8.1999.  It was stated that 3254 birds worth of `2,44,050/-  died due to the disease and the report of postmortem examination was sent by the complainant and the opposite party had sought for the details which were already furnished by the complainant farm.

14.    The opposite party expressed its inability to entertain the claim  and conveyed its intention through letter 20.3.2001 that its physical verification of the flock revealed that the existing number of live birds were far exceeding the records submitted by the complainant farm which  by itself was violation of terms and conditions of the insurance policy.  Thus, substantial number of birds in excess in the batch was made the basis of the repudiation of the claim. 

15.    The investigator Spy Eye Detective Agency submitted its report to the opposite party insurance company that it had investigated the 16 poultry sheds pertaining to the complainant farm at Kanedu Village of Bikkovle Mandal and after scrutiny of flock records it had stated that the report was submitted to the insurance company.  According to the investigator, the complainant farm lodged two claims on 24.5.1999 in respect of two insurance policies for the mortality occurred during 4.1.1999 to 14.3.1999.  The investigator opined that the number of birds that can be taken into account as dead was 3347 birds.  The investigator had come to the conclusion as to the number of the dead birds as 3,347 after comparing the figures as claimed by the complainant farm.  According to the investigator, number of the birds claimed by the complainant farm is 21,690 of which 19,692 birds were photographed and supported by the surveyor’s report.  10,831 birds found to be actually in excess and as such the number of birds found actually short was 8,861.  The number of birds surveyed by the surveyor’s was 5514.

16.    The investigator had submitted its report after verifying the flock registers of all the sheds, egg production register and feed manufacturing register of the complainant farm and also after making physical verification of the site.  It is an undeniable fact that the complainant farm had the birds in its farm apart from the insured birds.  There was practically an anomalous situation faced by the investigator and the surveyors while assessing the loss actually sustained by the complainant farm in the shape of loss of death of the insured birds.  The investigator had made a factual representation by referring to the number of birds found in excess and those which were not insured but died. 

17.    The complainant has not declared number of uninsured birds which actually crossed the age of insurance.  According to the investigator the age of the birds cannot be identified by making physical verification as to whether it had crossed the age of insurance.  Taking into consideration of the fact that the dead birds included those which was not insured, in view of the opposite party refraining itself from submitting the surveyors’ reports and taking into consideration of the age of the birds and also the incalculable number of dead birds which were not covered by the insurance policy, we assess the value of the claim payable at 50% of the claim.  The amount payable to the complainant farm is   `1,22,020/-.  The learned counsel for the complainant farm relied upon the decision of the Hon’ble National Commission in Vallarupalli Vanaja Vs New India Assurance Company Limited reported in IV (2006) CPJ 94 (NC).  The facts of that case are not similar to the facts of the case on hand.  In that case the age of the birds was categorically mentioned and there was no circumstance where the mixing up of birds covered under the insurance policy and those not covered as also those birds which are alive. Therefore, the decision is not applicable to the facts of the present case. The opposite party insurance company rendered deficient service by not settling the claim despite receipt of the surveyors’ reports and the investigator’s report as well.   

In the result the appeal is allowed in part.  The order dated 5.5.2008 of the District Forum is modified.  The opposite party directed to pay  an amount of    1,22,020/- with interest @ 9% per annum  from the date of complaint till payment along with costs of   2,000/-.  Time for compliance four weeks.

F.A.No.1190 of 2008

In the result the appeal is allowed in part.  The order dated 5.5.2008 of the District Forum is modified.  The opposite party directed to pay  an amount of    98,362.5 with interest @ 9% per annum  from the date of complaint till payment along with costs of   2,000/-.  Time for compliance four weeks.

                                                                    Sd/-

                                                                MEMBER

                                                                    Sd/-

                                                                MEMBER

                                                              Dt.08.10.2010

KMK*