M.S.CNANASOUNDRI vs Oriental Insurance Co. Ltd.

IN this original petition the facts in brief are that the complainant had taken a fire policy for Rs. 25 lakhs from the opposite party and fire broke out in the premises of the complainant on 8.12.1986. On 10.12.1986 the complainant was served with a notice from the Municipal Corporation, Madras, declaring the building in ruinous state and asked the complainant to take steps to repair the building within seven days and on 26.2.1987 a claim was lodged by the complainant with the INsurance Company for Rs. 25 lakhs. Surveyors were appointed by the opposite party to take inspection of the building. It is very peculiar to note that the Surveyor took inspection of the premises more than 2 years after the fire broke out. The complainant has led evidence that the building was got repaired by obtaining advanced towards rental which was adjusted by them later and also obtained Bank loan for the purpose as the INsurance Company had failed to settle the claim. The complainant also filed a civil suit and thereafter, the present complaint with an undertaking that she will withdraw the civil suit and the civil suit was consequently withdrawn. Even the Architect appointed by the complainant gave an estimate of damage done to the building of Rs. 1 crore.

THE Surveyor appointed by the opposite party estimated the loss at a little more than Rs. 17 lakhs and even that was not paid as the Insurance Company insisted on production of bills for the repair. THE complainant had admittedly failed to produce the bills. THE reason given by her was that her husband who was earlier prosecuting the case had since died and before she could submit those bills to the Insurance Company there was an income tax raid in which all records were seized and that resulted in her inability to produce the bills. The opposite party has defended the claim of the complainant on two grounds : (1) res judiciata in view of the fact as suit was withdrawn in view of the pendency of the original complaint and no final verdict was rendered by any Court earlier, we do not think the plea of res judicata has become available to the opposite party as there was no adjudication of the claim earlier.

We are also unable to accept the estimate of the expert examined by the complainant as he admittedly took inspection of the premises more than one year after the accident. Even the evidence of the witness produced by the Insurance Company, such as Prof. Sankaran, are not worthy of much importance as Prof. Sankaran, witness No. 1, as he never made any statement that Bata on their own carried out the repair. He has also admitted that he has not seen the insurance policy of Bata nor did he take any statement of expenses incurred by M/s. Bata and when he visited the premises after two years and three months of the fire accident, the portion of the building in occupation of Godrej had not yet been repaired. He has also not mentioned anything about repairs having been carried to Vasantham. The second witness Mr. Velayutham has admitted that his testimony was based on the report of Prof. Sankaran and he did not prepare any notes of inspection nor did he record any minutes of discussion with the representatives of M/s. Bata nor did he see the policy that may be held by Bata and that taken by M/s. Godrej or Vasantham Hotel. Even Prof. Sankaran did not keep any minutes of the discussions with the representatives of Bata. Since the opposite party was taking a very strong pleas that the complainant has not suffered any loss because all the repairs had been carried out by the tenants on their own costs and that their respective insurers had compensated all of them. On an enquiry from the Commission to the Counsel as to whether he had collected any information of other Insurance Companies about payment towards repairs to the building. Counsel for the opposite party replied in the affirmative. His answer is, ''Yes. Repairs to the building were passed on the premises of these occupants''. In response to another query as to whether Counsel had made any attempt to ascertain from the sister companies of M/s. Oriental Insurance Co. Ltd., with whom Bata and other have insured as to whether they paid for the repairs. The answer was that, ''I have not''. In the light of these facts, it cannot be presumed that what is stated by the complainant on her having obtained advances from the tenants to carry out the repairs is to be disbelieved as untrue. While the case still pending, the Insurance Company sent one Mr. J. Bhasker without seeking any leave from this Commission to ascertain the facts, but not much light could be thrown in support of their pleas.

WHILE it is true that the bills and receipts should have been produced to the insurer the fact that in the light of the peculiar circumstances of her having lost her records to the Income Tax Authorities and the person who was prosecuting the case having died, she should not have been deprived of the entire claim and, in fact, some estimate could be made of the expenses she had incurred. She has stated that the Bank had charged interest to the tune of Rs. 31 lakhs. It could be further ascertained even though the Counsel for the Insurance Company dispute that statement he could have asked for production of Bank records. Having not done that they cannot take advantage of their own lapse. We feel that some estimate should be made of the expenses likely to have been incurred by the complainant and that the amount should have been paid. It is most unfortunate case of fire insurance which has been lingering on for 15 years. The Insurance Company could have made some interim payment to alleviate the hardship suffered by the insured on account of fire. But no such payment has been made in the present case. The fact of fire is admitted, the fact that premises suffered damage is also admitted. It is also not in dispute that a part of the building had been repaired. It is alleged that she has not suffered any loss because the building was got repaired by the tenants on their own costs. The Surveyors have estimated loss to the building on account of fire and have put the entire claim at Rs. 17 lakhs. It is a very peculiar way of applying the depreciation to repair work has been applied. Depreciation is applied only to the premises and not to the cost of repairs or restoration. The depreciated value of the building had already been taken into account. In view of the absence of the documents to establish the expenses incorrect by the complainant, the value placed by the Surveyors should have been accepted and at least the amount of Rs. 17 lakhs being the loss to the premises should have been paid long ago. That having not happened, we direct the Insurance Company to pay that amount with interest on that amount at the rate of 12% p.a. commencing from two months after the date of fire till the date of actual payment. We further award a sum of Rs. 10,000/- as costs. The complaint is disposed of as above. Complaint disposed of.