State Consumer Disputes Redressal Commission
Mr. Michael Viegas, vs United India Insurance Co. Ltd., on 15 November, 2013
BEFORE GOA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PANAJI GOA FA No. 75/13 Mr. Michael Viegas, 2/C/S-1, Models Estate II, Kerant, Caranzalem, Tiswadi, Goa. ..Appellant/ Complainant V/s. United India Insurance Co. Ltd., Mascarenhas Building, 2nd Floor, Mahatma Gandhi Road, Panaji Goa. ...Respondents/ Opposite Party Appellant/Complainant is represented by Adv. Shri E. Afonso Respondent / OP is represented by Adv. Shri A. R. S. Netravalkar Coram: Shri. Justice N.A. Britto, President Smt. Vidhya R. Gurav, Member Dated: 15/11/2013 ORDER
[Per Justice Shri. N. A. Britto, President] In this appeal, filed under section 15 of the Consumer Protection Act, 1986, the Complainant in CC No.11/2012 seeks enhancement of compensation.
2. Some facts need to be narrated for getting hang of the case and the issues of law raised by the Complainant.
3. The Complainant is the owner of a Toyota Innova having registration no.GA-07-C-1256. The Complainant obtained from the OP a comprehensive insurance policy declaring its value (IDV) as Rs.
6,00,000/-, valid from 22/01/2010 to 21/01/2011. One of the limitations of the said policy was that the vehicle could not be used for hire or reward.
4. The Complainant went on a pilgrimage tour to Vailankani, and according to him, he went with his family friends on 11/05/2010. On the way back, on 15/05/2010, the Complainant met with an accident at Shiggao, Haveri District in Karnataka. The front wheel got shapped and the vehicle dashed against a road divider. The vehicle was severely damaged. The occupants were injured.
5. The Complainant reported the accident to the OP as well as to Tadas Police Station. The Complainant shifted the vehicle to its dealer at Verna, Goa. The Complainant furnished an estimate of the loss from the dealer of the vehicle Sarayu Toyota.
6. The OP on or about 22/06/2010 appointed Shri Tejpal P. Diwani, Surveyor, Loss Assessor, Valuer and Investigator who submitted his report dated 26/08/2010 and in the said report the said Surveyor Shri Diwani recommended settlement of claim on total loss basis, which according to him, was the most economical mode of settlement, for which the insured had agreed. The Surveyor took the IDV at Rs. 6 lacs, value of the wreck as Rs. 2 lacs, and fixed OPs liability on a total loss basis at Rs. 4 lacs.
7. As the claim was not settled by the OP on the basis of the said Surveyors report, the Complainant addressed several letters calling upon the OP to settle the claim and by another letter dated 26/02/2011 the Complainant called upon the OP to settle his claim, failing which the Complainant said he would approach the Consumer Forum.
8. The OP then obtained a report dated 15/03/2011 from K. B. Shellikeri, a retired PSI and Insurance Claim Investigator, who informed the OP that a crime was registered against the Complainant under Cr. No.32/10 under section 279, 337, 338, 304A IPC.
9. Still not satisfied with two reports, the OP by letter dated 21/04/2011 called for a report from Facts Finders and they submitted their report on 03/05/2011. In the course of his investigations, Shri Mathew Peris, Chief Investigator of Facts Finders is purported to have obtained a letter from two of the occupants of the vehicle in which it is claimed that one Antonio was paid Rs.30,000/- which included rental charges of the car as well as food and hotel charges, at the same time, stating that they did not know how much the said Antonio had paid to the Complainant. The said Antonio Araujo is stated to have expired of a wound which could not be healed due to diabetes.
10. By letter dated 11/07/2011 the claim was rejected stating that as per investigation carried out by their office, it was noted that the Complainant had used the vehicle for hire/reward i.e. for commercial purpose.
11. The Lr. District Forum has allowed the complaint on non standard basis and has awarded Rs. 3 lacs to the Complainant i.e. 75% of Rs. 4 lacs which was assessed as total loss by the Surveyor, and has directed the same to be paid with simple interest @ 9% from 11/07/2011 plus costs of Rs.5,000/-.
12. We have perused the records and heard the lr. advocates appearing for the parties.
13. The records would show that the Complainant by his application dated 29/06/2012 had called upon the OP to produce the guidelines for settling the claims on non-standard basis but the said application was vehemently opposed by the OP but later the Complainant filed his affidavit in evidence stating that in C.C. No. 62/2009 the claim was settled at 75% of total loss in case of breach of policy condition.
Condition no. 3 was reproduced in the said affidavit.
14. This controversy continued even before this Commission. Shri Afonso, the lr.
advocate of the Complainant produced the insurance guidelines of settling the claims on non-standard basis, particularly condition III (a) which says that 75% of the admissible claim can be paid in case of any other breach of warranty/condition of policy including limitation as to use. However, lr. advocate Shri Netravalkar was not willing to confirm the existence or authenticity of the said guideline. Lr. advocate would submit that he has not come across with any such guidelines. However, the case cited by him, Amalendu Sahoo vs. Oriental Insurance Co. Ltd., 2010 (4) SCC 536 clearly shows that claims are being settled on non-standard basis as per the said guidelines and infact the very case of Amalendu Sahoo shows that the claim was settled on non-standard basis on the face of the allegation by the Insurance Co. that the claimant had used the vehicle for hire, further observing that the Insurance Co. could not repudiate the claim in toto.
15. Shri Afonso, the lr. advocate of the Complainant would submit that the Complainant is a businessman having two companies and did not require to take people on hire. Lr. advocate submits that the OP opposed the production of the guidelines before the Lr. District Forum but the Lr. District Forum relying on such guidelines, relied earlier, awarded to the Complainant 75% of Rs.4,00,000/-. Lr. advocate submits that the Lr. District Forum ought to have awarded to the Complainant compensation of Rs. 6 lacs. Referring to report dated 03/05/2011, lr. advocate submits that there was no particular reason for the two occupants of the car to have written a letter to the Divisional Manager of the OP which letter according to the lr. advocate has been fabricated by the said Facts Finders. Lr. advocate submits that the affidavit filed by the said Facts Finders is contrary to the said letter. Relying on Sarvalaxmi Marines 2007 STPL (CL) 1675 and two other unreported decisions of this Commission in CC No. 2 of 2013 filed by Bhupender Gahlawat and CC No. 07 of 2013 filed by Rajkumar Tomar, lr. advocate submits that the report of a private Investigator Facts Finders could not have been relied upon. Lr. advocate Shri Afonso has placed reliance on Nitin Khandelwal, 2008 (11) SCC 259/2013(3) CPR 644 wherein it is held that in a case where vehicle is stolen, the breach of condition is not germane.
16. On the other hand, Shri Netravelkar would submit that the Complainant was charge sheeted for various offences including under section 304A IPC. Lr. advocate submits that the OP had not asked the Complainant to bring the vehicle to Goa and it is he who brought it at his own will. Lr. advocate further submits that it is the Complainant who was bound to give the translations of the Police documents which were in Kannada language and the OP cannot be blamed for the same.
17. Admittedly, a crime was registered against the Complainant at Tadas Police Station for various offences including under section 304A IPC. The very documents obtained by Facts Finders would show that Anunciacao Araujo Rodrigues, one of the occupants in the car, died of a heart attack and Antonio Araujo another occupant, died on 30/10/2010 of a wound which he received in the accident, which could not heal due to diabetes. If that be the case, the Complainant was bound to be acquitted for the said offences, as submitted by lr. adv. Shri Afonso. However, we must hasten to add that the outcome of the said cr. case filed against the Complainant, has no relevance to his complaint at all.
18. The delay in settling the claim has been admitted by the OP in paras 11, 12 & 13 of the written version, the reasons being that as the accident had taken place in Karnataka, records were required to be translated, the claim was beyond financial powers of Divisional Office and the vehicle having been used for hire or reward.
19. Did the OP prove that the Complainants vehicle was used by him for hire or reward?
20. The answer has got to be in the negative. The licensed Surveyor Shri Diwani did not find that the vehicle was so used. So also Shri Shellikeri. Here it may be stated that the duties and responsibilities of a Surveyor/Loss Assessor are set out by Regulation 13 of the Regulations of 2000 and a surveyor or loss assessor is required to examine, inquire, investigate, verify and check upon the causes and circumstances of the loss in question including extent of loss, nature of ownership and insurable interest and also to estimate, measure and determine the quantum and description of the subject under loss. In case the Complainant had used the vehicle for hire or reward the Surveyor would have certainly come to know about the same. The report of the surveyor was accepted. We say so because the OP did not seek any further information from the surveyor or seek additional report, as required under clause 9(3) of the IRDA (PPI) Regulations of 2002. In the case of Rajkumar Tomar (Supra) this Commission by order dated 08/10/13 has held that:
a licensed surveyor occupies an important position under the scheme of section 64 UM of the Act of 1938 and the Regulations of 2002 framed thereunder. No claim of more than Rs.20,000/- can be settled by an insurer unless a report is obtained from him or otherwise directed by the Regulatory Authority. In giving a report, a surveyor performs a statutory function and as such a report submitted by him carries great evidentiary value unless proved otherwise.
21. This Commission in New India Assurance Co. Ltd., 2012 (4) CPR 22 has followed the view taken by National Commission in several cases:
the report of a Surveyor is an important document and cannot be brushed aside and the assessment made therein has to be specifically agreed or rebutted. In this case we find that there is no rebuttal to the report of the surveyor by any other report of equivalent weight.
Again, the National Commission in the case of Oriental Insurance Company Ltd., has stated that the surveyors report is an important piece of evidence and the respondent can be awarded compensation only on the basis of the surveyors report.
22. The Honble National Commission in Ravindra Nath Fruit Canning Industry (P) Ltd., 2006 (1) CPR 270 (NC) has held that:
This Commission has taken a consistent view that under Section 64 UM, Insurance Company cannot go on appointing Surveyors one after the other so as to get a tailor made report to the satisfaction of the concerned officers.
Stringent action is provided against surveyor or loss assessor who is guilty of breach of his duties or willfully making of false statement or acting in a fraudulent manner, entailing cancellation of license given to him.
The Commission has further reiterated that:
Appointment by the insurer of a second surveyor itself would be a reflection on the conduct of the first surveyor.
23. Again, the National Commission in M/s.
Jaganath Power Tyres, 2012 (1)CPR 242 has held that it is permissible to appoint a second surveyor by giving reasons and only through the auspices of the regulatory authority i.e. IRDA.
24. It appears that the OP was not satisfied in settling the claim based on the said Surveyors report and for extraneous reasons wanted to reject the claim and for that reason the OP first appointed Shri Shellikeri who also did not give a report as desired by the OP and thereafter appointed the said Facts Finders. One fails to understand as to whether the OP did not know that the occupants were from Goa at the time of appointing the said Shellikeri to investigate into the accidental damage caused to the vehicle. It therefore becomes obvious that the OP was looking out for a tailor made favourable report so as to reject the claim.
25. This Commission in CC. No. 2/13 filed by Bhupender Gahlawat by order dated 01/11/2013 has held as follows:
We have noticed that there is a practice among the insurers to appoint investigators or facts finders in addition to a surveyor duly licensed under the provisions Section 64 UM of the Insurance Act, 1938. We have held in CC No. 07/13 by order dated 08/10/13 in a case filed by Rajkumar Tomar that such a practice is prima facie opposed to Sub Section 5 of Section 64 UM of the Insurance Act, 1938 in claims valued more than Rs.
20,000/-. Therefore, based on the above two decisions the said report needs to be ignored or discarded.
26. The National Commission in the case of Sarvalakshmi Marines, 2007 STPL (CL) 1675 has held that:
In our view, the State Commission completely failed in giving the importance it deserves, to the report of the licensed surveyor and went on a tangent to exclusively rely upon the report of an investigator, who had no authority under the law to carry out investigation. In any case, he was neither qualified nor licensed to do so, not to say law does not permit the respondent to appoint such investigator as already discussed earlier.
27. In view of the above two decisions, the report of Facts Finders needs to be ignored or discarded. The said report dated 03/05/2011 therefore falls flat along with its conclusion. So also the report dated 15/03/11 of Shri Shellikeri. Once the report dated 03/05/2011 is discarded, the plea of the OP that the vehicle was used for hire or reward also needs to be rejected and the claim of the Complainant settled on the basis of Surveyors report. The Complainant is therefore entitled to Rs.6,00,000/- in terms of prayer 9(a) of the complaint. Consequently the vehicle/wreck shall be the property of the OP to be dealt by them in a manner they please.
28. The Complainant is also entitled to compensation for harassment, mental and emotional suffering etc. by way of additional liability arising from the charge of deficiency of service, as defined under section 2(1)(g) of the Consumer Protection Act, 1986, as held by this Commission by order dated 04/10/2012 in FA No.12/12 in the case of M/s. Jet Airways (India) Ltd. & anr. vs. Ms.Urjita V. Damle relying on Ghazaiabad Development Authority 2004 (5) SCC 65 and Alok Tandon vs. Scandinavian Arlines 2001 CTJ 85.
29. For reasons aforesaid, we allow the appeal and modify the impugned order. Consequently the Complainant will be entitled to compensation of Rs. 6 lacs in terms of prayer (a) of the complaint, Rs. 50,000/- in terms of prayer (d) of the complaint and costs of this appeal which are assessed at Rs.10,000/- in addition to Rs.5,000/- being the costs of the complaint to be paid by the OP. Rs. 6 lacs shall carry interest @ 9 + 2% from 26/08/2010 (30 days from the report) until payment. The sums ordered to be paid shall be paid to the Complainant within 30 days or else they shall be paid with interest @ 9% till they are paid.
30. Before concluding, we must deprecate the practice on the part of some of the Divisional Managers/claim settlement committees of ignoring the reports of duly licenced surveyors and so also ignoring the Regulations of 2002, referred to hereinabove, and go on appointing private investigators so as to get a way out to reject the claim.
[Smt. Vidhya R. Gurav] [Justice Shri N. A. Britto] Member President /lm