BEFORE THE DAKSHINA KANNADA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, MANGALORE

Dated this the 30^th of September 2011

PRESENT

        SMT. ASHA SHETTY           :   PRESIDENT

                        SMT.LAVANYA M. RAI       :   MEMBER                                      

COMPLAINT NO.27/2010

(Admitted on 23.01.2010)

Sri.Jayanth R. Salian,

So. Ramappa Poojary,

Aged about 51 years,

Residing Near Koppal House,

Iddya, Surathkal, Mangalore.            …….. COMPLAINANT

(Advocate for the Complainant: Sri.S.K. Ullal).

          VERSUS

The Divisional Manager,

United India Insurance Co. Ltd.,

Post Box No.29,

Shrinivas Complex, 1 Floor,

Ananthashayana Road,

Karkala.                                         ……. OPPOSITE PARTY

(Advocate for the Opposite Party: Sri.Divakar Bangera).

                                      ***************

ORDER DELIVERED BY PRESIDENT SMT. ASHA SHETTY:

1.       This complaint is filed under Section 12 of the Consumer Protection Act alleging deficiency in service against the Opposite Party claiming certain reliefs. 

The brief facts of the case are as under:

The Complainant is the owner of the boat ‘PUSHPAK’ bearing registration No.F-MNG 1106 and KDT No.1657 insured with the Opposite Party for a sum of Rs.9,00,000/-as per the Marine Hull Insurance Policy bearing No.240503/22/08/01/00000009 valid for the period from 08.03.2009 to 07.06.2009.  It is stated that, on 02.05.2009 after closing the fishing activities in Arabian sea, the above said boat was returning to Mangalore South Wharf for unloading the fish catch.  While passing through the Mangalore sea bar around 8 to 8.30 p.m on account of the problem in steering wheel chain, the said boat’s tindel lost control over the boat, inspite of his best efforts to protect the boat, drifted towards the sand bund and the stone boulders on the bank of the Mangalore sea bar and suffered extensive damage to the bottom part of the boat.  As a result, the sea water started gushing in.  Immediately Complainant’s said boat’s crew and the tindel started flush out the water.  Inspite of their best efforts they could not flush out the water, as the incoming water force was more.  They found that it was dangerous to continue to be in the stranded boat as it suffered extensive damage also.  So in order to save the life of the crew from the danger they cried for help and on hearing their cries and the condition of the boat, a boat by name ‘Varadambika’ which was proceeded nearby rushed to the spot and saved the crew of the Complainant’s boat and also tried to pull the stranded boat.  When they failed in their attempt, another boat ‘Rohan’ and both the boats tried to pull Complainant’s boat which was in dangerous condition, they succeeded to bring the damaged boat to Hoige Bazar Gurudev Yard at about 11.30 p.m. 

Immediately thereafter the Complainant had reported the same to the Opposite Party and also the concerned authorities including the police.  The Opposite Party deputed the Surveyor to the said yard where the damaged boat was brought to haul up.  As per their advice and direction the Complainant had hauled up the said boat in Gurudev Boat building yard of Hoige Bazar.  It is stated that, in order to repair the said boat, the Complainant had approached the repairer and got the damaged boat inspected.  The repairer after personal inspection, had estimated the cost of repair of the Complainant’s boat at Rs.13,00,000/- which fact has been informed to the Opposite Party and submitted all the required documents for speedy settlement of his claim.

It is stated that, thereafter the Complainant frequently visited the office of the Opposite Party and gave full co-operation for settlement and submitted as and when any document was sought by the Opposite Party but the Opposite Party did not settled the claim.  It is further stated that, the cost of the repair of the said boat estimated at Rs.13,00,000/- which is more than the sum insured i.e., Rs.9,00,000/- hence it is a constructive total loss and the Complainant is entitled for the full insured amount.  It is also stated that, since the boat is extensively damaged and it is impossible to repair out of the insured sum, he gave the notice of abandonment on 27.06.2009 to the Opposite Party requesting them to take possession of the wreck of the said boat by fixing salvage the salvage amount but the Opposite Party not taken any action with regard to the abandonment notice nor settled the claim.  On account of the non-settlement of the claim, the Complainant has been put to loss, hardship and inconvenience and stated that the action of the Opposite Party amounts to deficiency and filed the above complaint under Section 12 of the Consumer Protection Act 1986 (herein after referred to as ‘the Act’) seeking direction from this Forum to the Opposite Parties to pay the insured sum of Rs.9,00,000/- along with interest at 18% p.a. from 02.05.2009 to 31.12.2009 and also claimed Rs.1,01,000/- as compensation and cost of the proceedings.

2.       Version notice served to the Opposite Party by RPAD. Opposite Party appeared through their counsel filed version submitted that, there is no deficiency in service and took a contention that, the Complainant is not a consumer and there is no consumer dispute and this FORA has no jurisdiction to entertain the complaint.  And further stated that, the aforesaid boat was insured with the Opposite Party as per the terms of the Marine Hull Insurance Policy and the said policy is valid from 08.03.2009 to 07.06.2009.  The Opposite Party after receipt of the intimation of the alleged accident, they have deputed the Surveyor and Loss Assessor Mr.Janardhan Heble.  It is submitted that, the Surveyor has visited the spot where the vessel was lying on 04.05.2009 and inspected the vessel said to be involved in the alleged accident.  The Surveyor advised the Complainant to haul up the vessel immediately for further detailed inspection and assessment of loss but the Complainant not hauled up the vessel, the vessel was still lying there on the spot and it is further stated that, the Complainant has totally neglected the advises of the Surveyor and allowed the vessel to undergo further damages by half dragging the vessel towards the shore side. 

          It is again submitted that, as per the terms and conditions of the Marine Hull Policy, it is one of the primary duties of the Complainant to take all pre-emptive steps needed to save the boat from causing further damages to the insured vessel as if the same is not insured and to safeguard the boat with all its accessories until his claim is admitted.  The Surveyor repeatedly requested the Complainant to haul up the vessel safely and asked the Complainant to produce the documents to enable the Surveyor to proceed further but the Complainant not produced the material documents either to the Opposite Party or to the Surveyor to substantiate his claim.  The Opposite Party and Surveyor repeatedly demanded for production of relevant documents and asked the Complainant to co-operate with the Surveyor with the necessary information but the non-co-operation of the Complainant made the Opposite Party as well as the Surveyor to finalize the survey work and loss assessment.  It is stated that the important documents were not produced to the Surveyor as well as to the Opposite Party in this case.  The Complainant without following any of the claims procedure, acted against the rules and conditions of the policy.  In view of the non-compliance of the requirements/ documents by the Complainant the surveyor is unable to finalize the survey report.  It is stated that, the Opposite Party had immediately and promptly acted on the intimation received from the Complainant by arranging survey for assessment of loss, there is no deficiency on the part of the Opposite Party and prayed for dismissal of the complaint. 

3.       In view of the above said facts, the points now that arise for our consideration in this case are as under:

1. Whether the Complainant is a consumer and whether this FORA has jurisdiction to entertain the complaint?

2. Whether the Complainant proves that the Opposite Party has committed deficiency in service?

3. If so, whether the Complainant is entitled for the reliefs claimed?

4. What order?

4.         In support of the complaint, Sri.Jayanth R.Salian (CW1) filed affidavit reiterating what has been stated in the complaint and answered the interrogatories served on him.   Ex C1 to C29 were marked for the Complainant as listed in the annexure.   One Sri.P.Venkataprasad (RW1), Administrative Officer of the Opposite Party filed counter affidavit and answered the interrogatories served on him. One Sri.Janardhan Heble (RW2) – General Insurance Surveyor, Loss Assessor and Valuer of the Opposite Party filed affidavit and answered the interrogatories served on him.   Ex R1 to R5 were marked for the Opposite Party as listed in the annexure.   Both parties produced notes of arguments along with citations.

          We have considered the notes/oral arguments submitted by the learned counsels and also considered the materials that was placed before this Forum and answer the points are as follows:                          

                       Point No.(i): Affirmative.

                       Point No.(ii) to (iv): As per the final order.

Reasons

5.  Point No. (i):

In the instant case, the 1^st point raised by the Opposite Party is that the ‘Complainant is not a consumer’.  The above contention cannot be considered as the Policy was taken for reimbursement or indemnity for loss which may be suffered due to various perils.  No question of trading or carrying on commerce involved in any insurance policy.  Contract of Insurance generally belongs to general category of contract of indemnity – services may be for any connected commercial activity, yet it would be within the purview of Act.  The Hon’ble National Commission held that, “Hiring of services of Insurance Company by Complainants who are carrying on commercial activities cannot be held to be a commercial purpose [reported in I (2005) CPJ 27 (NC)]; M/s Harsolia Motors versus National Insurance Co. Ltd. 

The above observation made by the Hon’ble National Commission also lends support to the view which we have taken.   That the policy is taken for indemnifying the loss and not for commercial purpose.  Hence the Complainant is a consumer and the complaint is maintainable and point No.(i) held in favour of the Complainant.

Point No. (ii) to (iv):

 Rest of the points are concerned, the Complainant is the registered owner of the boat ‘PUSHPAK’ bearing registration No.F-MNG 1106 and KDT No.1657 and carrying on the fishing activities at Bunder, Mangalore.  It is also admitted that the said boat was insured with the Opposite Party under the policy No.240503/22/ 08/01/00000009 valid for the period from 08.03.2009 to 07.06.2009 for a sum of Rs.9,00,000/- (as per Ex C2).  Further it is admitted that the subject accident to the boat caused on 02.05.2009 which was during existence of the policy.

Now the points in dispute between the parties before this FORA is that, according to the Complainant there was an accident on 02.05.2009.   On the above said day after closing the fishing activities in Arabian Sea the Complainant’s said boat was returning to Mangalore South Wharf for unloading the fish catch while passing through the Mangalore Sea bar around 8.00 to 8.30 p.m.  On account of the problem in steering wheel chain the said boat’s tindel lost control over the boat inspite of his best efforts to protect the boat drifted towards the sand bund and the stone boulders on the bank of the Mangalore Sea bar and suffered extensive damage to the bottom part of the boat.  As a result, the sea water started gushing in and they could not flush out the water as the incoming water force was more and they found that it was dangerous to continue to be in the stranded boat as it suffered extensive damage.  With the help of the other two boats by name ‘Varadambika’ and ‘Rohan’ succeeded to bring the damaged boat to Hoige Bazar Gurudev Yard at about 11.30 p.m. and thereafter they reported the accident to the Opposite Party as well as to the concerned authorities including the police but the Opposite Parties not settled the claim.  Hence came up with this complaint.

On the other hand the Opposite Party interalia contended that, the Surveyor has visited the spot on 04.5.2009 where the vessel was lying and inspected the vessel involved in the alleged accident and the Surveyor advised the Complainant to haul up the boat immediately but the Complainant allowed to lying on the same place even during the 4^th visit of the Surveyor and neglected the advises of the Surveyor and allowed the vessel to undergo further damage.  Apart from the above contention, it is stated that the Complainant not produced the relevant / material documents either to the Opposite Party or to the Surveyor to substantiate his claim.  The Opposite Party and the Surveyor has repeatedly demanded for production of relevant documents and requested the Complainant to co-operate with the Surveyor with necessary information pertaining to the damaged vessel to process the claim but the Complainant not co-operated.  Hence, according to the Opposite Party Company the claim could not be finalized because of the non-compliance of the required documents by the Complainant and contended that there is no deficiency.

The Complainant filed oral evidence by way of affidavit and produced Ex C1 to C29.  Opposite Party also filed oral evidence by way of affidavit of RW1 i.e., the Administrative Officer of the Opposite Party and RW2 i.e., the General Insurance Surveyor, Loss Assessor and Valuer of the Opposite Party and produced Ex R1 to R5.

On scrutiny of the oral as well as documentary evidence and admitted facts available on record, we find that both the parties admitted that the Complainant is the registered owner of the above said boat and the said boat was insured with the Opposite Party for the period from 08.03.2009 to 07.06.2009 and during the subject accident the policy was in force. 

On perusal of the version filed by the Opposite Party Company as well as survey report, we noticed that there is no specific denial of the accident to the above said boat and also there is no dispute about the fact that the accident was not reported to the Opposite Party or the concerned authorities including the police from the Complainant.  But the only contention is that the Complainant not produced the material documents either to the Opposite Party or to the Surveyor to substantiate the claim and stated that the Complainant not hauled up the vessel immediately but allowed to lying on the same place despite of the advises of the surveyor and allowed the vessel to undergo further damage.  However, it is admitted fact that the Opposite Party Company deputed the Surveyor by name Sri.Janardhana Heble in this case and the Surveyor submitted his report dated 23.04.2010 i.e., Ex R2 before the Company.   Admittedly the accident was caused on 02.05.2009 at around 8.00 to 8.30 p.m., that the Surveyor visited the spot on 04.05.2009 for inspecting the vessel but there is no interim report with regard to the alleged survey conducted by him at the spot immediately after his initial visits to show that the Complainant allowed the vessel to undergo further damage and we also noticed that the Surveyor submitted the report almost after a year i.e., on 23.4.2010.  

Further, we find that, the Opposite Party Company in para No.8 of their version specifically stated that the Surveyor visited the spot four times to see the boat and stated that the Complainant was not hauled up the vessel and thereby caused further damage to the vessel.  But there is no interim report as stated supra by the Surveyor in this case to show that he had visited four times and despite of his advise the Complainant was neglected to haul up the vessel and thereby the vessel undergone further damage as contended by the Opposite Party.  We feel that, the Surveyor should have drawn the interim report at the spot in ‘as it is where it is condition’ to substantiate that the vessel undergone further damage because of the complainant.  But no such material evidence available in this case which is fatal.

Further, our attention was drawn towards the production of documents sought by the Opposite Party Company as well as the Surveyor in this case.  Now the point arises, whether the documents sought by the Surveyor / Opposite Party Company is relevant to consider the claim?  The answer is ‘negative’.  Because the Opposite Party Company has failed to justify the case by producing material evidence to show that the production of the documents sought by them is relevant. There are voluminous documents demanded by the Surveyor that has been reproduced herebelow:-

1. Claim form duly filled in all respect and signed by the owner.
2. Bills of repairs carried out of the said vessel prior to above accident.
3. Copy of the diesel purchase pass book along with the original for verification.
4. Diesel purchase bills for a period of at least 3 months immediately prior to the date of alleged accident.
5. The bills of fish catches/sales for the last three months.
6. Weather report as on the date of accident obtained from Meteorological Centre, Chennai.
7. Production of all crew members who were on board on the date and time of the alleged accident for interrogation and recording their statements along with the crews of rescuing boats and hauling up contractor.
8. Copies of the R.C and diesel pass books of rescuing boats.
9. Statements of loan account maintained in the name of the boat from the financiers if any.
10. Estimate towards repairs/replacement of parts.

          The above stated documents were demanded by the Opposite Party as well as the Surveyor in their correspondences dated 05.06.2009, 27.05.2009, 14.07.2009, 29.07.2009, 07.09.2009, 08.09.2009, 14.09.2009, 23.09.2009 and 28.09.2009 i.e., Ex C10, C12, C14, C16, C19, C20, C22, C23 and C24.   we find that, the Complainant submitted the endorsement issued by the police department i.e., Ex C7, Spot mahazar i.e., Ex C8, findings of the enquiry officer/port officer, old port office Mangalore regarding the marine casualty of above said boat and letter issued by the Port Officer, Registrar of Indian Fishing Boats Mangalore to the Mercantile Marine Department Cochin dated 06.01.2010 i.e., Ex C28 and C29.  The above documents made clear that, the above said boat was ventured to sea for three days fishing on 30.04.2009, while coming back on 02.05.2009 towards fishing harbor near entrance sand bar boats steering chain broken and fishing boat went on uncontrolled direction and hit the sand bar and rock.  Then the bottom portion of the fishing boat was broken, by this gap huge sea water gushed in the boat and boat becomes started drifting in the sea.  It is further seen in the findings of the enquiry port officer that the crew was emptied the fish catch from the holds and called nearby passing fishing boats to help and two boats by name ‘Varadambika’ and ‘Mathsyraj (Rohan)’ rescued the crew and fishing boat also towed in the drifted condition near shore at Hoige Bazar while removing the boat all wooden planks loosen and irreparable condition.  The above observation was made after the enquiry of the owner/tindel and rescue boat tindels at their office and recommended for closure of registry under the Merchant Shipping Acts.  And further, the Department of Ports and Inland Water Transport Government of Karnataka recommended the above boat for further action.  The above two documents produced by the Complainant are sufficient to hold that the above said boat met with an accident while engaged in fish catch steering chain broken and boat went uncontrolled direction and hit the sand bar and rock, the bottom part was broken by this gap water gushed and the boat towed in drifted condition, there is no contra evidence produced by the Opposite Party Company to disprove the same. 

Now we have taken up the discussion with regard to the documents sought by the Opposite Party Company / Surveyor in detail one by one as follows:- 

          The document No.1 i.e., the claim form sought by the Surveyor.  We are very strange to note that only after submission of the claim form the Opposite Party Company would depute the Surveyor and not before.  When the Opposite Party Company holding the original claim form what is the point in demanding the above document from the Complainant once again. 

          Further in point No.(g) the Surveyor demanded the Complainant to produce all crew members who were on board on the date and time of the alleged accident for interrogation and recording their statements along with the crews of rescuing boats and hauling up contractor.  As far as this point is concerned, as we know the Surveyor is deputed only to inspect the damage of the boat and assess the loss ‘as is where is condition’ and submit the report.  It is not the case of the Opposite Party Company that because of the non-production of the documents the Surveyor could not assess the damage as is where it is condition.  It is admitted by the Company as well as Surveyor that, he visited the spot for four times, when that being so, the Surveyor should have interrogated the tindel, crew members or should have drawn a mahazar at the spot itself.  But no such attempt was made by the Surveyor.  When the Surveyor visited four times to the spot, definitely he should have drawn an interim report and should have obtained a statement of the tindel, crew members etc. etc in order to substantiate their averments at the earliest stage.  It is the definite case of the Complainant that the above said boat met with an accident and extensively damaged and he cannot use the boat.  Admittedly, the Surveyor did not record the statement of the crews and tindels or any independent witness at the spot of the accident or at the spot where the wreckage was hauled up.    It is seen that, Surveyor addressed a letter dated 27.05.2009 i.e., after 25 days of the accident to produce the crews and tindels of the Complainant’s boat before him (as per Ex C12).  But in the said letter the Surveyor has not fixed a particular day or venue for producing the crews and tindel for interrogation.  It is seen that, the Surveyor’s office is situated not in Dakshina Kannada District but in Udupi District.  The crews and tindels from Mangalore have to go all the way from Dakshina Kannada District to Udupi District.  However, the Complainant in their reply letter dated 27.06.2009 i.e., Ex C13 informed the Surveyor that crews and tindels not available and requested them to fix date and time when they could come and record the statement of the available crews and tindel at Mangalore where some of the aforesaid crews and tindels were working.  The reply given by the Complainant was definitely reasonable because once the boat is extensively damaged, the crews and tindels are not continuing their job with the Complainant that they will go in search of the jobs to eke out their livelihoods.  Obviously, it is very difficult to get the crews and tindels according to the Surveyor’s convenience.  But in the instant case, the Surveyor or the Opposite Party Company failed to appreciate that the Complainant has expressed his willingness to produce the available tindels and crews if they fix the time and date.  It is seen that, the Surveyor admittedly visited the spot of the accident on 04.05.2009 and advised the Complainant to take steps to haul up the boat.  Except giving direction, the Surveyor neither conducted the investigation into the reported accident nor interrogated the crews/tindels of the Complainant’s boat or rescuing boat who were very much present at that time.  Therefore, non-production of the tindel and crews before the Surveyor’s office which is situated outside the District i.e., also after 25 days from the date of accident is not the justifiable ground for rejection of the claim.  It is further seen that, the correspondences between the Complainant and the Surveyor is very much clear that the Complainant had responded to each letter of the Surveyor and the Opposite Party reiterated his stand with regard to safe keeping wreckage and abandonment whenever and wherever the co-operation was sought by the Surveyor of the Opposite Party.  The Surveyor appointed in this case cannot expect each and every document should be presented by the Complainant without there being any weight to the said documents.

However, the Opposite Party contended that, the repair bills are required to see that whether the boat has been maintained periodically from the date of valuation by the Surveyor till the date of accident.  It is admitted that the boat was valued on 07.09.2008, the subject accident took place on 02.05.2009 i.e., after 8 months of the valuation.  That means, the boat was valued on 07.09.2008 and at that time the Opposite Party Company admitted the seaworthiness of the boat and issued the policy covering the period from 08.03.2009 to 07.06.2009. The Opposite Party Company issued the said policy basing on the Surveyor’s valuation report and personal inspection by them with regard to the seaworthiness.  When that being so, the question of insisting the repair bill before the accident does not arise.   Even though the Complainant in his letter i.e., Ex C13 made it clear that, those earlier bills were lost at the time of accident.  Just because the repair bills are not produced the Opposite Party cannot contend that the boat is not in seaworthy condition until and unless the contra evidence produced before this FORA. 

Further, with regard to the registration certificate the Opposite Party contended that those documents are necessary.  But the Ex C28 and C29 i.e., the enquiry held by the Port Officer ordered to cancel the registration certificate hence the question of producing registration certificate doesn’t arise.  

As far as loan particulars are concerned, it is not mandate that one has to obtain a loan.  If the Complainant’s boat was not hypothecated to any bank, then the question of obtaining the loan statement in this case does not arise.  One has to see that whether these documents helping the Opposite Party Company to repudiate the claim.  When the Complainant made it clear that, the boat was not mortgaged or charged against any loan, the question of producing the said loan statement does not arise and if at all the boat hypothecated, the policy finds a place in it. 

In view of the above discussions, we are of the considered opinion that the documents sought by the Surveyor are not necessary to consider the claim of the Complainant.

It is further seen that Ex C9 and C11 are the abandonment notices dated 25.05.2009 and 27.06.2009 issued by the Complainant to the Opposite Party, wherein, it is specifically stated that the boat ‘Pushpak’ has suffered extensive damage and the same was hauled up in a boat building yard and on account of his financial position and personal inconvenience to protect the said wreckage, requested the Opposite Party to take possession of the same.  The above abandonment notices were served to the Opposite Party but it is seen that no steps were taken by the Opposite Party in this case.  It is pertinent to note that, the Complainant expressed his difficulties by issuing abandonment notices, when that being the case, Opposite Party should have taken physical possession of the boat.  Atleast after receipt of the abandonment notices the Opposite Party Company should have taken possession of the boat.  But in the instant case, no such steps were taken instead of that the Opposite Party Company came up with a version stating that Complainant has not produced the documents/not co-operated the Surveyor etc. etc. cannot be accepted. Just because the Complainant not produced the documents which are not in possession of the Complainant, the claim of the Complainant cannot be denied.  In the instant case, it needs to be appreciated that the documents sought by the Opposite Party Company is not at all relevant to withhold the claim.  The finalization of the claim of the Complainant is not depending upon the production of such documents.  The Insurance Company could obtain by the investigator from the concerned persons who may be Government servant in discharge of their duties.  Viewed in the light of the above discussion, we find that the documents sought by the Surveyor as well as the Insurance Company is not at all relevant to consider the claim but on the other hand the Opposite Party Company in the guise of production of documents withheld the claim of the Complainant by raising a contention that the Complainant not co-operated nor produced the documents.    

With regard to the crew/tindel report, we have already discussed in detail but on overall taking into consideration of the defence taken by the Opposite Party Company i.e., the Complainant not produced the documents and hence they are unable to conclude the survey report cannot be considered in this case.

As far as damages of the boat is concerned, we have observed that, the Complainant has cancelled the registration of the subject boat during the pendency of the case and the cancellation is affected on 21.07.2010. According to the Opposite Party Company, the engine and accessories, gear with net and accessories worth Rs.3,00,000/- were intact and stated that the repairs will always exaggerate the repair estimate and they just give a quotation and it is not the final settlement.  No doubt, the Complainant produced the repair estimate before the Surveyor, it is the Surveyor who has to assess the damage irrespective of the documents sought by him.  But in the instant case, the Surveyor has decided and gave his opinion that the alleged damaged boat is repairable and recommended for repair were not agreed by us.  However, we have perused the survey report, wherein, the Surveyor stated that, at the instance of the Opposite Party Company he visited the spot on 04.05.2009 at about 16.00 hours in order to investigate the reported damage and assess the damage/loss and estimate the repair/replacement cost.  Admittedly, the accident took place in the year 2009 i.e., on 02.05.2009 but the alleged survey report was drawn on 23.04.2010 i.e., almost nearly one year.  In his report page No.2 he has narrated the ‘background of the incident’ and in page No.3 he has narrated his ‘inspection/survey’, wherein he has stated that, he visited the river bank of Hoige Bazar, Mangalore on 04.05.2009 and found the insured boat in half-submerged condition with its bottom touching the river bed, he has advised the Complainant to arrange for a canoe to go near the insured boat and climb into it and asked to re-float the insured boat and haul it up in order to avoid further damage and it is further stated that, he had visited the spot on the very next day, even at that time it was not hauled up, according to the Surveyor, on 08.05.2009 the boat was hauled up and the engine dismantled kept for further inspection and thereafter the entire survey report talking about the documents and also interrogation of the crew members stating that the Complainant not produced the documents and not produced the crew members etc. etc.  In page No.4 of his report in last para he had stated that, without the cross-interrogation of all the crew members, he is not in a position to confirm whether the damage noted down by him from the sub-merged boat falls within the perils covered or not.  The Surveyor should not forget that, he is an expert deputed for assessment of the repair cost of the damaged parts and note the damaged parts and not otherwise.  Instead of noting the damaged parts and discussing about the repair cost mentioned by the repairer, he has expressed his inefficiency and given more credence to the documents.  That itself shows that, the Surveyor not properly assessed the boat.  However, the following damages were noted:-

1. The entire cabin broken – Required renewal.
2. The hull frames on the starboard side broken/developed crack/bent inward above the deck level from the fore part through the amidships to the aft – required renewal to a length of 4’ (size:4’ X 4” X 4” X 45 Nos = 19.60 cft.)
3. The hull frames broken/developed crack/bent inward on the port side above the deck level from part to aft – required renewal (Size: 4’ X 4” X 4” X 45 Nos = 19.60 cft.)
4. 4 nos. hull planks on the either side above the lower fender broken/developed crack – required renewal (Size: 50’ X 8” 1 ½” X 8 Nos. = 33.5 cft.)
5. The upper and lower fenders broken/developed crack at places and the remaining fenders had to be removed to facilitate the replacement of hull frames and since the same would break/develop crack during dismantling their renewal would be warranted (Size:  50’ x 8” x 2” x 4 Nos. = 22.78 cft.).
6. The upper railing and railing stanchions on the either side broken/developed crack at places and the rest of them were also to be removed to facilitate the replacement of hull frames and as the same would break/develop crack during dismantling, their renewal would be called for (Size: 50’ x 10” x 1 ½” x 4 nos. = 20.83 cft).
7. The deck edge planks on the either side had to be removed to facilitate the replacement of hull frames and their possible breakage/cracking during dismantling would required renewal (Size: 50’ x 10” x 1 ½” x 2 nos. – 10.37 cft.)
8. The FRP had to be laminated on the either side of the deck edge planks once the replacement of hull frames are over to an area of 50’ X 1.5’ X 2 sides = 150 sq. ft.
9. Given that the cabin has been broken in its entirety, the wiring had to be done afresh.
10. Saline water entered into 2 Nos. acid battery – Required renewal.
11. The engine, gear box, cranking motor, FRP, dynamo – swamped by the saline river waters had to be overhauled immediately with necessary packings, seals etc. 

It is opined by the Surveyor that, having made no proper arrangements to refloat the insured boat from its submerged position and haul it up, the insured had the entire boat dragged up by a conventional device (Gaana) where the wooden beams fitted to a vertical axis (attached as it were to the boat with a rope) would rotate clockwise and do the job, but let the lower part of the hull get exposed to more damage. As a result, most of the hull frames had given way at their fastened joints – rendering the hull totally irreparable.  Thus, according to the Surveyor the damage caused due to the negligence of the insured wherein the boat was being deliberately dragged along before it was being refloated would not become the liability of the underwriters nor does it fall within the scope of the perils covered under the issued policy.  The above damage according to the Surveyor caused due to the negligence of the insured, the boat was being deliberately dragged along before it was being re-floated, would not become the liability of the underwriters nor does it fall within the scope of the perils covered.  But we have noted that, the Complainant was asked to haul up the boats, the documents produced by the Complainant i.e., Ex C28 and C29 made us clear that the above said boat was ventured to sea for three days fishing, while coming back towards fishing harbour near entrance sandbar, boat’s steering chain broken and fishing boat went on uncontrolled direction and hit the sandbar and rock.  The bottom portion of the fishing boat was broken by this gap huge sea water gushed in the boat and boat becomes started drifting in the sea, we also noticed that the fishing boat towed in the drifting condition near the shore at Hoigebazar, while removing the boat all wooden planks loosen and irreparable condition.  When that being so, we cannot consider that the boat was being deliberately dragged before it was being re-floated and the damage was caused due to the negligence of the insured.  There is no material / credible evidence available on record to substantiate the Surveyor’s report.  No prudent man will deliberately drag the boat.  The duty of the Surveyor is to note the damage and assess the repair cost.  If at all, the damage was not a direct consequence of the alleged accident, the Surveyor should have noted in his report.  But in the instant case nothing has been mentioned in the survey report.  In the remarks column the Surveyor stated that he has reasonably assessed but there is no material produced to show that on what basis he has assessed the same, he had made bald statement in his report that boat is repairable.  No basis for reaching such conclusion or any material regarding his enquiries in the market has been furnished.  This is arbitrary. At the outset we constrained to observe that assessment made by the Surveyor unjustifiable.  No justification to assess the loss on assumption and presumption.  The finding given by the Surveyor contrary to the policy.  Hence, the survey report partly set-aside as far as the assessment of the damage is concerned.   The Opposite Party is liable to pay full value of the boat. 

However, we noted that, the repairer estimated the cost of the repair was of Rs.13,00,000/- which is more than the actual value of the boat.  If the estimated cost of the repair exceeds the actual value of the vessel, it is deemed to be a constructive total loss under Section 60 of the Marine Insurance Act. 

However, the Section 60 of the Marine Insurance Act is re-produced here below for better appreciation:-

“(2) In particular, there is a constructive total loss –

(ii) In the case of damage to a ship, where she is so damaged by a peril insured against that the cost of repairing the damage would exceed the value of the ship when repaired…….”.

The above provision of law made very clear that, when the repair cost exceeds the actual cost of the vessel it is deemed to be a constructive total loss.  In the instant case, the hull of the Complainant extensively damaged and it cannot be repaired.  But the engine, gear with net and accessories worth Rs.3,00,000/- were intact.  Hence the Opposite Party i.e., United India Insurance Co. Ltd., represented by its Divisional Manager is hereby directed to pay a sum of Rs.9,00,000/- less Rs.3,00,000/- it comes to Rs.6,00,000/- along with interest at 8% p.a. from the date of accident till the date of payment.  Further the Opposite Party Company is at liberty to deduct the reasonable salvage value of the Hull.  Further Rs.1,000/- awarded as cost of litigation expenses.  Payment shall be made within 30 days from the date of this order.

However, the interest as well as compensation both cannot be allowed. Interest is always inclusive of compensation.

6.       In the result, we pass the following:

ORDER

            The complaint is allowed.  Opposite Party i.e., United India Insurance Co. Ltd., represented by its Divisional Manager is hereby directed to pay a sum of Rs.6,00,000/- (Rupees six lakh only) to the Complainant along with interest at 8% p.a. from the date of accident till the date of payment.  Further the Opposite Party Company is at liberty to deduct the reasonable salvage value of the Hull.  Further Rs.1,000/- (Rupees one thousand only) awarded as cost of litigation expenses.  Payment shall be made within 30 days from the date of this order.

The copy of this order as per the statutory requirements be forwarded to the parties free of charge or sent to the parties under postal certificate and thereafter the file shall be consigned to the record room.

(Page No.1 to 26 dictated to the Stenographer typed by her, revised and pronounced in the open court on this the 30^th day of September 2011.)

      PRESIDENT                                                 MEMBER

ANNEXURE

Witnesses examined on behalf of the Complainant:

CW1 – Sri.Jayanth R.Salian – Complainant.

Documents produced on behalf of the Complainant:

Ex C1 – 29.08.2005: Xerox copy of the certificate of registry.

Ex C2 –                : Xerox copy of the policy bearing No.240503/ 22/08/01/00000009 valid for the period from 08.03.2009 to 07.06.2009.

Ex C3 – 30.11.2009: Lawyer’s notice issued to the Opposite Party on behalf of the Complainant.

Ex C4 –                 : Postal acknowledgement.

Ex C5 – 07.09.2008: Xerox copy of the Valuation/Inspection report issued by B.R. Rao.

Ex C6 – 11.05.2009: Xerox copy of the letter issued by the Complainant to the Registrar of fishing boats, Mangalore.

Ex C7 –                 : Xerox copy of the endorsement given by the police.

Ex C8 –                   : Xerox copy of the Spot Mahazar.

Ex C9 – 25.05.2009: Copy of the letter issued by the Complainant to the Opposite Party.

Ex C10 – 05.06.2009: Letter issued by the Opposite Party to the Complainant.

Ex C11 – 27.06.2009: Letter issued by the Complainant to the Opposite Party.

Ex C12 – 27.05.2009: Letter issued by the Surveyor Sri.Janardhan Heble to the Complainant.

Ex C13 – 27.06.2009: Letter issued by the Complainant to the Surveyor.

Ex C14 – 14.07.2009: Letter issued by the Surveyor to the Complainant.

Ex C15 – 21.07.2009: Letter issued by the Complainant to the Opposite Party.

Ex C16 – 29.07.2009: Letter issued by the Opposite Party to the Complainant.

Ex C17 – 07.08.2009: Letter issued by the Complainant to the Opposite Party.

Ex C18 – 01.09.2009: Letter issued by the Complainant to the Surveyor.

Ex C19 – 07.09.2009: Letter issued by the Surveyor to the Complainant.

Ex C20 – 08.09.2009: Letter issued by the Opposite Party to the Complainant.

Ex C21 – 10.09.2009: Letter issued by the Complainant to the Surveyor.

Ex C22 – 14.09.2009: Letter issued by the Surveyor to the Complainant.

Ex C23 – 23.09.2009: Letter issued by the Opposite Party to the Complainant.

Ex C24 – 28.09.2009: Letter issued by the Surveyor to the Complainant.

Ex C25 – 06.10.2009: Letter issued by the Opposite Party to the Complainant.

Ex C26 – 12.10.2009: Letter issued by the Complainant to the Opposite Party.

Ex C27 – 26.10.2009: Letter issued by the Surveyor to the Complainant.

Ex C28 – 06.01.2010: Findings of the Enquiry Officer/Port Officer, Old Port Office, Mangalore.

Ex C29 – 06.01.2010: Letter issued by the Port Officer, Registrar of Indian fishing Boats, Mangalore to the Principal Officer I/C, Mercantile Marine Dept., Cochin.

Witnesses examined on behalf of the Opposite Party:

RW1 – Sri.P.Venkataprasad, Administrative Officer of the Opposite Party.

RW2 – Sri.Janardhan Heble – General Insurance Surveyor, Loss Assessor and Valuer of the Opposite Party.

Documents produced on behalf of the Opposite Party:   

Ex R1 –              : Certified copy of the Insurance Policy issued by the Opposite Party.

Ex R2 – 23.04.2010: Survey report of the Surveyor Mr.Janardhana Heble; with Xerox copies of various documents enclosed thereto; including the assessment of other boats suffered similar damages on earlier occasions which are similar to this claim with photographs of respective boats; i.e., M.F.V. Vigneshwara, Suvarna Sagar, Subhashree, Jala Althiya and Mahalaxmi. 

Ex R3 -               : Photographs of the boat involved in the alleged accident which are taken by the Surveyor (28 in numbers).

Ex R4 – 25.05.2009: Intimation of claim submitted by the Complainant.

Ex R5 – 05.05.2009: Claim form submitted by the Complainant received on 01.06.2009.

Dated:30.09.2011                            PRESIDENT