BEFORE THE DAKSHINA KANNADA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, MANGALORE
Dated this the 21st March 2012
PRESENT
SMT. ASHA SHETTY : HON’BLE PRESIDENT
SMT.LAVANYA M. RAI : MEMBER
SRI. ARUN KUMAR K. : MEMBER
COMPLAINT NO.248/2010
(Admitted on 9.9.2010)
Ms. Tour Arabia,
Door No.1-1-90/3(1),
Padavinangady Junction,
Airport Road, Konchady Post,
Mangalore, Represented by
its Proprietor Mr.Naveen Saldana,
So. Antony Saldanha,
Aged about 43 years,
Residing at Shanthi Adana,
Balehonnur Post,
Chickmagalor District. …….. COMPLAINANT
(Advocate for the Complainant: Smt.Manjula.N.A.)
VERSUS
The New India Assurance Co. Ltd.,
III Floor, Essel Chamber,
Karangalpady,
Kodialbail Post,
Mangalore 575 003.
Represented by the Branch Manager. …. OPPOSITE PARTY
(Advocate for the Opposite Party: Sri Anilkumar.K)
* * * *
ORDER DELIVERED BY HON’BLE PRESIDENT
SMT. ASHA SHETTY:
I. 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 stated that, he is having office at Door.No.1-90/3(1) at Mangalore and installed Computers, Scanners, Air Conditioners and U.P.S., etc. It is stated that, the office premises has electrical and electronics items described in the schedule of the Complaint, the above said items were insured under the Standard Fire and Special Perils Policy No. 670805/11/09/11/00000192 valid from 21.5.2009 to 20.5.2010 for a sum of Rs.45,69,893/-. It is stated that, the above said policy covered the risk in respect of the office premises of the Complainant and also furniture, fixtures, fittings and schedule items.
It is stated that, on 20.11.2009 around 2.15 P.M., the Complainant’s staff heard a big sound around office premises and all the computers went off and electronic system failed. The Complainant called the MESCOM, electricians and police, the electrician came to the spot and found that the electrical system was not in order. After he checked, the arrestor which had fallen down from the roof top and opined that lightening must have struck his RF towers and there by the schedule descried items are damaged. It is also stated that, the electrical supply to the main switch board is in order and there is no electrical fault. Thereafter, the Complainant called NITK engineers who were pointed that due to the lightening the schedule items were damaged. Immediately the Complainant reported the matter to the Development Officer of the Opposite Party and stated that the necessary claim form along with relevant documents pertaining to the damaged equipments/articles but Opposite Party inspite of best co-operation in furnishing the necessary documents and have deliberately delayed settlement without any justifiable cause. It is stated that, on account of the lightening the fire covered inside and around office premises of the ceiling and wall roof over which the RF system tower was installed has been damaged and all the electrical, electronic equipments shown in the schedule of the Complaint also damaged and suffered loss at Rs.9,04,597/-. On account of the non-settlement of the Complainant’s claim they have put to irreparable loss and hardship and hence the Complainant was constrained to issued legal notice dated 22.6.2010 calling upon the Opposite Party to pay the amount. But Opposite Parties not complied the demand made therein. Feeling aggrieved by the above, the Complainant 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 Party to pay a sum of Rs.9,04,597/- to the complainant and pay compensation and costs of the proceedings.
II. 1. Version notice served to the Opposite Party by R.P.A.D. Opposite Party appeared through their counsel filed version and admitted the policy but stated that upon the intimation as to alleged incident this Opposite Party had deputed an authorized Surveyor and Loss Assessor, who has carried out with inspection in the presence of the Complainant and who has reasonably assessed the actual loss at Rs.14,256/- and Rs.250/- towards salvage minus policy excess of Rs.10,000/- and net liability of Opposite Party at Rs.4,000/- in terms of the policy issued to the Opposite Party. The Opposite Party further stated that the damages to the schedule mentioned electrical/electronic items was due to voltage surge caused by lightening, which is a peril not covered general exclusion No.7 of the policy. It is stated that, the claim is admissible only to the extent of Rs.4,000/- and not otherwise and contended that there is no deficiency and prayed for dismissal of the Complaint.
III. 1. In support of the complaint, Smt.Jayanthi Moolya (CW1) – Administrative Manager of the Complainant firm filed affidavit reiterating what has been stated in the complaint and answered the interrogatories served on him. Ex C1 to C7 were exhibited for the Complainant as listed in the annexure in detail. One Mr.A.M. Belma (RW1), Senior Branch Manager and one Sri.U.Vasudeva Prabhu (RW2) – General Insurance Surveyor of the Opposite Party filed counter affidavits and answered the interrogatories served on them. Ex R1 and R2 were exhibited for the Opposite Party as listed in the annexure in detail. Both the parties produced notes of arguments.
In view of the above said facts, the points now that arise for our consideration in this case are as under:
- Whether the Complainant proves that Opposite Parties have committed deficiency in service?
- If so, whether the Complainant is entitled for the reliefs claimed?
- What order?
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) & (iii): As per the final order.
REASONS
IV. 1. Points No. (i) to (iii):
In the instant case, the facts which are admitted is that, the complainant insured/obtained Standard Fire and Special Perils Policy bearing No.670805/11/09/11/00000192 from the Opposite Party, the same was valid from 21.5.2009 to 20.5.2010 for a sum of Rs.45,69,893/-. Under the above said policy, the Opposite Party has covered the risk in respect of the said office premises of the complainant and also the furniture, fixtures, fittings and schedule items from detailed in the complaint wherein some items were covered under the Furniture, fixtures and fittings.
Now the point in dispute between the parties before this FORA is that, the Complainant came with a complaint contended that, on 20.11.2009 around 2.15 P.M., the complainant’s staff heard a big sound around office premises and all the computers went off and all the electronic system failed. Thereafter, the complainant informed MESCOM, electrician, police and the electrician came to the spot and found that the electrical system was not in order, when he checked, he found that arrestor had fallen down from the roof top and opined that lightening must have struck RF towers and hence through the RF Tower all the items described in the complaint are damaged. It is stated that thereafter, he approached the Opposite Party to claim the compensation but the Opposite Party not honoured the claim and later they have sent a letter along with a voucher for Rs.4,000/- stated that it is the value of the loss suffered by the complainant on account of the said accident is arbitrary and without basis and hence came up with this complaint.
The Opposite Party on the other hand contended that the damage to the electrical and electronic items were due to voltage surge caused by lightening which according to the Opposite Party not a peril covered by the said policy and they offered to pay Rs.4,000/- after conducting alleged policy access to the Complainant and stated that the property were destroyed/damaged due to the peril not peril specified in the policy of insurance. Hence they are not liable to pay any compensation.
In order to substantiate the averments raised in the complaint, the Complainant filed oral evidence by way of affidavit and produced Ex C1 to C7. And Opposite Party also filed oral evidence by way of affidavit and produced Ex R1 and R2.
On perusal of the oral as well as documentary evidence available on record, we find that, admittedly the complainant has obtained a policy bearing No. 670805/11/09/11/00000192 i.e. Standard Fire and Special Perils Policy for a sum of Rs.45,69,893/- valid from 21.5.2009 to 20.5.2010. Further furniture, fixtures and fittings in total Rs.45,19,895/- was insured under the above said policy.
Now the question for consideration is that, whether the insured properties were damaged/destroyed due to the peril specified in the policy of the insurance? The answer is affirmative.
However, the Opposite Party in order to prove their contention produced the policy, wherein, the clause No.7 of the policy which reads thus:-
“Loss, destruction or damage to any electrical machine, apparatus, fixture or fitting arising from or occasioned by over-running, excessive pressure, short circuiting, arcing, self heating or leakage of electricity from whatever cause (lightning included) provided that this exclusion shall apply only to the particular electrical machine, apparatus, fixture or fitting so affected and not to other machines, apparatus, fixtures or fittings which may be destroyed or damaged by fire so set up.”
The counsel appearing for the Opposite Party vehemently argued that, the terms and conditions of the policy clearly shows the items covered for the risk mentioned therein are not covered as per general exclusion clause No.7 of the policy and stated that, the claim is in respect of risk of lightening which is subject to clause No.7 of the policy. The name of the electrical, electronic items alleged to have been damaged are not at all damaged due to fire setup by lightening. The counsel further argued that, there was lightening but there was no fire, all the alleged damage were due to electricity surge hence they are not liable to pay any compensation under the policy.
But on perusal of the exclusion clause No.7 of the policy shows that, the main part of the exclusion clause which protects the insurers from the liability under the policy covers loss of damage to any electrical machinery, electronics or fitting and so on which themselves are a loss or a damage or damaged due to short circuiting, arcing, self heating or leakage of electricity. However, the proviso to the said clause through inclusion of any other machinery, apparatus, fixture or fitting being destroyed or damaged by the fire which has affected any other appliances or electrical machines or apparatus are clearly included within the scope of the Fire Policy for whatever damage or destruction caused by the fire. If for example the short circuiting results in damage in a computer set through fire created by the short circuiting in it the claim for it is excluded under the fire policy. However, if from the same fire there is a damage to the rest of the shop premises or other appliances, the same is included within the scope of fire policy by virtue of the Proviso. In other words if the proximate cause of the loss or destruction to any other including other machines, apparatus, fixtures, fittings etc. or part of the electrical installation is due to the fire which is started in an electrical machine or apparatus all such losses because of the fire in other machinery or apparatus is covered by the Policy.
Now the main question before us, whether the fire is proximate cause of the damage in question. To understand this we have to first know the necessary facts. The Complainant specific case is that he had availed internet connection through RF system but on 20.11.2009 they have heard a big sound around office premises and all the computers went off and all the electronic systems failed and thereafter the Complainant immediately called the MESCOM and the electrician, they found that lightening arrester fallen down from the roof top and opined that lightening must have struck RF tower and hence through the RF tower all the things described in the complaint are extensively damaged. Further in order substantiate the above contents the Complainant taken expert report and produced before this FORA in CC.No.133/2010 wherein, the expert observed that, the method of installation adopted for a lightening conductor system, the condition of the system did not perform its intended function during lightening. The expert opined that, the spalling of concrete from the anchorage zone indicated that the current flow has been running through the tower and the guys, instead of the lightening conductor installed, which has been severally damaged other cabling and installations. From the above opinion of the expert clearly shows that, current flow run through the tower and the guys instead of lightening conductor installed. Other than his opinion, we have gone through the definition and cause of lightening defined in Wikipedia/Free Encyclopedia, wherein, the lightening means: is an atmospheric discharge (spark) accompanied by thunder, usually associated and produced by cumulonimbus clouds. The cause of the lightening is created by an electrical discharge causing huge spark (flash of light) ice and water form in clouds creating an electrical buildup. From the above it is made very clear that lightening is created by an electrical discharge causing huge spark.
Even in the present case, no doubt, the Opposite Party and the complainant admitted that there was a lightening and the same was struck to the arrester which was fixed on the top of the shop premises. So the predominant view is to be appears that, the proximate cause is not the cause which is nearest in time or place but the active and efficient cause that sets in motion or all the chain of events brings about the ultimate results without the intervention of any other fire working from an independent source. But the fire/spark occurred in the lightening wherein it created an electrical discharge/current flow run through the tower and the guys which has severally damaged cabling and other installations. In our opinion duration of fire is not relevant. As long as there was a fire which caused the damage the claim is maintainable. Even if a fire is fraction of second is sufficient. When that being so, the Opposite Party cannot contend that there was no sustained fire, in our opinion the same is not justified. On the other hand, it is evident from the above discussion that, the fire was the efficient and active cause of the damage. Had the fire not occurred, the damage was also would not have occurred and there was no intervening agency which was an independent source of the damage. That the fire occurred in the lightening arrester fixed on the top of the building, through which the wires of electric lightening were carried. Naturally, when the fire/spark for a fraction of second it speedily extinguished without contact with other part of the building but it may operate through successive instruments as an at the end of a chain may be moved by force applied to the other end. The question is; was there an unbroken connection, in other words did the facts constitute a continuous succession of events. As the expert pointed out that current flow has been running through the tower and the guys instead of the lightening conductor installed, which has been severally damaged other cabling and installations.
In view of the above discussion, we hold that the fire was the efficient and active cause of damage. Even in case of ambiguity in a contract of insurance, the ambiguity should be resolved in favour of the claimant and against the insurance company. Therefore, considering all the above reasons, we are declined to accept the arguments of the Opposite Party counsel in this case and we hold that Opposite Party cannot avoid the liability under the policy.
The above view of ours supported by the observation taken in a case New India Assurance Company Limited Vs M/s. Zuari Industries Ltd. & others, the Hon’ble Supreme Court as observed hereunder:
“CONSUMER Protection Act, 1986 – INSURANCE – Claim under fire policy and consequential loss due to fire policy – Claim rejected on the ground that the loss to the boiler and other equipments was not caused by the fire, but by the stoppage of electric supply due to the short circuiting in the switch board – National Commission allowed the claim of the respondent and hence this appeal whether the flashover and fire was the proximate cause of the damage – It is admitted that the short circuit in the main switch board caused a flashover –As long as there is a fire which caused the damage the claim is maintainable, even if the fire is for a fraction of a second. The term ‘Fire’ in clause (1) of the Fire Policy ‘C’ is not qualified by the word ‘sustained’. It is well settled that the Court cannot add words to statute or to a document and must read it as it is. Hence repudiation of the policy on the ground that there was no ‘sustained fire’ is not justified – it is evident from the chain of events that the fire was the efficient and active cause of the damage. Had the fire not occurred, the damage was also would not have occurred and there was no intervening agency which was an independent source of the damage – Hence cannot agree with the conclusion of the surveyors that the fire was not the cause of the damage to the machinery of the claimant – No merit in this appeal and it is dismissed.”
And in another case the Hon’ble National Commission reported in CDJ 2008 Case No.14, wherein, it is observed as under:-
“Wherever the policy conditions are not clear and capable of more than one interpretation which is beneficial to the consumer should be adopted.”
The above observations made by the lordships are applicable to the case on hand.
Further, it is seen that, the endorsement under the policy shows that, the building was covered for Rs.29,88,602/-. That the furniture, fixture and fittings covered for Rs.15,81,293/- as per Ex.C1 i.e. Standard Fire and Special Perils Policy. The Ex.C4 is the claim form along with properties destroyed and Ex. R2 is the survey report dated 4.4.2010 produced before the FORA shows that, the surveyor who surveyed the loss, in Para No.4 under the heading the ‘Cause of Damage’ shown as under: “RF system tower, all the electronic/ electrical equipment like Computers (14 Nos.), UPS system, Bore-well Pump and its switch board, Air Conditioners (4 Nos.) EPABX system, Telephone instruments, Fax Machine, Main Switch Board of electrical system, Tube lights, light fittings, Ceiling Fans etc. were damage due to voltage surge caused by lightening”. Further under the heading ‘Loss of Assessment’ the surveyor discussed the description of the damaged items and also the repair bill received by him and assessed the loss at Rs.1,13,447/-. But in the above discussion the new replacement of the UPS was not considered by the surveyor. Further under the heading loss to the damaged building assessed at Rs.14,256/-. While considering the loss surveyor has opined that all the damages to the electronic and electrical appliances were due to voltage surge caused by lightening which is not covered under the policy. The above view of the surveyor is not acceptable in this case. The Opposite Party Company is liable to pay the above loss suffered by the Complainant. Therefore, we are of the considered opinion that the interpretation made by the Opposite Party Company is not accepted by us and the rejection of the claim in this case is arbitrary and amounts to deficiency in service.
As far as damages are concerned, the complainant produced the repair bills before the surveyor which is not disputed and the same comes to Rs.1,13,447/- which includes the computers (14 in No.s) repair charges, scanner – 1 No., Godrej – 3 Nos., electrical repair work, electrical point, building repairs, telephone units -5 Nos. and bore well pump. Out of the above description UPS new purchased by the Complainant is of Rs.1,07,840/- is not considered by the surveyor and the loss to the damaged building was assessed as Rs.14,256/-. The Opposite Party company liable to pay the above loss suffered by the Complainant under the subject insurance policy issued by them. By considering all the above loss, it comes to Rs.2,35,543/-, the same shall be entitled by the Complainant. Therefore, in view of the fore going reasons, we hereby directed the Opposite Party company to pay Rs.2,35,543/- (Rupees Two lakhs thirty five thousand five hundred forty three only) with interest at 10% per annum from the date of accident till the date of payment to the Complainant and further Rs.1,000/- (Rupees one thousand only) as cost of the litigation expenses. Payment shall be made within 30 days from the date of this order.
In the present case, interest considered by this Forum itself is compensation and therefore, no separate amount for compensation is awarded.
In the result, we pass the following:
ORDER
The complaint is allowed. The Opposite Party i.e. The New India Assurance Co. Ltd., represented by the Branch Manager/Authorized Signatory is hereby directed to pay a sum of Rs.2,35,543/- (Rupees Two lakhs thirty five thousand five hundred forty three only) along with interest at 10% per annum from the date of incident till the date of payment and further Rs.1,000/- (Rupees one thousand only) as cost of the litigation expenses. Payment shall be made within 30 days from the date of this order.
Copy of this order as per statutory requirements, be forward to the parties free of costs and file shall be consigned to record room.
(Page No.1 to 16 dictated to the Stenographer typed by him, revised and pronounced in the open court on this 21st day of March 2012.)
PRESIDENT MEMBER MEMBER
ANNEXURE
Witnesses examined on behalf of the Complainant:
CW1 – Smt.Jayanthi Moolya – Administrative Manager of the Complainant firm.
Documents produced on behalf of the Complainant:
Ex C1 – : Standard Fire and Special Perils Policy bearing policy No.670805/11/09/11/00000192 for a sum of Rs.45,19,895/-.
Ex C2 – : Xerox copy of the list of assets for Fire and Burglary Insurance.
Ex C3 – 21.11.2009: Letter issued by the Complainant to the Opposite Party (Xerox).
Ex C4 – 14.12.2009: Xerox copy of the claim form along with details of properties destroyed.
Ex C5 – 22.06.2010: Copy of the legal notice issued to the Opposite Party.
Ex C6 – 30.07.2010: Reply issued by the Opposite Party.
Ex C7 – 09.08.2010: Authorization letter issued by one Mr.Naveen T. Saldanha in favour of Mrs.Jayanthi H Moolya.
Witnesses examined on behalf of the Opposite Party:
RW1 – Mr.A.M. Belma (RW1), Senior Branch Manager of the
Opposite Party.
RW2 – Sri.U.Vasudeva Prabhu – General Insurance Surveyor of the Opposite Party.
Documents produced on behalf of the Opposite Party:
Ex R1 – : Standard Fire and Special Perils Policy bearing policy No.670805/11/09/11/00000192 for a sum of Rs.45,19,895/- along with terms and conditions.
Ex R2 – 04.04.2010: Survey report prepared by Sri.U.Vasudeva Prabhu, Surveyor and Loss Assessor along with photos (24 in Nos.).
Dated:21-3-2012 PRESIDENT
