State Consumer Disputes Redressal Commission
The Manager, vs Saji Varghese.K., on 7 December, 2010
Daily Order
First Appeal No. A/10/335 (Arisen out of Order Dated 27/02/2010 in Case No. CC/08/163 of District Wayanad) The Manager,Bajaj Allianz General Insurance co Ltd Vs. Saji Vargheese.K BEFORE: Sri.M.V.VISWANATHAN PRESIDING MEMBER PRESENT: Dated : 07 Dec 2010 ORDER Disposed as Allowed in part
KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAD, THIRUVANANTHAPURAM
APPEAL 335/10
JUDGMENT DATED: 7.12.2010
PRESENT
SMT.VALSALA SARANGADHARAN : MEMBER
SRI.M.V.VISWANATHAN : JUDICIAL MEMBER
SRI.M.KABDULLA SONA : MEMBER
1. The Manager, : APPELLANTS
Bajaj Allianz General Insurance Co. Ltd.,
Police station road, Sultan Bathery.
2. The Manager,
Bajaj Allianz General Insurance Co. Ltd.,
G.E.Plaza, Airport road, Yerwada, Pune.
3. The Manager,
Bajaj Allianz General Insurance Co. Ltd.,
3rd Floor, finance tower, Cochin.
(By Adv.Sreevaraham G.Satheesh)
Vs.
Saji Varghese.K., : RESPONDENT
Keerikkattil house, Cheeral.P.O.,
Sulthan Bathery.
(By Adv.A.Abdulla Sait)
JUDGMENT
SRI.M.V.VISWANATHAN : JUDICIAL MEMBER The appellants were the opposite parties and the respondent was the complainant in CC.163/08 on the file of CDRF, Kalpetta. The complaint therein was filed claiming the insurance claim of Rs.90000/- with respect to the insured vehicle which met with an accident on 11.1.08. The complainant has also claimed compensation of Rs.50000/- for mental agony suffered by him due to the failure to settle the insurance claim for Rs.90000/- and also for cost of Rs.5000/-. The opposite parties entered appearance and filed joint written version contending that there was no deficiency in service on the part of the opposite parties in settling the insurance claim and that the delay in settling the insurance claim occurred due to the lapse on the part of the complainant. It is further contended that the opposite party/insurance company deputed approved surveyor and the surveyor assessed the loss at Rs.46541/- and that the opposite party/insurance company was ready to settle the insurance claim at Rs.46541/- on getting insured vehicle repaired. Thus, the opposite parties prayed for dismissal of the complaint.
2. Before the Forum below Ext.A1 to A5 documents were marked on the side of the complainant. Ext.C1 commission report was also marked. The documents produced by the opposite parties at the instance of the complainant were marked as Ext.X1(a) to X1(e). The complainant and 3rd opposite party filed proof affidavit on the side of the opposite parties OPW1 and OPW2 were also examined. On an appreciation of the evidence on record, the Forum below passed the impugned order dated 27th February, 2010 directing the opposite parties to pay the complainant full insurance amount of Rs.90,000/- with interest at 10% per annum from the date of complaint till payment. Hence the present appeal.
3. Heard both sides. The learned counsel for the appellants/opposite parties submitted his arguments based on the grounds urged in the memorandum of the present appeal. He much relied on Ext.X1(b) motor survey report dated 15.5.08 filed by the approved surveyor K.V.Jeevan and argued for the position that there was no deficiency in service on the part of the appellants/opposite parties and that the appellant/opposite party/ Insurance company was always ready to settle the insurance claim based on the loss assessed by the surveyor and that the respondent/ complainant failed to take necessary steps to get the damaged vehicle repaired. It is further submitted that C1 commission report was submitted after the lapse of more than one year and no reliance can be placed on C1 commission report in assessing the loss sustained by the respondent/ complainant(insured). It is further submitted that the Forum below has gone wrong in treating the damage caused to the insured vehicle by total loss and awarding the insurance amount of Rs.90000/-. He much relied on the terms and conditions of the policy which was produced along with the appeal memorandum. Thus, the appellants prayed for setting aside the impugned order passed by the Forum below. On the other hand, the learned counsel for the respondent/complainant supported the impugned order passed by the Forum below. It is submitted that the surveyor assessed the loss without any basis and there is no reason or explanation forthcoming to discard the loss estimated by the repairer M/s New India Maruti Service Station, sulthanbathery, Wayanad. He also pointed out the photographs produced by the commissioner who submitted C1 commission report and argued for the position that the insured vehicle sustained extensive damage and the said loss suffered by the complainant/insured is to be treated as total loss. Thus, the respondent prayed for dismissal of the present appeal.
4. The points that arise for consideration are:-
1) Whether the case of respondent/complainant that the insured vehicle sustained extensive damage and the loss to the complainant/insured is to be considered as total loss can be upheld?
2) Is there any sustainable ground to reject or discard X1(b) motor survey report submitted by the approved surveyor.K.V.Jeevan?
3) Whether there was any deficiency in service on the part of the appellants/opposite parties for settling the insurance claim preferred by the respondent/complainant?
4) Is there any sustainable ground warranting interference with the impugned order dated 27.2.10 passed by CDRF, Wayanad in CC.163/08?
5. Points 1 to 4:-
There is no dispute that the respondent/complainant had insured his maruti Omni vehicle bearing Registration No. PY-01-M-8946 with the appellants/opposite parties/Bajaj Alliance General Insurance Co.Ltd. The insured vehicle was a Maruti Omni van of 1999 model and the same was insured for a sum of Rs.90000/- as IDV(insured declared value). The aforesaid policy was valid and effective from 24.12.07 to 23.12.08. Admittedly the insured vehicle met with an accident on 11.1.08 in a road traffic accident involving the insured vehicle. The respondent/complainant being the owner and insured submitted the insurance claim and the appellants/opposite parties/Insurance Co. deputed an approved surveyor who assessed the loss. Ext.X1(b) is copy of motor survey report submitted by the approved surveyor Jeevan. The said survey report is dated 15.5.2008. The surveyor assessed the net loss at Rs.46541/- by deducting depreciation and policy excess, and also salvage value of Rs.1000/-. Admittedly the appellants/opposite parties/Insurance Co. offered the aforesaid sum of Rs.46541/- by way of full and final settlement of the insurance. Readiness of the appellants/opposite parties/Insurance Co to settle the insurance claim at Rs.46541/- based on the loss assessed by the approved surveyor can be seen from Exts.A1,A3,A4 and A5 correspondence between complainant/ insured and the opposite party/Bajaj Allianz General Insurance Co.Ltd.
6. The definite case of the respondent/complainant is that the insured vehicle covered by Ext.X1(a) policy of insurance sustained extensive damage and the loss sustained in the said road traffic accident is to be treated as total loss. The respondent/complainant claimed insured sum of R.90000/-. There is no dispute that the insured vehicle was insured for a sum of Rs.90000/- as IDV. The terms and conditions of the policy produced by the appellant/Insurance Co. would show that IDV shall be treated as the "market value through out the policy period without any further depreciation for the purpose of total loss (TL)/constructive total loss(CTL) claims. It is further stated in the policy conditions that the insured vehicle shall be treated as CTL(constructive total loss) if the agreed cost of retrieval and repair of the vehicle, subject to terms and conditions of the policy, exceeds 75% of the IDV of the vehicle. The aforesaid stipulations would show that the appellant/opposite party/Insurance Co is liable to pay the IDV of the insured vehicle if it is found that the insured vehicle is to be treated as a case of total loss or constructive total loss. It would also show that if the total repair charge for repairing the insured damaged vehicle exceeds 75% of the IDV of the vehicle, then it is to be treated as constructive total loss.
7. The insured vehicle was having an IDV of Rs.90000/-. The 75% of the IDV would come to Rs.67500/-. Ext.X1(b) survey report would show that the estimated cost for repairing the damaged insured vehicle was Rs.92746/-. The definite case of the complainant/insured is that the repairer estimated the repair cost at Rs. 1,02,000/- and there was the possibility of getting the repair cost increased by the time of completion of the repair works. But the complainant has not produced the estimate given by the repairer demanding the repair cost of Rs.1,02,000/-. On the other hand the approved surveyor who filed X1(b) survey report would show that the repairer estimated the total repair cost at Rs.92,746/-. So, it can be seen that the repair cost estimated by the surveyor was exceeding the insured sum of Rs.90000/-. In such a situation, it can be held that the insured vehicle would have been treated as constructive total loss. It is to be noted that the repair cost would exceed 75% of the IDV of the vehicle.
8. The approved surveyor who submitted X1(b) motor survey report dated 15.5.08 assessed the net loss at Rs.47541/- and after deducting salvage value of Rs.1000/- the net loss would come to Rs.46541/-. Ext.X1(b) survey report would show that the repairer estimated the labour charge at Rs.31000/-. The surveyor recommended Rs.20500/-. But no explanation has given for reducing the labour charge from Rs.31000/- to Rs. 20500/-. The approved surveyor has no case that the repairer agreed to do the repair works at the labour charges of Rs.20,500/-. There is also no case for the approved surveyor that the repairer agreed at Rs.20500 by way of labour charge. No consent letter or endorsement was obtained by the surveyor from the repairer.
9. The surveyor Mr.Jeevan was examined before the Forum below on the side of the opposite party/Insurance Co. He has not given any evidence that the repairer agreed to carry out the repair works at Rs.47541.79. He has also no case that the repairer agreed to carry out the repair works at the labour charge of Rs.20500/-. It is to be borne in mind that the repair works are to be carried out by the repairer /Automobile workshop. Then there is no meaning or basis in unilaterally fixing the labour charge at Rs.20500/- without consent or concurrence to the repairer. The appellants/opposite parties/Insurance Co. or the approved surveyor have no case that any other repairer was ready and willing to do the repair works at Rs.47,541.79/- or at labour charges of Rs.20500/- The approved surveyor cannot be justified in reducing the labour charge from Rs.31000/- to Rs.25000.
10. The repairer estimated the cost of the spare parts at Rs.92746.19/-. But the approved surveyor recommended only Rs.47,541.79/- by way of cost of spares. The approved surveyor rejected the estimate for replacement of many of the damaged spare parts. It is also reported by the surveyor that damage to the spare parts can be repaired. But the repairer had not agreed for effecting the repair works without replacing those spare parts. The approved surveyor failed to get the consent of the repairer agreeing to effect the repair without replacement of those parts. There is also no case for the approved surveyor that the repairer agreed to effect the repairing to the damaged vehicle at a total repair cost of Rs.47541.79/- The approved surveyor has also no case that any other repairer was ready to execute repair works at a total cost of Rs.47541.79/-. The appellants/opposite parties/ Bajaj Allianz General Insurance Co.Ltd. have also no such case that the repair works can be carried out at total cost of Rs.47541. 79/- In the absence of any such evidence, it can only be concluded that it was practically impossible or not feasible to carry out the repairs for the damaged insured vehicle at Rs.47541. Thus, Ext.X1(b) survey report would make it clear that the repairer was ready to execute the repair works at a total cost of Rs.92746.19/-. If that be so, the damage to the insured vehicle can be treated as constructive total loss. The case of respondent/complainant to treat the loss as constructive total loss is to be upheld. The approved surveyor was examined as OPW2. He failed to give reasonable explanation for rejecting or discarding the repair cost estimated by the repairer. It is true that the report of an approved surveyor is to be considered as an importance piece of evidence and the same cannot be discarded without valid reason or ground. United India Insurance Co.Ltd and others vs.Roshan Lal Oil Mills Ltd. And others [(2000) 10 SCC 19]. But at the same time the Hon'ble Supreme Court has also held that the survey report is not the last and final word [IV (2009) CPJ 46 (SC)] and the same can be setaside on valid ground. The available circumstance and evidence on record would show that X1(b) survey report cannot be accepted as such and that the loss assessed by the surveyor in X1(b) survey report cannot be accepted for the reasons aforementioned.
11. The complainant before the Forum below filed an application for appointing an expert commissioner to assess the loss/damage caused to the insured vehicle. The Forum below appointed the approved and licensed surveyor T.S.Razhil as an expert commissioner. The report filed by the expert commissioner(approved surveyor T.S.Razhil) has been marked as Ext.C1. The C1 report is dated 8.9.09. The expert commissioner inspected the damaged vehicle on 6.7.09. Alongwith C1 commission report he has also produced the photographs of the damaged insured vehicle. A mere look at those photographs would make it crystal clear that the vehicle sustained extensive damage and the damage to the insured vehicle can be treated as constructive total loss. This is a fit case for assessing the loss on total loss basis. It is pertinent to note at this juncture that the 1st surveyor who was deputed by the opposite party/insurance company failed to produce any photographs. The appellant/opposite party/Insurance Co. has also failed to produce the photographs of the damaged insured vehicle.
12. Admittedly the insured vehicle which sustained damage in road traffic accident was taken to the repairer by name New Indian Maruti Service Station. The 1st Surveyor and the 2nd surveyor inspected the vehicle at the premises of New Indian Maruti Service Station, Sulthanbathery, Wayanad. The estimate for the repair works was also given by the aforesaid repairer New Indian Maruthi Service station. Along with C1 commission report the expert commissioner has also submitted the job estimate given by the repairer. It is to be noted that the 2nd surveyor inspected the vehicle after the lapse of more than 10 months. Job estimate given by the repairer would show that the present cost of repair would come to Rs.1,93,640.66/-. The 2nd surveyor who submitted C1 report assessed the damage or loss at Rs.1,46,675 after deducting the salvage value of Rs.15000/-. The 2nd surveyor has also given a very detailed report regarding the damage to the insured vehicle. It is also to be noted that the 2nd surveyor is also an approved surveyor and loss assessor. He inspected the insured vehicle with notice to both the insured and insurer. But no representative of the insurance company was present at the time of the inspection by the 2nd surveyor. C1 report would give an indication that the assessment of loss/damage made by the 1st surveyor was very low compared to the loss assessed by the 2nd surveyor T.S.Razhil. The materials available on record would make it abundantly clear that the insured vehicle sustained extensive damage and the repair cost at the time of the damage would come to more than the insured sum of Rs.90000/-. The nature of the damage caused to the insured vehicle would suggest that the said loss is to be assessed on total loss/constructive total loss basis. The Forum below can be justified in accepting the case of the complainant regarding total loss.
13. Ext.C1 expert commission report would show that the salvage value of the vehicle would come to Rs.15000/-. Admittedly the respondent/ complainant is in possession of the insured vehicle. The liability of the appellant/opposite party/ Insurance Co can only be less the salvage value. The total liability would come to the insured sum of Rs.90000/-. After deducting the salvage value of Rs.15000/- the liability of the appellant/Insurance Co. can be fixed at (Rs.90000-- 15000/-) = Rs.75000/-. The Forum below cannot be justified in directing the opposite parties to pay Rs.90000/- to the complainant without considering the salvage value assessed by the expert commissioner at Rs.15000/-. The assessment of salvage value at Rs.15000/- can be treated as very reasonable. So, the impugned order passed by Forum below is liable to be modified accordingly. The interest at the rate of 10% per annum awarded by the Forum below can be treated as reasonable and fair. Hence the same is also upheld. These points are answered accordingly.
In the result the appeal is allowed partly. The impugned order dated 27.2.2010 passed by CDRF, Kalpetta in CC.163/08 is modified and thereby the appellants/opposite parties are directed to pay a sum of Rs.75000/- by way of insurance claim due to the respondent/complainant with interest at the rate of 10% per annum from the date of the complaint till payment. The parties are directed to suffer their respective costs through out.
SRI.M.V.VISWANATHAN : JUDICIAL MEMBER
SMT.VALSALA SARANGADHARAN : MEMBER
SRI.M.KABDULLA SONA : MEMBER
ps
[ Sri.M.V.VISWANATHAN] PRESIDING MEMBER