M/S. GALADA POWER AND TELECOMMUNICATION LTD. versus UNITED INDIA INSURANCE CO. LTD. AND ANOTHER ETC.

M/S. GALADA POWER AND TELECOMMUNICATION LTD. versus UNITED INDIA INSURANCE CO. LTD. AND ANOTHER ETC.

The insurer, by appointing a surveyor and failing to mention delay or the duration clause in its repudiation letter, waived the right to repudiate the claim based on the duration clause. The insurer had taken positive action inconsistent with its rights under the clause, and the surveyor's report established the loss. Thus, the claim was tenable and the insurer liable to pay the loss assessed.

Parties
Appellant/complainant: M/s. Galada Power and Telecommunication Ltd.; Respondent No.1 (insurer): United India Insurance Co. Ltd.; Respondent No.2 (carrier): India Transport Organization
Jurisdiction
India
Judgment Date
28 July 2016
Procedural Posture
Civil Appeal / Supreme Court Decision on Appeal From National Consumer Disputes Redressal Commission
Outcome
Appeals allowed; decision of National Commission set aside; State Commission decision restored.
Legal Topics
Waiver, Duration Clause in Insurance, Transit Loss, Consumer Disputes
Insurance Law Consumer Protection Waiver Duration Clause in Insurance Transit Loss Consumer Disputes

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Parties

M/s. Galada Power and Telecommunication Ltd.

Appellant/complainant

United India Insurance Co. Ltd.

Respondent No.1 (insurer)

India Transport Organization

Respondent No.2 (carrier)

Procedural Posture

Civil Appeal / Supreme Court Decision on Appeal From National Consumer Disputes Redressal Commission

Legal Issues

  1. 1 Whether the insurer waived its right to repudiate the claim based on the duration clause by its conduct and by appointing a surveyor
  2. 2 Whether the repudiation of the claim on grounds other than delay is valid when the repudiation letter does not mention the delay
  3. 3 Whether the State Commission correctly allowed compensation relying on the surveyor's report

Ratio Decidendi

The insurer, by appointing a surveyor and failing to mention delay or the duration clause in its repudiation letter, waived the right to repudiate the claim based on the duration clause. The insurer had taken positive action inconsistent with its rights under the clause, and the surveyor's report established the loss. Thus, the claim was tenable and the insurer liable to pay the loss assessed.

Court Disposition

Appeals allowed; decision of National Commission set aside; State Commission decision restored.

Orders

  • Balance amount along with interest as directed by the State Commission to be paid by the insurance company within four months.