IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 25/02/2003
CORAM
THE HONOURABLE MR.JUSTICE A.S.VENKATACHALAMOORTHY
AND
THE HONOURABLE MR.JUSTICE M.CHOCKALINGAM
A.S.No.472 of 1988
1. United India Insurance Co. Ltd.
Divisional Office No.10400
"Lakshmi Bhavan"
III Floor, 609, Anna Salai
Madras 600 006,
rep. by its Assistant Manager
N.Venkataramani
2. Chemicals and Plastics India
Ltd.,
"Dhun Building",
827, Mount Road,
Madras 600 002,
rep. by its Assistant Manager
N.Venkataramani
(Cause title accepted as per
order of Court dated 3.3.88 in
CMP 5056/88) .. Appellants
-Vs-
A.V.R.Transporters & Exporters
Private Limited,
No.59, Bajaj Bhavan,
Nariman Point, Bombay 400 021,
Branch at "Chordia Mansion",
4th Floor, 739, Mount Road,
Madras 600 002. .. Respondent
This appeal suit is filed under S.96 of The Code of Civil Procedure
against the judgment and decree of the VIII Assistant City Civil Judge, Madras
made in O.S.No.1661 of 1985 and dated 31.1.1986.
!For Appellants : Mr.G.Desappan
^For Respondent : Mr.R.Krishnaswami,
Senior Counsel
for Mr.C.Ramesh
:JUDGMENT
M.CHOCKALINGAM, J.
The plaintiffs are the appellants herein.
2. This appeal is directed against the judgment of the learned VIII
Assistant City Civil Judge, Madras dismissing the suit filed by the
appellants/plaintiffs.
3. The appellants/plaintiffs filed the suit for recovery of a sum of
Rs.41,906.85 with subsequent interest at 18% per annum from the date of plaint
till realisation with the following averments:
The second plaintiff has entrusted a consignment consisting of 9150 MT
of Ethylene Dichloride with the respondent/defendant for carriage to their
plant at Metturdam under LR No.53 dated 10.10.1981. The said consignment was
insured with the first pl iff vide policy No.104/83/1/5443/81. The lorry
which carried the consignment met with an accident on 11.10.1981 near Mecheri
enroute to Mettur Dam. On receipt of the said information, the second
plaintiff conveyed the same to the defendant by a letter dated 12.10.1981 to
take necessary action. A reply was sent by the defendant stating that a
police complaint was given. The Senior Divisional Manager of the first
plaintiff firm at Salem arranged for the survey to assess the damage caused to
the consig nment. The surveyors M/s.K.Mariappan Associates submitted their
report on 13.11.1981 stating that the entire consignment was leaked out,
evaporated and mixed with sand and mud resulting in total loss of the
consignment. A claim was made by the second p laintiff with the defendant by
a letter dated 19.7.1982 to compensate the loss sustained by them. A claim
letter dated 12.11.1982 was also sent. But, the defendant neither replied nor
settled the claim made therein. On a claim made by the second plain tiff with
the first plaintiff, the first plaintiff as an insurer settled the claim by
paying a sum of Rs.41,906.85. By virtue of letter of subrogation and special
power of attorney executed by the 2nd plaintiff in favour of the 1st
plaintiff, the rights of the 2nd plaintiff are subrogated to the 1st
plaintiff. Hence this suit.
4. The suit was contested by the defendant by filing a written
statement in the following manner:
The plaintiffs have suppressed the material facts. Pursuant to the
quotation called for by the second plaintiff by letter dated 30.7.1981, the
defendant gave a quotation. The terms of the contract are set down in the
form of confirmation letter g by the 2nd plaintiff dated 21.9.1981. Clause
Nos.3 and 5 of the said terms of confirmation make it very clear the liability
of the defendant carrier. It is true that the lorry was met with an accident
on 11.10.1981. The loss to the consignment is cov ered under Clause 3 of the
said terms of contract. The loss has to be compensated from the insurance
company. The second plaintiff can well recover the money from the first
plaintiff insurance company. The liability of the defendant has been
restricte d only to the loss or damage occasioned to the vehicle employed and
third party risks. The report of the Surveyor would not bind the defendant.
The defendant was not given any notice of any survey. While the second
plaintiff is not entitled to recover any money, the first plaintiff cannot
claim the money on the ground of non delivery of consignment. The loss has
occurred due to the accident which is beyond the control of the defendant.
Hence, the suit may be dismissed with costs.
5. The trial Court framed the necessary issues, tried the suit and
dismissed the same. Being aggrieved by the judgment of the lower Court, the
plaintiffs have come forward with the instant appeal.
6. The plaintiffs laid the civil action for recovery of a sum of
Rs.41,906.85 with subsequent interest. Admittedly, the second plaintiff
entrusted with the defendant carrier a consignment consisting of 9150 Metric
Tonne of Ethylene Dichloride for c age to their plant at Mettur Dam on
10.10.1981. The lorry loaded with the said consignment met with an accident
on 11.10.1981 at 11.30 A.M. near Mecheri enroute to Mettur Dam. On receipt
of the information about the accident, the second plaintiff conve yed the same
to the defendant carrier by a letter dated 12.10.1981 to take necessary action
in that regard. Consequent upon the same, the defendant gave a complaint to
the police and instructed the lorry owner to contact the Plant Manager of the
second plaintiff for conducting an insurance survey. Accordingly at the
instance of the first plaintiff with whom the consignment was insured, a
survey was conducted to assess the damage caused to the consignment due to the
accident. The survey report reveale d that the entire consignment was leaked
out, evaporated and mixed with the sand and mud resulting in total loss of the
same. Under such circumstances, the second plaintiff made a claim with the
defendant by a letter dated 19.7.1982 to compensate the lo ss sustained by
them and again sent another claim letter dated 12.11.1982. But, the claim was
not settled by the defendant. In such circumstances, the second plaintiff
made its claim before the first plaintiff Insurance Company, which settled the
same by paying a sum of Rs.41,906.85 being the value of the consignment. The
second plaintiff subrogated its rights to the first plaintiff to recover the
same from the defendant by a letter of subrogation and special power of
attorney executed by the second plaintiff in favour of the first plaintiff.
7. While the admitted facts are so, the first plaintiff Insurance
Company has made the instant claim against the defendant, wherein the second
plaintiff was also added as a co-plaintiff. The defendant interalia has
vigorously contested the suit sta that no negligence can be attributed to the
defendant for the accident occurred; that the defendant was not liable to meet
the claim of the plaintiffs, in view of the special contract entered into
between the parties before the transportation of the con signment from Madras
to Mettur Dam, wherein the second plaintiff agreed to make arrangements for
the transit risk for the products, and hence, the second plaintiff should
recover the moneys from the insurer namely the first plaintiff.
8. The learned Counsel appearing for the appellants/plaintiffs would
submit that the lower Court was not correct in rejecting the claim of the
plaintiffs; that it is pertinent to note that the accident has occurred due to
the negligence on the part he defendant only; that the defendants themselves
gave the damage certificate accepting the damage caused to the consignment and
its value therefor; that it was not open to them to go back on their own
damage certificate and object to the survey report w hich was only in the
nature of confirmation of the assessment already made; that it has to be noted
that the survey was conducted at the instance of the defendant, and it was
never open to the defendant to contend that they were not bound by the said
sur vey report; that the negligence was always presumed in any accident unless
it had been rebutted by those who pleaded that there was no negligence on
their part; that the lower Court erred in finding the Clause (3) of the
agreement as a special contract b etween the parties; that the said clause
referred only to insurance, and it never referred to restriction of claim on
the part of the first plaintiff; that it is pertinent to note that there could
not be any special contract for giving up any compensatio n due to negligence;
that even if Clause (3) of the contract was to be taken as a special contract,
the same was hit by S.23 of the Contract Act; and hence, the judgment and
decree of the lower Court cannot be sustained, and they are liable to be set
asi de and the suit be decreed as prayed for.
9. Countering to the above contentions, the learned Senior Counsel
Mr.R.Krishnaswami, appearing for the respondent/defendant would contend that
in view of the special contract entered into between the parties before the
transportation of the consign , the respondent was not liable to meet the suit
claim; that the lower Court only on proper appreciation of oral and
documentary evidence has found that the defendant was not liable to make good
the loss, and hence, the judgment and decree of the trial C ourt have got to
be sustained and the appeal be dismissed.
10. After careful consideration of the rival submissions and scrutiny
of the evidence both oral and documentary, the Court is of the considered view
that there is no substance in this appeal.
11. The defendant in its written statement has specifically pleaded
the special contract that was entered into between the parties and has marked
the same as Ex.B2 dated 21.9.1981, wherein the terms of the special contract
were set out. Clause (3) he said contract reads as follows:
“3. INSURANCE:
Chemplast will make arrangements for transit risk for the product only. You
will be fully responsible for any loss, damage, etc., to your chassis, tanker
and crew, it will be your responsibility to insure chassis, tanker, crew and
also cover any third p arty risks.”
A very reading of the above clause would clearly reveal that the second
plaintiff has agreed that they would make arrangements for the transit risk
for the products only viz. the consignment in question. It has also been
further agreed under the said cl ause that the defendant would be responsible
for any loss, damage, etc., for its chassis, tanker and crew and also to cover
any third party risks, which would clearly indicate that the liability of the
defendant was limited to that extent only, and it ca nnot be extended further.
In view of the specific terms of the agreement wherein the second plaintiff
themselves undertook the transit risk for the consignment, they cannot now be
permitted to say that the defendant was liable to make good the loss.
12. Needless to say that the second plaintiff cannot execute a letter
of subrogation in favour of the first plaintiff Insurance Company in respect
of certain rights which were not available for them under the contract entered
into between the partie It was contended by the learned Counsel for the
appellants that there was no special contract between the parties; that Ex.B2
was not a concluded contract, but it was only a letter addressed by the second
plaintiff to the defendant, which was not accepte d by the defendant
subsequently, and thus, the terms found under Ex.B2 would not be binding on
the plaintiffs. This contention cannot be countenanced for two reasons.
Firstly, in the grounds of appeal, the appellants have attacked Clause 3 of
the speci al contract referred to above and not the contract itself, and even
after the terms of the special contract were specifically averred in the
written statement, they were not denied by the plaintiffs by filing a
rejoinder. Secondly, the special contract under Ex.B2 was confirmed by the
second plaintiff under Exs.B3 and B4 communications dated 14.7.1982 and
19.7.12982 respectively. Hence, the plaintiffs cannot now be permitted to
raise any plea stating that there was no special contract between the part
ies.
13. Apart from all the above, the defendant was not put on notice
when the survey was made at the instance of the first plaintiff. P.W.1 who
was examined on the side of the first plaintiff, has categorically admitted
that as per the provisions of I ance Law, all the parties concerned should be
served with notice as to the survey to be made, and in the instant case, no
notice was served on the defendant, and he could not tender any explanation
why the defendant carrier was not served with the necess ary notice before the
survey was made. For all the reasons stated above, the plaintiffs cannot
maintain a claim against the defendant on the basis of Ex.A9 letter of
subrogation. Hence, the lower Court was perfectly correct in dismissing the
suit. The Court is unable to see anything to interfere in the judgment of the
Court below.
14. In the result, this appeal suit is dismissed confirming the
judgment and decree of the lower Court. The parties will bear their own
costs.
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To:
1. The Registrar
City Civil Court
Madras
2. The Record Keeper
V.R.Section
High Court, Madras
nsv/