Karnataka High Court
Kumari Sweta D/O. Pandit Santi vs The Life Insurance Corporation Of India on 6 March, 2023
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RSA No. 2553 of 2007
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 6TH DAY OF MARCH, 2023
BEFORE
THE HON'BLE MRS. JUSTICE K.S.HEMALEKHA
REGULAR SECOND APPEAL NO.2553 OF 2007
BETWEEN:
1. KUMARI SWETA D/O. PANDIT SANTI,
AGED 16 YEARS, REP. BY MINOR GUARDIAN
-GRAND MOTHER, THE APPELLANT NO.2,
SMT. GANGAWWA @ GANGUBAI
W/O. BASAPPA SANTI.
2. SMT. GANGAWWA @ GANGUBAI
W/O. BASAPPA SANGI,
AGED ABOUT 65 YEARS,
R/AT NEAR JAGADISHWAR TEMPLE,
KADAPATTI, TQ: JAMKHANDI,
DIST: BAGALKOT-587301.
...APPELLANTS
(BY SMT DEEPA P. DODDATTI, ADVOCATE FOR
SRI MRUTYUNJAY TATA BANGI, ADVOCATE)
AND:
1. THE LIFE INSURANCE CORPORATION OF INDIA,
Digitally
signed by
VIJAYALAXMI
REP. BY ITS BRANCH MANAGER,
M BHAT
VIJAYALAXMI Location: JAMKHANDI BRANCH, KUNCHNUR CIRCLE,
M BHAT DHARWAD
Date:
2023.05.11 JAMKHANDI, DIST: BAGALKOT-587301.
15:49:13 -
0700
2. THE DIVISIONAL MANAGER,
THE LIFE INSURANCE OF INDIA,
DIVISIONAL OFFICE, SWAROOP PLAZA,
SUKRAWAR PETH, TILAKWADI,
BELGAUM-590001.
...RESPONDENTS
(BY SRI NARAYAN V. YAJI, ADVOCATE FOR R-1 AND R-2)
THIS RSA IS FILED U/S. 100 OF CPC AGAINST THE
JUDGEMENT & DECREE DATED 6.7.07 PASSED IN R.A.NO.3/2007 ON
THE FILE OF THE DIST. & SESSIONS JUDGE, & P.O. FAST TRACK
COURT, JAMAKHANDI, DISMISSING THE APPEAL AND CONFIRMING
THE JUDGEMENT AND DECREE DATED 23.12.2006 PASSED IN OS
154/02 ON THE FILE OF THE PRL. CIVIL JUDGE, (SR.DN),
JAMAKHANDI.
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RSA No. 2553 of 2007
THIS RSA COMING ON FOR FINAL HEARING THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
This Court while admitting the appeal vide order dated 22.10.2009 has framed the following substantial question of law:
"Whether the Courts below were justified in holding that there was violation of good faith by the deceased in respect of whose death the insurance policy was sought to be encashed in the face of the fact that the policy was non-medical?."
2. Learned counsel for the appellant and the learned counsel for the respondent have been heard on the substantial question of law framed by this Court.
3. The present appeal is filed by the unsuccessful plaintiff aggrieved by the judgment and decree dated 06.07.2007 in R.A.No.03/2007 on the file of the Fast Track Court at Jamkhandi, confirming the judgment and decree dated 23.12.2006 in O.S.No.154/2002 on the file of Principal Civil Judge, (Sr. Dn.), Jamkhandi. -3- RSA No. 2553 of 2007
4. The parties herein are referred to as per their ranking before the trial Court for the sake of convenience.
5. The brief facts of the case are that, plaintiff is the daughter of one Sri Pandit S/o. Basappa Santi filed a suit for recovery of insurance policy amount of Rs.50,000/- through her grand-mother next friend and minor guardian Smt.Gangawwa. The father of plaintiff No.1 and son of plaintiff No.2 was serving as First Division Assistant in the G.L.B.C. Division-II Irrigation Department, Jamakhandi. It is averred in the plaint that the said Pandit s/o. Basappa Santi during his lifetime, had taken a life Insurance Policy bearing No.633870063 for a sum of Rs.50,000/- in the year 1998 and the premium was regularly deducted from his salary. It is averred that he died on 11.02.1999 at his house and prior to his death, he was suffering from loose motion and vomiting, which has resulted in the sudden death of the said Sri Pandit S/o Basappa Santi. Plaintiffs requested the defendants to pay the policy claim amount, but the Life Insurance Corporation had repudiated the death claim of the -4- RSA No. 2553 of 2007 deceased on the ground that the deceased had not disclosed the diseases in good faith.
6. Pursuant to the summons ordered by the trial Court the defendants appeared and filed their written statement inter alia contending that the policy issued in favour of the deceased Sri Pandit S/o Basappa Santi was on the ground that the assured was hale and healthy at the time of proposal for Insurance policy dated 14.08.1998 and the defendants have repudiated the contract on the ground of suppression of material facts concerning the health of the life assured furnishing of false information despite the prescribed proposed form demanding specific information from life assured in column No.11 under declaration about the truth of the statement. It is further stated that the repudiating of the contract was for violation of the "faith and trust" by life assured by suppressing material facts and submitting false information. It is further stated that thelife assured died within 05 months 27 days from the date of proposal for the insurance, due to lever failure and Neurology pain with symptoms of illness being loose -5- RSA No. 2553 of 2007 motion as per claim Form-B dated 26.03.1999. It is stated that in view of short duration between proposal for insurance and date of death, claim investigation as per the norms of the Corporation was conducted into the background of earlier claim. During the claim investigation, it was found that life assured had availed treatment from 01.09.1997 from Dr.V.V.Kittur, Jamakhadi for loose motion and fever. It is also stated that the life assured availed sick leave as many as 134 days prior to the date of proposal for insurance and it is stated that life insurance contract is based on well settled principles of "Uberrima Fides" i.e., "Utmost good faith" and according to the principles it was the duty of the life assured to disclose the facts about the insurability while answering the questions in the proposal form faithfully and honestly. It is also stated that the action of the plaintiffs is premature, without exhausting all the avenues available for them for redressal of the grievances and Life Insurance Corporation of India is a business organization conducting in life insurance business in larger interest of the society on the policy holder, which cannot -6- RSA No. 2553 of 2007 pay the claims where the insurance contract is obtained by suppression of material facts and sought to dismiss the suit.
7. On the basis of the pleadings of the parties, the trial Court framed the issues:
"1. Whether plaintiffs prove that, sudden death of life assured Pandit was caused as a result of serious loose motion and vomiting?
2. Do they further prove that, after the sudden death of Pandit defendants are under legal obligation to settle the claim and to pay the policy amount to the nominees; plaintiff No.1?
3. Whether defendants prove that, much earlier to taking of suit insurance policy, Pandit was suffering from liver failure, Neurology pain, Dysentery but he has intentionally failed to disclose that material aspect therefore plaintiff's claim is hit by the principles of "Uberria fides"; "utmost good faith"?
4. Do they further prove that, due to the fault of life assured competent authority of defendants Corporation has repudiated the suit claim?-7- RSA No. 2553 of 2007
5. Whether plaintiffs are entitled for recovery of suit policy amount from defendants as prayed?"
8. The trial Court dismissed the suit of the plaintiffs with costs, based on pleadings, material on record, oral and documentary evidence holding that:
i) the plaintiffs have failed to prove the sudden death of life assured was caused as a result of severe loose motion and vomiting;
ii) the plaintiffs have failed to prove that sudden death of deceased Pandit, the defendants were under legal obligation to settle the claim and to pay the policy amount to the nominees-plaintiff No.1;
iii) the defendant proved that much earlier to taking of the insurance policy deceased Pandit was suffering from lever failure, Neurology pain, loose motion and intentionally failed to disclose the material aspect and therefore plaintiffs claim is hit by "Uberrima Fides" i.e., "Utmost good faith" and due to the fault of life assured, -8- RSA No. 2553 of 2007
9. Aggrieved by the judgment and decree of the trial Court, the plaintiffs preferred the appeal before the first appellate Court for recovery of the insurance claim. The first appellate Court framed the following points for consideration:
"1. Whether the defendants prove that the deceased earlier to taking of the suit insurance policy was suffering from liver failure, Neurology pain etc, but he has intentionally suppressed the material facts therefore, the claim of plaintiffs is hit by the principle of "Uberria fidos, as a result the Corporation repudiated the claim?
2. Whether the trail Court judgment and decree required interference by this Court?"
10. The first appellate Court, on re-appreciation of material facts, confirmed judgment and decree of the trial Court. Aggrieved by the concurrent findings of the trial Court and the first appellate Court, the present appeal is preferred by the plaintiffs.
11. Learned counsel for the appellants would contend that the policy obtained by the deceased was non- -9- RSA No. 2553 of 2007 medical policy and respondent could not have repudiated the policy. It is further contended that after having received the premium from the salary of the deceased, the policy could not have been repudiated on the ground that the statement made by the deceased was false when admittedly during the life time of the deceased, the policy was not repudiated and thus, the repudiation of the policy after the death of the deceased cannot be sustainable and the benefit be denied to the minor appellant. Learned counsel would also contend that the leave sought by the deceased was sick leave and that cannot be a ground for the Courts below to come to a conclusion that the deceased was suffering from prior ailments before taking the insurance policy and the Courts below were not justified in dismissing the suit of the plaintiffs in the absence of any proof that the deceased had fraudulently obtained insurance policy contrary to the settled principle of "Uberrima Fides" i.e., "utmost good faith" and sought to allow the appeal.
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RSA No. 2553 of 2007
12. Per contra, learned counsel appearing for the respondents-insurance company vehemently contended that, at the time of issuance of policy (Ex.P-18), the deceased-life assured has suppressed the material fact that he is having ill-health and as such, the deceased-life assured would fall under the category of "Uberrima Fides"
i.e., "Utmost good faith" and the claims of such nature cannot be sustained. Accordingly, he would submit that the trial Court and first appellate Court are right in dismissing the suit seeking the insurance claim and hence, sought to dismiss the appeal.
13. Heard the learned counsel for parties and perused the material on record.
14. It is undisputed fact that the life assured was serving as First Division Assistant in G.L.B.C. Division-II Irrigation Department, Jamakhandi, and plaintiff No.1 is the only daughter and plaintiff No.2 is the mother of the life assured and material on record would depict that the wife of the life assured expired in the year 1995 and he
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RSA No. 2553 of 2007had lost his son in the year 1997. Ex.D.8 which is relied upon by the learned counsel for the respondents to contend that suppressing the fact about illness, the insurance policy has been obtained. Ex.D.8 would evidence that in column (1), the date on which the deceased had taken earned leave on medical grounds and the same reads as under:
"ªÀiÁ£ÀågÉà ¢B ¦ © vÀAw ¥ÀæxÀªÀÄ zÀeÉð ¸ÀºÁAiÀÄPÀ EªÀgÀÄ F PÁAiÀiÁð®AiÀÄzÀ°è ¢£ÁAPÀ 14-1-99 gÀAzÀÄ PÉ®¸ÀPÉÌ ºÁdgÁVgÀÄvÁÛgÉ. ¸ÀzÀjAiÀĪÀgÀÄ gÀeÉAiÀÄ ¥ÀqÉzÀ «ªÀgÀ F PɼÀV£ÀAvÉ £ÀªÀÄÆ¢¹ ªÉÊzsÁå¢üPÁjUÀ¼À ¥ÀæªÀiÁt ¥ÀvÀæzÀ gÉhÄgÁPïì ¥ÀæwAiÀÄ£ÀÄß ®UÀwÛ¹ vÀªÀÄä ªÀÄÄA¢£À ¸ÀÆPÀÛ PÀæªÀÄPÁÌV gÀªÁ¤¸À¯ÁVzÉ.
C£ÀA ¢£ÁAPÀ öAiÀiÁªÀ «zsÀªÁzÀ gÀeÉ µÀgÁ
EAzÀ ªÀgÉUÉ
1) 1-9-97 jAzÀ 7-9-97 ªÉÊzsÀåQÃAiÀÄ DzsÁgÀzÀ ªÉÊzsÀåQÃAiÀÄ ¥ÀæªÀiÁt
ªÉÄÃ¯É UÀ½PÉAiÀÄ gÀeÉ ¥ÀvæÀ ®UÀwÛ¸À¯ÁVzÉ
2) 1-12-97 ' ' 30-12-97 UÀ½PÉAiÀÄ gÀeÉ (¸ÀgÀAqÀgï)
3) 4-1-99 ' ' 14-1-99 ªÉÊzsÀåQÃAiÀÄ DzsÁgÀzÀ ªÉÊzsÀåQÃAiÀÄ ¥ÀæªÀiÁt ªÉÄÃ¯É gÀeÉ ¥ÀvæÀ ®UÀwÛ¸À¯ÁVzÉ
4) 3-2-99 jAzÀ 24-2-99 ªÉÊzsÀåQÃAiÀÄ DzsÁgÀzÀ ªÉÄÃ¯É UÀ½PÉAiÀÄ gÀeÉ"
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RSA No. 2553 of 2007
15. Perusal of Ex.D-8 would indicate that from 01.09.1997 to 07.09.1997, he had obtained leave on medical grounds. Subsequently, from 01.12.1997 to 30.12.1997 the life assured had surrendered earned leave and again he had obtained leave on medical grounds from 04.01.1999 to 14.01.1999 as well as from 03.02.1999 to 24.02.1999
16. Ex.D.15 is the insurance policy, which was obtained on 11.12.1998 and the conditions in column No.11 showing the personal history reads as under:
Personal History: Answer If 'Yes'
'Yes' or please give
'No' full details
a. During the last five No
years did consult a Medical 11(j) Have
Practitioner for any ailment you ever
requiring treatment for received or at
more than a week? present
availing
b. Have you ever been No undergoing
admitted to any hospital or medical
nursing home for general advice.
check-up, observation, Treatment or
treatment or operation? tests in
Connection
c. Have you remained No with Hepatitis
absent from place of work B or an AIDS
on grounds of health related
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RSA No. 2553 of 2007
during the last 5 years? Condition?
d. Are you suffering from No
or have you ever suffered
from ailments pertaining to
Liver, Stomach, Heart,
Lungs, Kidney, Brain or
Nervous system?
e. Are you suffering from No
or have you ever suffered
from Diabetes,
Tuberculosis, High Blood
Pressure, Low Blood
Pressure, Cancer, epilepsy,
Hernia, Hydrocele, Leprosy
or any other disease?
f. Do you have any bodily No
defect or deformity?
g. Did you ever have any No
accident or injury?
h. Do you use or have you No
ever used alcoholic drinks,
narcotics or any other
drugs?
i. What has been your Good
usual state of health?
In Non-Medical cases, Height Weight
please state exact Height 179 68
in Cms. And Weight in
Kgs. (without shoes)
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RSA No. 2553 of 2007
17. This portion evidences that the life assured had no medical history or a treatment nor any suffering from liver, stomach, heart, lungs, kidney, brain or nervous system and subsequently, after obtaining the life insurance policy, the life assured died on 11.02.1999.
18. Ex.D.8 makes it evident that there is a mention of leave from 03.02.1999 to 24.02.1999, whereas the life assured died on 11.02.1999. The said document relied upon by the Courts below to come to a conclusion that the life assured has violated the principles of life insurance contract "Uberrima Fides" i.e., "Utmost good faith". What can be gathered from the material on record is that life assured had no ailment of any such nature and that the life assured had not been diagnosed with any life threatening illness or any pre existing illness prior to obtaining of the insurance policy. Other than Ex.D.8, no other material is placed by the defendants-insurance company to show that life assured was suffering from any pre-existing ailments.
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RSA No. 2553 of 2007
19. Ex.D.17 is the medical attendance certificate, which would also evidence that the life assured was not having a prolonged suffering from any disease before his death as is evident from Column No.4, which reads as under:
[a] What was the exact a] Primary cause:
cause of death? Leaver Failure [Besides defining the disease or other cause of death in Secondary cause: such terms as you consider Neurology pain appropriate, Kindly add the distinctive technical name.] [b] Was it ascertained by b] -No-
examination after death or infered from symptoms and appearance during life.
[c] How long had he been c] Don't known suffering from this disease before his death?
[d] What were the symptoms d] loose motion and of the illness? vomiting [e] When were they first e] 11-2-99 observed by the deceased?
[f] What was the date on f] 11-2-99 which you were first consulted during the illness?
[g] Did you attend him g] -No -
during the whole of its course?
if not state during what period.
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20. Having perused Ex.D.17 making it evident that the certificate does not disclose since when the deceased was suffering from the particular disease as the reason mentioned for death is liver failure. Though the learned counsel for the respondent would contend that the life assured was aware of the fact while making a declaration that if any statements were untrue or inaccurate or if any material of the proposal was not disclosed, the insurer may cancel the contract and forfeit the premium. The materials on record would reveal that the life assured had not suppressed any material fact as is evident from Exs.D-
8 and D-17 and the Courts below without taking into consideration the principle of "Uberrima Fides" i.e., "Utmost good faith" is not applicable to the present case and hence, dismissed the suit of the plaintiff on misconception.
21. There is no material produced by the respondents-insurance company to show that at the time of taking the policy, the life assured was suffering from
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any type of life threatening disease as mentioned in the said life insurance policy obtained as per Ex.D.15. The trial Court and first appellate Court, based on the assumption that the leave has been taken by the life assured for a period of 134 days before obtaining the insurance policy, have erroneously come to the conclusion that the plaintiffs' suit for recovery of insurance amount due to the death of the life assured is not entertainable and dismissed the suit on its entirety.
22. In the present case, the life assured, as indicated above, has not concealed any pre-existing ailment and the repudiation by the insurance company applying the principle of "Uberrima Fides" i.e., "Utmost good faith" is not justifiable.
23. This Court has carefully perused the material on record and the evidence to that effect, which clearly shows that there was no medical ground for which the leave was taken by the life assured. On the contrary, the life assured had taken leave from 01.09.1997 to 07.09.1997 and from
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RSA No. 2553 of 200701.12.1997 to 30.12.1997 and there is a mention at Ex.D.8 that the life assured had taken leave from 03.02.1999 to 24.02.1999, whereas, life assured passed away on 11.02.1999 and the respondents-defendants are unable to substantiate the leave taken by the life assured during that period. In view of the same, the substantial question of law framed by this Court needs to be answered in favour of the appellants holding that there is no violation of the faith by the deceased in respect of whose death the insurance policy was sought to be enacted on the face of the fact that the policy is a non-medical and appellants-plaintiffs have proved that they are entitled for insurance claim of the deceased Pandit. Accordingly, this Court pass following:
ORDER a. The Regular second appeal filed by plaintiff is hereby allowed.
b. The impugned judgment and decree dated 06.07.2007 in R.A.No.03/2007 on the file of the Fast Track Court at Jamkhandi, confirming the judgment and decree dated 23.12.2006 in O.S.No.154/2002 on the file
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of Principal Civil Judge, (Sr. Dn.), Jamkhandi is hereby set aside.
c. The suit of the plaintiffs is hereby decreed for recovery of the insurance amount due to deceased Pandit S/o. Basappa Santi.
Sd/-
JUDGE AC List No.: 1 Sl No.: 55