Skip to content


Rohini Nandan Goswami Vs. Ocean Accident and Guarantee Corporation Ltd. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata High Court
Decided On
Case NumberSuit No. 230 of 1955
Judge
Reported inAIR1960Cal696
AppellantRohini Nandan Goswami
RespondentOcean Accident and Guarantee Corporation Ltd.
Appellant AdvocateS.K. Mukherjee and ;A.K. Guha, Advs.
Respondent AdvocateAnil C. Mitra, ;Ajit Sarkar and ;Ajay Ghosh, Advs.
Cases ReferredBare v. Turner
Excerpt:
- p.c. mallick, j.1. this is a suit to enforce a claim on a fire and burglary insurance policy issued by the defendant in favour of the plaintiff. the policy is dated 13-7-1954 and the period covered by the policy is one year from 1-7-1954. the proposal on the basis of which the policy was issued is dated 26-6-1954. the properties insured are (i) furniture, household goods and personal effects valued at rs. 7,000/- and (ii) trinkets, personal ornaments and gold sovereigns valued at rs. 23,000/-. all the said properties were lying in the first floor of premises 6, gonesh chatterjee avenue, sibpore, howrah, in the occupation of the plaintiff. it is alleged in the plaint that on 5-8-1954 there was a burglary and considerable ornaments, silver utensils and benarasi saries covered by the policy.....
Judgment:

P.C. Mallick, J.

1. This is a suit to enforce a claim on a fire and burglary insurance policy issued by the defendant in favour of the plaintiff. The policy is dated 13-7-1954 and the period covered by the policy is one year from 1-7-1954. The proposal on the basis of which the policy was issued is dated 26-6-1954. The properties insured are (i) furniture, household goods and personal effects valued at Rs. 7,000/- and (ii) trinkets, personal ornaments and gold sovereigns valued at Rs. 23,000/-. All the said properties were lying in the first floor of premises 6, Gonesh Chatterjee Avenue, Sibpore, Howrah, in the occupation of the plaintiff. It is alleged in the plaint that on 5-8-1954 there was a burglary and considerable ornaments, silver utensils and Benarasi saries covered by the policy were stolen and have not been recovered. Particulars of the goods stolen have been set out in paragraph 4 of the plaint. The value of the property stolen has been stated to be Rs. 16,889/-, Due notice of the burglary was given to the police and the defendant. So also the claim, form was duly filed as required by the policy. The defendant having failed and neglected to pay the amount of the loss the present suit has been instituted on 25-1-1955.

2. The defendant company is disputing liability and has filed a written statement contending that the plaintiff is guilty of false answer to a question in the proposal form as also of suppression of fact. The negative answer to Q. 7(a) in the proposal form is false. Q. 7(a) in the proposal is in the following terms:

'Have you ever sustained a loss by fire, burglary, house-breaking and larceny?'

3. It is alleged in paragraph 4 of the written statement that previously in the month of Falgun 1355 B.S. there was a burglary in the house of the plaintiff. In this burglary, ornaments, clothes and other valuables worth Rs. 1,650/- belonging to the plaintiff and/or his wife were alleged to have been stolen. This fact has been suppressed when the policy was effected. This non-disclosure of fact is alleged to invalidate the policy. It is further contended that the policy was subject to the condition that all benefits under the policy would be forfeited if the plaintiff made a fraudulent claim. The plaintiff having fraudulently concealed material facts from the defendant as mentioned above, has forfeited all rights under the policy. In paragraph 12 the defendant denies that the plaintiff has suffered loss to the extent mentioned and/or claimed in paragraph 4 of the plaint or at all. On these allegations the liability under the policy has been denied. It is submitted that the suit is not maintainable and should be dismissed with costs.

4. On these pleadings various issues have been raised by the defendant. A Brief of Documents containing copies of the documents disclosed by the parties has been tendered and marked as an exhibit, formal proof having been dispensed with. At the trial the plaintiff tendered his own evidence and the evidence of three other witnesses. The defendant also tendered the evidence of four witnesses.

5. The first document in the Brief of Documents is a copy of the First Information Report or a diary dated 12-3-1949 in the Sibpore Police Station. It records that the plaintiff gave information of a theft having been committed at premises 6, Ganesh Chatterjee Lane. The thief is alleged to have pulled and tore away the necklace from the wife of the plaintiff's 'Natun Bowma'. The list of stolen articles has been given. The diary is dated 12-3-1949. The plaintiff in his evidence stated that the burglary was committed in the ground floor where his brother and his wife were sleeping at the time. Alter the alarm was raised by the plaintiffs brother's wife, the brother ran after the thief and the plaintiff went to the thana which was very near to give intimation of burglary. In Court the plaintiff stated that he gave the information to the police immediately at 3 A. M. and went on the following morning when the First Information Report was signed and entry recorded. It was suggested that the plaintiff did not go at night but went to the thana on the following morning. The suggestion, was made on the basis of the language used in the police diary. It was further suggested that the goods stolen did not belong to the plaintiffs brother's wife but to the plaintiff's wife. I have no reason to disbelieve the plaintiff's story. The First Information Report or the police diary clearly indicates that the ornaments stolen were snatched away from the neck of the plaintiff's brother's wife and the female clothings stolen may very well have belonged to the wife of the plaintiff's brother. It is indicated that the padlock of the plaintiff's drawing room was broken but nothing was taken therefrom. There is nothing in the police diary to negative the plaintiff's evidence that nothing belonging to the plaintiff had been stolen. The mere fact that the plaintiff and not his brother lodged the First Information Report does not prove that the stolen goods belonged to the plaintiff's wife. The plaintiffs brother did not give evidence in the case and this fact has been commented upon by the learned standing counsel appearing for the defendant. The plaintiff was asked why his brother is not called to corroborate his story, the plaintiff answered that it was not necessary to call him.

6. The defendant is seeking to avoid the policy on the ground that there was a previous burglary as a result of which the plaintiff suffered loss and that this fact was suppressed from the defendant at the time when the contract was entered into. It is for the defence to prove first that such a burglary did take place and, second, that the plaintiffs goods were stolen. The plaintiff admitted the burglary but denied that his or his wife's goods were stolen. The police diary or First Information Report docs not disprove the plaintiff's case. If it was insufficient, it was for the defence to lead additional evidence to prove its own case. This elementary rule that the defence has to prove its own case, cannot be reversed even if the witness to prove the defence case is the plaintiffs brother. In the instant case, therefore, it was for the defence to tender the evidence of the plaintiff's brother or any other witness to prove that the ornaments stolen belonged to the plaintiff and/or his brother. The learned standing counsel, in my judgment, is not right in his submission that I should draw an adverse inference against the plaintiff for not calling his brother to corroborate the plaintiff's story. This would be misplacing the burden of proof. If any adverse inference is to be drawn, it must be against the defendant. It must be held that the defence has failed to substantiate the case made in the written statement on this point.

7. The second document is a copy of the proposal form. It is dated 26-6-1954. Reference has been made to a few questions and answers in the policy. They are: ;

Q. 1. State fully construction of external walls, floors and roofs of the building and of adjoining buildings, if any?

Ans. Two-storied pucca brick built building. External walls, floors and roofs are pucca brick built, adjoining buildings (No. 6/2)) is a pucca brick built building which is occupied by a senior C.I.D. Inspector of Police who is my tenant.

Q. 4(A) Are you the sole occupant of the premises?

Ans. No. 1st floor entirely in our (myself and my brother) possession.

(B) If not, how many families are co-tenants?

Ans. Five families live in the ground floor, one of them is a Police Officer.

Q. 7(A) Have you ever sustained a loss by fire, burglary, house-breaking or larceny?

Ans. No.

Q. 10. Section B. Burglary.

(1) On furniture, household goods and personal effects of every description excluding pedal cycles and perambulators belonging to the proposer and to such members of his family as permanently reside with him, except such articles as are specially mentioned below. No one article (furniture, pianos and organs excepted) shall be deemed to be of greater value than 5 per cent of the total sum insured unless specially named and the sum to be insured thereon specifically stated in (3) below ........Rs. 7,000/-

(2) On Trinkets, personal ornaments & gold sovereigns ... ... Rs. 23,000/-Rs. 30,000/.The proposal contains a promise on the part of the plaintiff to supply a list of ornaments later on. It is expressly stated in the concluding portion of the proposal that 'the above statements and particulars are correct and complete x x x x that the proposal and warranty shall be held to be promissory and be the basis of the contract between me and company'.

8. On 1-7-1954 the plaintiff sent a letter to the Manager of the defendant company with a list of the furniture, personal effects and a detailed list of gold ornaments and trinkets with valuation of each item. The plaintiffs evidence in Court is that this weighment and valuation of the ornaments and trinkets was effected by a goldsmith brought by the plaintiff's friend, one Moni Kundu. The plaintiff does not know the name of the goldsmith and Moni Kundu is now dead. By the letter dated 6-7-1954 the Company accepted the proposal and asked for the additional sum of Rs. 97/8/- over and above Rs. 225/- already paid on account of premium. In due course the policy was issued on 13-7-1954.

9. The burglary took place on 5-8-1954 and notice of the burglary was given on the following day. Subsequently there was correspondence between the parties. Plaintiff insisted on early settlement of the claim by various letters. The defendant gave various reasons tor not settling the claim. The reasons given are, non-receipt of the final report from the police, enquiry not having been completed and reasons of like nature. On September 23, the defendant wrote as follows:

'Claim under fire and Burglary Policy No. C/FB 9445.

Dear Sir,

We are in receipt of your letter of the 20th instant together with enclosure and would advise you that we have not yet received the final police report in this connection. Furthermore, we would inform you that our enquiries are not yet completed and we are not in a position to entertain your claim at this stage.

When our representative interviewed you on the 1st instant you were requested to forward us a certificate from the jeweller who weighed and valued your jewellery at the time of insurance and we shall be pleased if you will let us have this at the earliest convenience'.

The plaintiff replied to this letter on 27-9-1954 in the following terms;

'Re. Claim under Fire and Burglary Poliey No. C/FB 9445. Dear Sir,

I am in receipt of your letter dated 23-9-54 and am surprised to note the contents. I da definitely remember that your representative during his call on me on 1-9-54 did not ask for a certificate from the goldsmith who weighed and valued my gold ornaments at the time of insurance. All the informations and references asked by your representative had been promptly submitted to you per my registered letter D/- 2-9-54. Had your representative asked for the said certificate I would have surely mentioned the same in my letter D/- 2-9-54. On 1-7-54 I sent you a detailed list of my gold ornaments and trinkets with special references to the weight of each item and the total weight. You and your representative verified and accepted the same. After 21 days since my letter D/- 2-9-54 and specially after receiving the intimation of Police Final Report your request to send you the goldsmith's certificate appears to be concocted.

However, I am again mentioning here that my contractor friend Sri Moni Kundu of 24 Mussulmanpara Lane, Calcutta, at my request brought a goldsmith who weighed and valued my ornaments. It is now 52 days since my claim to you (my letter D/- 6-8-54). Though I do not definitely know how long time a first class European Insurance Company take to complete their enquiries still I feel that 52 days are normally sufficient for the purpose. Your representative who called on me on 1-9-54 assured my wife that claim will be settled immediately after the Police Final Report. Kindly let me know whether you have received the Police Final Report by this time. I may, for your convenience, forward to you the original intimation of the police final report. If you advise me so, please note, that the Sibpur Police Station intimated me about the Police Final Report on 19-9-54, and I do not find any reason why the Final Police Report has not been received by you.

Please arrange for the early settlement of the claim. Thanking you once again'.

10. Between September 1, and September 23, 1954 there are several letters and as desired by the defendant company by its letter dated August 30, 1954 the plaintiff sent a copy of the First Information Report on 2-9-1954 with a covering letter. In the covering letter the plaintiff refers to the call of the defendant's representative on the previous day and gives the answers to the questions put to him. The answers clearly indicate that the questions asked were about the rest of the ornaments insured which had not been burgled.

'1. The balance Ornaments viz., 2 Gotes 1 Crown, 1 Necklace (approximate total weight 86 tolas) have been handed over to my cousin brother Sri Brojendra Badan Goswami, 28 Banomali Sarkar Street, Kumartuli, Calcutta during the last week of July 1954 for making them into new sets of ornaments in connection with my daughter's marriage which is to take place during this current Bengali year'.

This letter was not replied to by the defendant and there was no challenge at any time that the answer was not to the point.

11. After a long gap of three weeks, the Company wrote a letter on 23-9-1954. In between the plaintiff wrote several letters pressing for a settlement of the claim and the Company wrote a letter on 14-9-1954 stating that the matter was receiving attention. The company in its letter dated September 23, states that its representative requested the plaintiff to forward a certificate from the jeweller who weighed and valued the jewellery at the time of insurance and it asked for the same to be forwarded at the plaintiff's earliest convenience. The plaintiff's denial of this fact in the letter of September 27, was immediate. The plaintiff stated 'that on 1-7-1954 a detailed list with weight and value was sent and your representative verified and accepted the same'. The letter reiterates that the plaintiff's friend Moni Kundu of 24. Mussulman para Lane brought the goldsmith who weighed and valued the ornaments. As stated before, this letter was not replied to.

12. This evidence in the correspondence leaves no doubt in my mind that the defendant's story as contained in the letter of September 23, is not true and the plaintiff's story made in the letter of the 27th is correct. Verification of the list of ornaments with weight and value sent on 1-7-1954 and its acceptance by the defendant's representative has been alleged in clear and unambiguous terms. The defendant never disputed it in the correspondence. No responsible officer of the company has given evidence to explain away the omission in the defendant's above letter. It is, therefore, useless for the learned standing counsel to argue that prior to the burglary there was no verification and acceptance of the list by the defendant company or its representative.

13. In answer to the next letter sent by the plaintiff on 15-10-1954, the defendant asked the plaintiff to refer to Mr. Umasankar Sarkar, M.A., B.L., the defendant's assessor to whom the papers had been sent and 'until we receive his report we are unable to discuss the matter'. Subsequently the plaintiff was required to forward to the defendant the police report which was sent on 30-10-1954. The plaintiff appears to have been fed up with the delay in the matter and by his letter dated 17-11-1954 the plaintiff gave notice that if the claim was not settled within seven days from the date of receipt of the letter steps would be taken without any further reference. Subsequently, the defendant made the case that Mr. Uma Sankar Sarkar went to the plaintiff's place on 16-11-1954 to see the room in which the alleged burglary took place. Plaintiff was requested to make an appointment with Mr. Sarkar so that he may inspect the entire premises. The plaintiff's reply to this letter is dated 24-11-1954 and reads as follows:

'Re. Claim under Fire and Burglary Policy No. C/FB 9445.

Dear Sir,

I have today received a registered letter written on a letter head of Shri Umasankar Sarkar M.A., B.L., bearing an illegible initial and advise that the said letter is full of concocted stories. I note that a copy of the said letter has been forwarded to you.

Please note that my rooms, where the burglary took place and also the site had already been thoroughly inspected by one of your responsible senior officer, presumbly Mr. Shelton on 1-9-54.

It appears that the said letter is another example of your flimsy pretexts forwarded to me from a different quarter'.

14. On 6-12-1954 the plaintiff caused to be served on the defendant a notice of suit by his solicitor B. M. Das. The letter was answered by the defendant's solicitor Messrs. P. C. Ghose and Co., on 16-12-1954 denying liability in the following terms:

'Your client has failed to prove the theft alleged to have been committed on 5-8-1954 as alleged in your letter under reference or that as a result of such theft jewellery, ornaments, sarees, utensils etc., worth about Rs. 17,000/- have been stolen as alleged in your letter under reference. Your' client has also failed to prove the fact of possession of such jewellery, ornaments, saris etc. Further it appears that the policy had been obtained by your client through false representation and suppression ot' material facts in the Proposal Form.

In the circumstances our clients deny their liability for your client's claim of Rs. 16,889-0-0 or for any sum whatsoever.

The intention of your client in the matter is obvious from the fact that when Mr. Uma Sankar Sarkar who was appointed by our clients as the Assessor went to your client's place of residence on 16th November last and waited there between the hours of 11-30 A. M. and 12 noon, he was not shown the place from where the alleged burglary had taken place. Thereafter Mr. Sarkar has also written to your client on 26-11-1954 desiring the inspection of the place from where the alleged burglary had taken place and requesting your client to arrange for appointing a date and time for the same but nothing has been done by your client to comply with such requests.

However without prejudice to our client's contention as hereinbefore stated please advise your client to appoint a date and time for allowing inspection of the place from where the alleged burglary had taken place to Mr. Sarkar. This is strictly without prejudice to our client's right'.

15. A perusal of the correspondence leaves no doubt that the defendant took recourse to dilatory tactics and three or four reasons were given for not settling the claim in the letter of the defendants dated December 6, as set out above. They are:

(1) the plaintiff failed to prove theft of jewellery and ornaments;

(2) the plaintiff failed to prove the fact of possession of the ornaments, jewellery, sarees etc. and

(3) the policy was obtained by false representation and suppression of material facts in the proposal form.

In view of this attitude, it is difficult to appreciate the request made in the concluding portion of the letter to give inspection to Umasankar of the room where the burglary took place. It is important to note that at the hearing the defence made out the case that there was inspection already effected by three of the company's representatives. The case put by the learned standing counsel is that one of them is Umasankar Sarkar, another being Mr, Shelton an officer of the company, and the third being A.N. Sen who tendered evidence. If Umasankar had already inspected the premises, I do not understand why the defendant should make a grievance that Umasankar was not allowed inspection. It is difficult to understand the motive of the company in obtaining another inspection by Umasankar. Though there has been a good deal of cross-examination on the point, the defendant did not tender the evidence of Umasankar Sarkar.

16. By this time, the final police report was already in possession of the defendant. The plaintiff was never asked to give evidence of possession of the ornaments. The only request made by the defendant to the plaintiff was to give a certificate of valuation by a valuer. After the plaintiff had stated in reply that a full list had already been furnished before the policy was issued and verified by the defendant's representative, no further complaint was made on that score. The last ground which seems to be the real ground of contesting the claim is misrepresentation and suppression of material facts in obtaining the policy. There is no indication in the letter as to what misrepresentation of fact was made by the plaintiff and what fact the plaintiff suppressed in persuading the defendant to issue the policy. There was not the slightest indication in the letter that there was a previous burglary in the house and the plaintiff and/or his wife was a victim to it.

(After discussing the evidence his Lordship held:

(1) that a burglary was committed on the plaintiffs premises on 5-8-1954;

(2) that at the time of insurance the plaintiff had the ornaments and that on the pleadings the defendant was not entitled to make a case that there was no ornament to insure;

(3) that the suggestion made at the trial that the plaintiff procured the policy fraudulently without having the ornaments at all, staged a burglary which never happened, so that with the insurance money he could meet the marriage expenses of his daughter was a highly improper suggestion and ought never to have been made, as no case had been made in the pleadings and without any evidence at all;

(4) that the proposal on the basis of which the policy was issued was signed at the plaintiffs residence and not at the office of another rival insurance company and concluded:)

17. On my finding, it must be held that the plaintiff is not guilty of giving false answer to anyone of the questions in the proposal that the plaintiff was required to answer. In particular, he did not give false answer to Q. 7(a). I find that the plaintiff never suffered any loss by fire, burglary, house-breaking or larceny,

18. The next point to be considered is whether the plaintiff was under an obligation to disclose the burglary of 1949 and failure to disclose the burglary amounts to suppression of a material fact, so as to avoid the policy. A contract of insurance is contract uberrima fides and there must be utmost good faith on the part of the assured. This imposes a duty and an obligation on the assured to make a full disclosure of all material facts which would affect the mind of the insurer whether to accept the risk or not and on what terms. The duty is to disclose material facts only. A fact which is the subject-matter of a question in the proposal which the assured is required to answer must be considered to be a material fact, so that a false answer will vitiate the policy in terms of the contract itself. But a fact may be a material fact, even though it is not the subject-matter of a question in the proposal, if the knowledge of that fact will affect the mind of an ordinary insurer to accept the risk. If it is so, it as a material fact and non-disclosure or concealment of such a material fact will avoid the policy, even though there is no fraud and the concealment is innocent. The law is clear that a defence of concealment is availably to the insurer and, if established, will avoid the policy. In order to establish its defence of concealment, the insurer must prove:

(1) that the facts alleged to have been concealed by the assured were true;

(2) that they were material facts, and

(3) that they were within the special knowledge of the assured.

Burden of proving these three facts is on the defendant who sets up this defence. In the instant case, it has been proved indeed admitted by the plaintiff himself, that in 1949 a burglary was committed in the ground floor of the same premises. It has been further proved that the plaintiff had knowledge of this burglary having been committed in 1949 when he submitted his proposal for insurance in June 1954. The only question to be considered is whether this fact was a material fact which it was the plaintiff's duty to disclose.

19. Every fact is a material fact which would, if known, reasonably affect the minds of the prudent and experienced insurers in deciding whether they will accept the contract or in fixing the amount of premium to be charged or on what condition, in case they accept it. (See Dawsans Ltd. v. Bonnin, (1922) 2 AC 413, observation of Lord Finlay at page 433). Attempt has been made by the defence to lead positive evidence by witnesses supposed to be experts in insurance business that the fact of a burglary having been committed in the premises or locality affects the mind of the insurer. The witnesses are the two employees of the defendant company, namely, Anathnath Sen and Sambhudas Banerjee as also Samirendra Nath Bose. I have already recorded my opinion that they hold insignificant position in the company and had no power to accept or reject a proposal of insurance. So also Anathnath Bose has very little experience of general business, if at all. He also had no power to accept or reject a proposal. None of these witnesses can be accepted as a witness able to depose that a burglary policy cannot be accepted if once a burglary is committed in the same or nearby premises. I have no doubt that these witnesses have been tutored to say what they said in order to provide an argument to the defence counsel.

20. Whether a particular fact is material depends upon the circumstances of a particular case. Evidence of materiality is not always necessary. Materiality of a particular fact may be obvious from its very nature. The test to determine materiality is whether the fact has any bearing on the risk undertaken by the insurer. If the fact has any bearing on the risk, it is a material fact; if not it is immaterial. The short question I am called upon to answer in the instant case therefore is whether the fact of burglary having been committed five years back in the ground floor of the same premises has any bearing on the risk undertaken by the insurer by insuring goods in the first floor of the same premises in 1954. Learned standing counsel contended that it has a bearing on the risk because it indicates that the premises is vulnerable, that the area is bad area in which burglary takes place and that the occupiers of the premises are not careful persons. I am not impressed with this argument. I do not know any house that is proof against burglary and it is absurd to say that a particular premises is more vulnerable than others merely because a burglary has been committed in that place. Again it does not follow that because the ground floor is vulnerable, each one of the upper stories are equally vulnerable. I am equally unable to agree with the learned standing counsel that a locality becomes a bad locality if one of the houses is burgled in that locality. It is also absurd to contend that the occupier of the first floor is to be stigmatised as a careless person when a burglary is committed in the ground floor of the building with which the occupier of the first floor has no concern. The reasons given by the learned standing counsel appear to be far fetched and fantastic. I fail to understand how the fact of burglary having been committed in the ground floor of the premises some five years back, has any bearing on the risk of insurance of goods in the first floor of the same premises five years after. Nor, do I consider that this fact has any bearing on what is called 'the moral hazard' in insurance. All cases of moral hazard have reference to the person and not the place in which burglary takes place. Not a single case has been cited in which it has been held that a previous burglary in a part of the premises has a bearing on the risk undertaken by the insurer in effecting a burglary insurance of goods situate in other part of the same building. What facts must be disclosed as material facts have been indicated in the Law of Fire Insurance by A. W. Baker Weltord and W. W. Otter-Barry, 4th Edition at page 137 which reads as follows:

'The facts which must be disclosed as material may be classified as follows:

(i) Facts which show that in the case of the particular subject-matter of insurance the risk of fire is greater than would ordinarily be expected considering its nature. It is necessary for the assured to disclose every thing in the nature, condition, or user, of the subject-matter or its surroundings, which points to a more than ordinary risk.

In particular, the following facts have been held to be material: that a fire had broken out in an adjacent building, although it had been extinguished a few hours before the assured sent the instructions to his agent to effect the insurance; that threats have been made to destroy the property, or that the assured has reason to suspect that an attempt to do so will be made.

(ii) Facts which bear upon what is called the moral hazard and suggest that in the case of the particular assured the possibility of fire may be greater than usual. Thus, it has been held to be material that the assured has had previous fire losses, or has made previous claims, or that other insurers have previouly refused to renew fire policies effected by the assured, or to accept proposals for fire or other insurance from him. In accordance with the same principle the assured must disclose the fact of an excessive overvaluation, or in the case of an insurance on profits, the fact that he is trading at a loss. In certain circumstances, the nationality of the assured may be material, or even his name.

(iii) Facts which show that, in the circumstances, the liability of the insurers may be greater than would naturally be expected under an insurance of the property in question. Thus, it is material, in a retrospective insurance, that the subject-matter is already destroyed; or, under a special insurance, binding the insurers to reinstate the machinery insured, that the machinery is second-hand, seeing that that the cost of reinstatement will be proportionately greater. In the case of goods entrusted to a carrier, it may be a material fact that the assured has entered into a special contract, by which the carrier is relieved from his common law liability.

(iv) Facts which are shown to be material by being made the subject of a question', I do not consider that the instant case comes under any one of the above four headings.

21. The case strongly relied on by the learned standing counsel is the case of Bare v. Turner, 6 Tart 338. In this case a fire broke out in an adjacent building and after a few hours when the fire is supposed to have been extinguished, the proposal for insurance was made without disclosing the adjacent fire which was extinguished a few hours back. Alter the proposal was accepted a fire broke out in the premises of the assured covered by the policy. The fire was caused by the fire in the adjacent building which fire was supposed to have been extinguished but in point of fact has not been extinguished. On these facts the Court held that the fire in the adjacent building a few hours before the proposal should have been disclosed as a material fact. The facts in the cited case is clearly different from the facts in the instant case. Surely the fact of fire having taken place in the adjacent building a few hours before the proposal for insurance cannot be equated to a burglary in the adjacent premises having taken place years back. Nor can we ignore that whereas the cited case is a case of fire insurance, the instant case is a burglary insurance. In my judgment the case cited is of no assistance to the learned standing counsel.

22. The questions assured is required to answer give some indications as to what facts are considered to be material affecting the risk to be undertaken by the insurers. The subject matter of question No. 1 is the premises in which properties assured are to remain. The assured is required to state the construction of external walls, floors and roofs of the building and of adjoining building, if any. Q. 2, 3 and 4 deal with the character of the premises whether residential premises or profession or trade carried on in the building, whether the assured is in sole occupation or shares the premises with others and the number of co-tenants, if any. Question 5 enquires whether the premises at any time would be unoccupied, -- if so, for how long. Question 6 deals with the properties to be insured. Questions 9 and 10 relate to the value of the properties to be insured. Question 7 as also Q. 8 are purely personal questions relating to the assured or known as 'moral hazard'. These questions are entirely personal to the assured and have no reference to the place where the insured property would lie. It is to be noted that in both the questions the emphasis is on the word 'you'. Have you sustained a loss etc.? Have you had a proposal terminated by a company? A perusal of these questions which an assured is required to answer lends to suggest that the happening of a burglary in the neighbouring premises or another portion of the same premises is not considered to have anything to do with the risk to be undertaken by the insurer and as such is not at all material for the purpose of insurance. I am far from suggesting that in order to validate a policy all that is necessary is to give correct answers to the questions fully and frankly. There may be other facts not covered by the queries in the policy which affects the risk and which, it is the duty of the assured to disclose. But the nature of questions, an assured is required to answer undoubtedly gives an indication as to what facts in the opinion of the insurers are material affecting the insurance risk. If the insurers rely on other facts as having a bearing on the risk under the policy, such other facts must be strictly proved to have such a bearing by dependable evidence or otherwise to the satisfaction of the Court. In the instant case, I am not satisfied that the previous burglary of 1949 has any bearing on the risk to be undertaken on the policy in suit and the contentions made on behalf of the defence have no substance whatsoever.

23. On the evidence I must hold that the plaintiff has proved his case. I accept the plaintiff's evidence as to the value of the property and quantum of loss suffered.

24. There will be a decree for Rs. 16,889/-.The plaintiff will be entitled to both interim interestand interest on the decretal amount at the rate of6 per cent per annum. The plaintiff is further entitled to the costs of the suit. Certified for twocounsel.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //