State Consumer Disputes Redressal Commission
Mrs. Archana Bhobe vs Hdfc Ergo on 3 January, 2014
BEFORE THE GOA STATE CONSUMER DISPUTES REDRESSAL COMMISSION PANAJI GOA C.C. No. 17/2013 1. Mrs. Archana Bhobe Major of age, married W/o Mr. Gurudatt Bhobe R/o SHLOKA, 21/454, Nagali Hills, Dona Paula North Goa 403004. 2. Mr. Gurudatt Bhone alias Mr. Sumeet Bhobe, Major of age, married Husband of Mrs. Archana Bhobe R/o SHLOKA, 21/454, Nagali Hills, Dona Paula North Goa 403004. .Complainants V/s. 1. HDFC ERGO General Insurance Company Ltd., 6th Floor, Leela Business Park, Andheri Kurla Road, Andheri (E) Mumbai 400059. 2. BMW India Pvt. Ltd DLF Cyber City 8, Tower B, 7th Floor Gurgaon, Haryana. 3. Bavaria Motors Pvt. Ltd., Through its General Manager Having its registered office at Plot No: 2-B, Phase 1-A Verna Industrial Estate, Verna Goa 403722 .Opposite Parties Complainants are represented by Adv. Shri. Bras DSa. OP No. 1 is represented by Adv. Shri. V. Kurtikar. OP No. 2 is represented by Adv. Shri. N. G. Kamat. OP No. 3 is represented by Adv. Shri. S. Dessai. Coram: Shri Justice N.A. Britto, President Smt. Vidhya R. Gurav, Member Dated: 03/01/2014 ORDER
[Per Shri. Justice N. A. Britto, President] This consumer complaint filed on 25/09/13 is being disposed off by this order.
2. To cut a long story short, it may be stated that complainant No. 1 had purchased a sports utility vehicle, namely BMW X5 on 19/04/10 for a sum of Rs. 60,75,000/-
and registered the same under No. GA-07-E-0590. The said vehicle was purchased by complainant No. 1 from OP No. 3, the dealer of OP No. 2, the manufacturer of the said vehicle, and it was insured with OP No. 1 under a policy known as private car package policy with additional benefit of zero depreciation-silver plan. It did not provide for damage to internal child parts of the engine arising out of water ingression which is provided under platinum plan. Lastly, complainant No. 2 had renewed the policy effective from 16/04/13 to 15/04/14 by declaring its IDV at Rs. 42,07,768 and by paying a premium of Rs. 97,666/-. As per the complainants, they had obtained the said policy because it covered a wide range of accidents, including damage due to flooding which was becoming more and more common in Indian cities and towns of late.
3. On 3/07/13 the complainant No. 2 was on his way to visit the temple of Lord Damodar at Zambaulim and he left his residence at Panaji at about 5 a.m. According to the complainants, it was raining heavily on that day, and the main road got water logged at several places but the complainant No. 2 exercised extreme caution while driving. Nevertheless, the complainant No. 2 all of a sudden encountered an unprecedented dip in the road surface where a few boulders were submerged in the water logged road and his car crash dived into the dip in the surface owing to the boulders, causing the front license plate to crack and the undercarriage of the vehicle being subjected to impact.
The vehicle slopped downwards in the dip of the road and water gushed into the air intake valve and resulted in a condition known as Hydrostatic Lock i.e. water entered the combustion chambers thereby jamming the engine and rendering the vehicle instantly immobile.
According to the complainant No. 2, the incident was life threatening as the entire stretch of the road suffered a power cut and abruptly become devoid of illumination. The neighbouring low lying fields were inundated with water.
According to complainant No. 2, he knew that the engine was inundated with water and trying to turn the engine would probably further fracture the engine block or smoulder the electricals in the vehicle causing it to short circuit and catch fire. Complainant No. 2 claims that he noticed the engine and the battery icon were already glowing in the instrument panel and the complainant No. 2s fear gripped him all the more and he noticed that water level was rising around his vehicle.
4. Complainant No. 2, as per him, tried to open the windows and managed to slide down one of the power windows upto 80% and managed to pull himself out of the window and sat on top of the vehicle for help to appear. Complainant No. 2 dialed BMW 24 Hours Roadside Assistance at about 0600 hours but the complainant No. 2 was told that as the complainants vehicle was three years old the vehicle could not be provided with roadside assistance.
Complainant No. 2 was advised to contact an independent towing operator and was provided with a mobile numbers and complainant No. 2 after nearly an hour managed to search for another independent tow truck operator who came to the rescue of complainant No. 2, and towed the vehicle on the dried portion of the road (tarmac) about 2 kms from the accident spot. The complainant No. 2 then called OP No. 3, the dealer who dispatched an appropriate flat bed truck to retrieve the vehicle.
5. The complainants claim that they registered their claim online on 4/7/13 but as per OP No. 1, formal claim intimation was lodged only on 6/7/13.
6. OP No. 1, the insurer, on 8/7/13 appointed a duly licensed surveyor by name Fulao Fernandes who conducted a survey of the vehicle on 8/7/13, 19/7/13 and 25/7/13.
At the request of the complainants, OP No. 3 gave on 8/7/13 a repair quote of Rs. 17,66,652/- and after it was brought to their notice that sunroof was not operating, further repair quote was given on 12/7/13 for Rs. 2,64,367/- and further repair quote was given on 17/8/13 for Rs. 33,87,624/- after having realized that affected parts would have high number of visible corrosion marks, as the engine had remained soaked with water for almost a month. The surveyor submitted his report dated 29/7/13 and OP No. 1 the insurer by their letter dated 31/7/13 informed the complainants that they were not liable to make any payment in view of condition 4 of the policy which reads as follows:-
the insured shall take all reasonable steps to safeguard the vehicle from loss or damage and to maintain it in efficient condition and the Company shall have at all time free and full access to examine the vehicle or any part thereof or any driver or employee of the insured. In the event of any accident or breakdown, the vehicle shall not be left unattended without proper precautions being taken to prevent further damage or loss and if the vehicle be driven before the necessary repairs are affected any extension of the damage or any further damage to the vehicle shall be entirely at the insureds risk.
and also on condition No. 1 which states that notice shall be given in writing to the Company immediately upon the occurrence of any accidental loss or damage in the event of any claim and thereafter the insured shall give all such information and assistance as the Company shall require. The fundamentals of vehicle engine were explained to the complainants and the complainants were informed that after engine was filled with water the complainant No. 2 had tried to forcibly start the engine by push starting or otherwise causes the piston to move and once it was into compression stroke where the valves are closed the piston tries to compress the water, liquid being incompressible exerts equal and opposite force equal to the force applied as per Newtons third law and the exerted pressure decides the quantum of damage.
7. The complainants on or about 3/8/13 wrote to OP No. 3 and informed them that OP No. 1 had rejected their claim and that they could not let the vehicle remain idle any longer and therefore they should begin with the engine repair work immediately and that they would pay the necessary service charges, for spares and consumables that may be required to make the vehicle 100% roadworthy. The complainants also informed OP No. 3, the dealer, that in case the complainants are offered an attractive by back price for their vehicle, the complainants would purchase a new vehicle X5 and requested them to try and work out the best possible offer. OP No. 3 was also requested to prepare a fresh estimate and convey the same to the complainants for their approval.
8. Thereafter, the complainants sold the said vehicle to OP No.3 for a sum of Rs. 24,30,000/- and purchased from OP No. 3 another BMW X5 for Rs. 84,30,000/- i.e after deducting Rs. 24,30,000/-. According to OP No. 3, OP No. 3 had given an attractive offer to the complainants, as per the request made by them and it is rather unfortunate that complainants had made allegations of conspiracy against them with OP No. 1.
9. As against the above background, the complainants have claimed Rs. 50 lacs from OP Nos. 1 and 2 being the cost of the vehicle having registration No-GA-07-E-0590; the complainants have also prayed for a declaration that OP No. 1 and 3 were guilty of unfair trade practice. The complainants have also claimed a sum of Rs. 33,87,624/- as insurance claim(?) and another sum of Rs.
2,69,664/- having been paid by them for use of another vehicle at the rate of Rs. 8000/- per day for 30 days.
Complainants have also sought for refund of premium paid by them of Rs. 5,02,209/- (for all 3 years?) and compensation of Rs. 5 lacs and costs of Rs. 50,000/-.
10. The complaint has been contested by all the OPs.
11. We need not repeat the defense taken by OP No. 1, the insurer, which is in conformity with their letter dated 31/07/13.
12. The case of OP No. 2, the manufacturer of the car, is that there is no allegation in the complaint that the vehicle had any manufacturing defect or any other defect prior to the said incident and that the vehicle had run for more than three years and covered more than 46,000 kms and the warranty had already expired.
OP No. 2, the manufacturer, has also stated that the dealing between OP No. 3, the dealer, and OP No. 2, the manufacturer, is on principal to principal basis, and OP No. 3, the dealer is not their agent nor authorized to make any promise or assume any obligations on behalf of OP No. 2, and as such, they have been wrongly impleaded. OP No. 2 has stated that BMW 24 hours road assistance service is provided only for a period of two years from the date of retail sale of the car which is specifically and categorically mentioned in the service brochure given to the complainant at the time of purchase of the car and inspite of the fact that the car was more than three years old and was otherwise not covered by the said roadside assistance service, the call made by complainant No. 2 was duly attended by the phone executive who gave complainant No. 2 telephone numbers of independent towing service providers. OP No. 2 stated that there was no cause of action to the complainants to file the complaint against them and the complaint is nothing but an abuse of the process of this Commission and has been filed with ulterior motives with a view to make wrongful gains at the cost of occasioning wrongful losses to the OP and the complaint is clearly false, frivolous and vexatious and is liable to be dismissed with costs of Rs. 10,000/- to each of the OPs.
13. The case of OP No. 3 is that in keeping with the request made by the complainant No. 2, the OP No. 3 gave an attractive offer to the complainants of buying back the said vehicle for Rs. 24,30,000/-
on condition that the complainants purchase a new vehicle from OP No. 3, and the said offer was given bonafidely and in the best interest of the complainants and the said offer was given without even taking into account the amount of repairs cost the OP No. 3 may incur whilst restoring the vehicle to original manufacturing specifications.
Considering the lucrative offer given by the OP No. 3, the complainants agreed to sell their vehicle for a new BMW X5 and accordingly a purchase agreement was signed by the complainants with OP No. 3.
OP No. 3 has stated that they are in no way responsible for the accident to the earlier vehicle of the complainant No. 1 nor are they responsible for any lack of repairs on their part and it was for the complainants to approve the quotation and transfer the necessary advances before the repairs were undertaken and the mail sent by complainant No. 2 on 3/8/13 informed OP No. 3 of rejection of the insurance claim and within four days i.e. 7/8/13 a fresh quotation was sent by OP No. 3 to the complainant. The OP No. 3 stated that they have acted diligently and have rendered necessary service to the complainants and as such there is no deficiency of service of any nature on their part and the claims raised by the complainants against them are false and frivolous.
14. The parties filed their affidavits in evidence in support of their respective cases.
Arguments have been heard.
15. Shri. R. Bras DSa, the Lr. advocate of the complainants has referred to the situation the complainant No. 2 was placed while he was on his way to Zambaulim particularly with reference to the averments made by the complainants in paras 6 & 7 of the complaint and the photographs produced. Lr. advocate submits that complainant No. 2 was the only person in the said car and therefore there is no question of the car being pushed with a view to start the same after it had stopped. Lr. advocate would submit that complainant No. 2 was aware that the car once it was inundated with water and stopped it could not be restarted and as such the complainant No. 2 did not try to restart the vehicle. Lr. advocate submits that the complainants are entitled to be indemnified for the damage caused to the car on account of the flood. Lr. advocate submits that the complainant No. 2 was placed in a situation where the complainant No. 2 was distressed and had no choice but to make a distress sale of a car to OP No. 3.
16. On the other hand, Lr. Adv. Shri. Kurtikar on behalf of OP No. 1, would submit that the claim of the complainants was repudiated on the basis of the report of a duly licensed surveyor appointed under the relevant provision of the Insurance Act. Lr. advocate submits that the complainants had brought no material on record to contradict the said report of the surveyor. Lr. advocate submits that the complainant No. 2, as can be seen from the very averments made by the complainant No. 2, knew that the road was water logged and was otherwise invisible and because the road was invisible that complainant No. 2 landed in a pothole which made the water to gush into the engine block resulting in hydrostatic lock and in such a situation the complainant No. 2 ought not to have either pushed the vehicle or start it again, causing further damage to the said vehicle. Lr. advocate submits that the complainants case is not supported by any other evidence on record.
17. Shri. N.G. Kamat, lr. advocate on behalf of OP No. 2 would submit that the cars manufactured by OP No. 2 are not amphibians to be driven through water. Lr. advocate submits that there is no reason why OP No. 2 has been joined to the complaint as OP No. 2 is not a necessary nor a proper party and this is the fit case where OP No. 2 is awarded some compensation for having being wrongly impleaded to the complaint. Lr. advocate submits that there is also no explanation as to why in terms of prayer (a) the complainants have claimed a sum of Rs. 50 lacs from OP No. 2 as well. Lr. advocate submits that the complainant No. 2 was entirely negligent in having driven the car through water and therefore the driving skills of complainant No. 2 are questionable. Lr. advocate submits that OP No. 2 had extended a warranty of two years to the vehicle purchased by complainant No. 1 and OP No. 2 had no role to play after expiry of the said warranty. Lr. advocate submits that complainant No. 2 contacted OP No. 2 and they went out of their way to give complainant No. 2 telephone numbers of independent towing service providers as the complainant No. 2 was not eligible to BMW 24 hours roadside assistance managed after a period of two years.
18. Shri. S. Dessai, the lr. advocate of OP No. 3, would submit that the offer to buy back came from no other then the complainants themselves which was accepted by OP No. 3. Lr. advocate would submit that the complainants have given no details of the new purchase made by the complainants by selling the vehicle to OP No. 3 for a sum of Rs. 24,30,000/-. Lr. advocate submits that the complainants have no grievance about the estimates submitted by OP No. 3 and as such there was no deficiency in service on their part.
Lr. advocate submits that OP No. 3 is not responsible for bad conditions of the roads and OP No. 3 could not be expected to keep the complainants vehicle endlessly in as much as the complainants have also not paid any demurrage charges.
19. We have already referred to condition No. 4 of the policy obtained by the complainants.
The policy obtained by the complainants also provided for indemnity against loss or damage to the vehicle by flood, typhoon, hurricane, storm, tempest, inundation, cyclone hailstorm, frost. (see Clause (v) of Section I of the said policy). It is well settled law that a contract of insurance is like any other contract and both the parties are bound by the terms of the contract. The Constitution Bench of the Apex Court in General Assurance Society Ltd., vs. Chandumull Jain and anr. has held that in interpreting documents relating to a contract of insurance, the duty of the Court is to interpret the words in which the contract is expressed by the parties, because it is not for the Court to make new contract, however reasonable, if the parties have not made it themselves. No doubt, OP No. 1 undertook, in terms of the policy to indemnify loss or damage to the vehicle caused by flood, typhoon, hurricane storm, etc. but did it mean that the complainants were free to drive on flooded roads, sustain damage and expect the insurer to indemnify the same? Did the said clause enable the complainants drive through flooded roads and claim compensation for damage caused? Obviously not.
The complainants in terms of Clause 4 were required to take reasonable steps to safeguard the vehicle from loss or damage and to maintain it in efficient condition. Clause (v) Section I had necessarily to be read with condition No. 4. There is an old saying which goes somewhat like this: fools rush in where angels fear to tread. The complainant No. 2 was on his way to Zambaulim at about 5 a.m. on 3/7/13. One who is acquainted with the locality knows very well that whenever there are heavy rains the road from Margao to Zambaulim via Quepem gets submerged at various places. Traffic stops and is diverted. The complainant was driving in the darkness of the night with no road or street lights, with low lying fields on either side fully inundated with water. The road itself must have been invisible except for little which could be seen from the light of the vehicle. If the road was visible, then the complainant No. 2 would not have landed into a pothole which has been described by the complainant No. 2 as a dip of the road which made the vehicle slide and water to gush into the engine block of the vehicle leading to jamming of the engine known as hydrostatic lock. Complainant No. 2 as prudent driver ought not to have ventured to drive on a submerged road inspite of being terrified and knowing that the condition was life threatening. It would have been prudent on the part of the complainant No. 2 to have returned home seeing the floods and the flooded submerged road with water rising from the inundated low lying paddy fields rather than venturing to reach his destination by a road which could not be seen properly. Complainant No. 2 was absolutely rash in continuing to drive the vehicle in the situation particularly described by him in para 6 & 7 of the complaint and if at all the complainants vehicle suffered a hydrostatic lock, complainant No. 2 has no one to blame except himself. Shri. Fernandes, the duly licensed surveyor, has opined that after water entered the engine there was breakdown of the vehicle and after external force was applied or by cranking by the insured to forcibly start the engine the damages to the engine were aggravated. The opinion given by the licensed surveyor has gone unchallenged except for the self serving statements of complainant No. 2. The opinion given by Shri. Fernandes is reasonable and sounds probable. It is more than probable that Complainant No. 2 who was panic stricken in the situation he was placed cranked the engine or tried to restart the car again and which has aggravated the damages. It may be true that complainant No. 2 was all alone in the car but it should not be forgotten that complainants car was pulled out from the submerged road to the dry tarmac, as a complainant calls it, and that was done by pulling the same by an ordinary towing vehicle which must have also aggravated the damage. It is at that stage itself that the complainants vehicle ought to have been removed from the water logged road by a flat bed truck which was only done later and the vehicle was taken to the workshop of OP No. 3. In such a situation OP No. 1, the insurer could not be faulted in repudiating the policy. As rightly pointed out, the complainants vehicle was not an amphibian to be driven through flooded roads, the surface of which could not be seen and it is probably for that reason that the complainants car fell into a pothole or dip of the road, as the complainants call it, which made the vehicle to slide and allow intake of water into its engine.
20. As can be seen from letter dated 3/8/13 it is the complainant No. 2 who approached OP No. 3, the dealer, to give an attractive buy back offer stating that if such an offer was given he would consider purchasing a new BMW X5 and even requested them to try and work out the best possible offer from their end.
The offer to buy back was given by OP No. 3 which was accepted by the complainants and the vehicle was sold, after having run it for over three years and over more than 46,000 kms for a sum of Rs. 24,30,000/-. On facts of the case, the complainants claim that they were compelled to make a distress sale, which is otherwise based on their self serving statements, cannot be accepted.
21. Lastly, we may observe that the complainant No. 1 ceased to be a consumer after the sale of the said vehicle BMW X5 purchased on 19/4/10 to OP No. 3 on or about 3/8/13 and as such the complainants were not entitled to maintain this complaint for any reliefs in relation to the said vehicle. This view of ours finds support in National Commissions decision in Honda Cars India Ltd vs. Jatinder Singh Madan, 2013 (4) CPR 543.
22. In conclusion, we may observe that complainant No. 2 has no one to blame except himself for his acts of omissions or commissions, first having driven the vehicle on a flooded road which was not visible and then either by pulling by force/towing the vehicle or restarting or cranking the engine, which the complainant No. 2 ought not to have done. The complaint, therefore, has got to be considered as frivolous, and, is liable to be dismissed, but considering the facts, with costs of Rs. 5000/- to be paid only to OP No. 2 and 3 each. Costs to be paid within 30 days.
(Smt. Vidhya R. Gurav) (Justice Shri. N. A. Britto) MEMBER PRESIDENT