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Smt. Brindarani Debi Vs. Co-operative Assurance Co. Ltd. - Court Judgment

LegalCrystal Citation
SubjectInsurance
CourtKolkata
Decided On
Reported inAIR1944Cal1
AppellantSmt. Brindarani Debi
RespondentCo-operative Assurance Co. Ltd.
Cases ReferredT. G. Rajan v. Asiatic Government Security Life Assurance Co.
Excerpt:
- .....we are concerned was 6th january. it was not paid on that date and the assured was entitled to 15 days grace. the premium was paid on 21st january. the company claims that the days of grace should be calculated by including in the calculation 6th january. if that is done the premium was one day late. on the other hand it is argued on behalf of the assured that in calculating days of grace the due date should be excluded. that has been held in a number of cases which are summed up in the decision of the madras high court reported in t. g. rajan v. asiatic government security life assurance co., ltd. ('39) 26 a.i.r. 1939 mad. 159. there it is pointed out in conformity with the decisions in a number of english cases that in calculating the days of grace the due date should be excluded. the.....
Judgment:

1. The plaintiff claims the amount due on a policy of insurance on the life of her deceased husband Sudhir Chunder Mullick. Mr. Mulliek died intestate on 10th February 1941. The defendant, the Co-operative Assurance Co. Ltd., denies liability on the ground that the policy lapsed on 20th January 1941, for non-payment of premium. They say that it was revived by the insurance company on 5th February 1941 on the faith of a declaration by the assured that he was free from any disease. On the death of the assured it appeared that he was suffering from tuberculosis and the doctor who signed the certificate has repor. ted that he had been suffering from this disease for the previous six months. The medical report is not disputed, and the plaintiff does not rely on the declaration made by or on behalf of her deceased husband. She contends however that the policy did not lapse on the ground that payment of the premium was within the days of grace allowed by the policy. The defendant company carries on business in Lahore, and it is stated in the cause-title that it carries on business and has its office at 11, Esplanade East, Calcutta, within the jurisdiction of this Court. The cause-title has been verified as part of the plaint and as true to the knowledge of the plaintiff. No objection was taken in the written statement save on the general plan that this Court had no jurisdiction to deal with the claim. The following issues were framed:

(1) Has this Court jurisdiction to try this suit (2) Was the policy in force on 10th February 1941 when the assured died? (3) Is the plaintiff the widow and legal heir of the assured (4) To what relief, if any, is the plaintiff entitled? The issue whether the plaintiff was the widow and legal heir of the deceased was raised by the defendant, but on the evidence before me there seems to be no doubt that she is entitled to sue. No argument has been addressed on this point by the learned counsel for the defendant company. On the question of jurisdiction, it is argued that the defendant company has no Calcutta office, that the amount due on the policy was not payable in Calcutta but at Lahore where the company has its head office, and further, that the assured died outside the jurisdiction. On the other hand, there is a considerable volume of evidence that the business of the company has been transacted in Calcutta by a firm named B. D. Guha & Co., who are admittedly the Chief Agents of the company for Bengal, Bihar and Orissa. Their note-paper is headed with a green band right across the part abput half a... inch wide on which is printed 'The Co-operative Assurance Co. Ltd., Lahore.' The address is also printed 'll Esplanade East, Calcutta,' and on the left hand side the words 'B. D. Guha & Co., Chief Agents Bengal, Bihar and Orissa' are also printed. Correspondence to the company is addressed to the secretary, 'head office ' without stating the name of the company.

2. There is in evidence an advertisement in the Amrita Bazar Patrika which contains a picture some 4' x 3' square having in large letters the name of the defendant company. On the top right hand corner are the words 'Head Office, Lahore. Calcutta Office, 11 Esplanade.' There is no indication anywhere that 11 Esplanade is the office of B. D. Guha & Co., and the clear indication is that the Calcutta Office of the Co-operative Assurance Co. Ltd., is at 11, Esplanade, Calcutta. It is in evidence that this advertisement was put in by the Agents 'B. D. Guha & Co., who how-over deny that the company has a Calcutta office and say that the statement is false. The company however approve of the advertisement on the ground that it helps business. There is further evidence that considerable literature setting out the objects of the company and the benefits to be derived from insuring with the company were sent out to enquirers from Calcutta, that literature purports to be the company's Calcutta office. On the prospectus and table of rates of the defendant company there is stamped with a rubber stamp 'Calcutta Office, ll Esplanade East.

3. The secretary of the defendant company when his attention was called to these statements regarding the defendant company's Calcutta office said that he was unable to say whether the statement was false or not because in one sense B. D. Guha & Co., were working as agents of the Co-operative Assurance Co., Ltd., and they used the name just to facilitate business. They put, he said, 'The Co-opera-tive Assurance Co., Ltd.' instead of 'B. D. Guha & Co.,' because all these things can be had from their office. It is again noteworthy that the affidavit of documents of the defendant company has been sworn by a partner of B. D. Guha & Co. The same gentleman who is a partner in B. D. Guha & Co., verified the application for leave to file the written statement, he also swore affidavits in the proceedings, the reason being, according to the secretary of the company, that it would save him considerable inconvenience. Whatever the reason may have been it is clear that the firm of B. D. Guha & Co., are not merely a post office or conduit pipe through which communications may be sent to the defendant company but that they do a considerable amount of business on behalf of the defendant company in which they are allowed a certain amount of discretion. Mr. Bose has also said that they had sub-agents acting for the company under them and that B. D. Guha & Co., does work for the defendant company alone. I have been referred to the case reported in Law Compagnie Generate Transatlantique v. Thomas Law & Co. (1899) 1899 A.C. 431 where the Earl of Halsbury L. C. quoted with approval the words of Bacon V. C.:

They hire an office, write up their name, and beyond all question stamp upon themselves and upon their place of business here the assumption that here they carry on their business.

And it was held that in those circumstances the appellants in the house of Lords were resident within the jurisdiction. This question was considered by the High Court of Madras in a case reported in G.D. John v. Sambamurty Aiyar : AIR1929Mad347 where the learned Judges held that a life assurance company which had its head office at Bombay and agents at Madras who had no discretion but acted merely as a post office forwarding proposals and sending monies to the head office could not be said to carry on business within the meaning of Rule 1 of Order 20 of the Original Side Rules. It is noteworthy that in this suit leave to sue has been obtained under Clause 12 of ihe Letters-Patent, and it appears to me that there is jurisdiction in this Court in that part of the cause of action arose in Calcutta inasmuch as the proposal was made in Calcutta and forwarded from Calcutta to Lahore. In view of the evidencd. to which I have referred I should also be inclined to hold that the defendant company did in fact carry on business in Calcutta by means of B. D. Guha & Co. The question then arises whether the policy lapsed. This question turns almost entirely on the method of computation of the days of grace. The policy provides that all premiums are payable in advance at the head office at Lahore on or before the due date. It is then provided that premiums are payable yearly but to suit the convenience of the assured half-yearly, quarterly and monthly premiums will be accepted. The monthly premium is one twelfth of the annual premium increased by 6 1/4 per cent.

4. In this case the assured paid his premium monthly and as learned counsel has put it 'he bought the right to do so owing to the increase in the amount of the premium.' The policy further provides 'a grace of 30 days without interest charge shall be granted for payment of yearly and half-yearly premiums and 15 days for quarterly and monthly premiums.' The due date for payment of the premium with which we are concerned was 6th January. It was not paid on that date and the assured was entitled to 15 days grace. The premium was paid on 21st January. The company claims that the days of grace should be calculated by including in the calculation 6th January. If that is done the premium was one day late. On the other hand it is argued on behalf of the assured that in calculating days of grace the due date should be excluded. That has been held in a number of cases which are summed up in the decision of the Madras High Court reported in T. G. Rajan v. Asiatic Government Security Life Assurance Co., Ltd. ('39) 26 A.I.R. 1939 Mad. 159. There it is pointed out in conformity with the decisions in a number of English cases that in calculating the days of grace the due date should be excluded. The meaning of 'days of grace' is explained, namely, that in the event of payment not being made by the due date certain extra days should be allowed by way of grace or favour. The due date cannot possibly be called the date on which grace or favour was shown to the assured. The first day on which such grace could be shown would be the day subsequent to the due date. If the terms of the policy are construed in this way, there was no lapse, and no necessity for revival and as I have pointed out that is the norma] method on which days of grace should have been calculated.

5. The defendant company however rely on a notice dated 8th February which is subsequent to the date of the alleged lapse, and contains a printed notice of the manner ir which days of grace are calculated when the half yearly instalment of premium falls due It is suggested that the assured should appreciate from this notice that the days of gract with regard to every type of instalment of premium would be calculated in the same manner, namely, by including within the days of grace the due date. The only evidence thai notices of this nature were sent to the assured was in answer to the following question:

Look at this document, did you send a notice like this every month to the assured ?-Yes.

6. It is most unfortunate that on an importani point like this a very leading question should have been put to the witness, for it makes his answer valueless. There has been no attempt to prove apart from this evidence that notices of this nature were sent to the assured. Even had they been sent, I am very doubtful whether a company would, be entitled to rely upon them It is an axiom of interpretation when dealing with insurance companies that if there is any ambiguity in the document it is to be construed against the company. In the policy there is no explanation of the method in which days of grace should be calculated and it would be natural to presume that they would be approved by the Courts. Even supposing this notice had been sent the assured might well be under the impression that the stated method of calculating days of grace is confined to half yearly instalments as in the example set out in the notice. If all instalments were to be cal-culated in the same manner nothing could be easier than for the company to say so. I hold that the Court has got jurisdiction that the policy was in force on 10th February 1941, and the plaintiff is entitled to a decree for Rs. 200C with profits and interest from 10th February 1941 to the date of the death of the assured Costs on Scale No. 2 including the costs of the de bene esse examination. I certify for two counsel.


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