Insurance Special Condition “Voyage should commence & complete before monsoon sets in”
There was insurance contract between the appellant and the respondent for the voyage and the vessel for the period of 16th May to 15th June, 2013 (for one month) from Mumbai to Kolkatta.
The policy contained special condition that the “Voyage should commence & complete before monsoon sets in”
Secondly, Special Warranties inter alia provided that the Vessel to depart in local weather condition not exceeding Beaufort Scale No.4….”
On 6.6.2013 the vessel undertook the voyage and on the next date, it was anchored off near Ratnagiri Port due to bad weather and engine failure. The vessel ran aground.
The appellant sought assistance from the Insurer for towing and salvaging the Vessel after the insurance had expired. On 25.7.2013, the appellant issued the Notice of Abandonment to the Respondent claiming total loss on the ground that repair of the Vessel would be more expensive than the insured amount.
On 12.9.2013, the Insurer issued the repudiation notice and rejected the claim on the ground that the vessel set sail after monsoon set. The Surveyor issued a final report that the appellant was in wilful breach of the condition.
The National Consumer Commission rejected the consumer complaint for suppression of material facts.
The question was whether the special condition stands breached justifying the de facto repudiation of the Appellant’s claim by the Respondent.
HELD that if the condition is to be interpreted strictly, then the assured would be unable to make a claim in case of a marine accident where the vessel is unable to complete its voyage due to a peril, rendering the special condition impossible to comply with. Ultimately, the assured would be without any remedy under the insurance. This amounts to absurdity, vitiating the very purpose behind an insurance condition. As a result, we hold that the special condition cannot be treated as a condition precedent to waive any liability under the policy. It has been impliedly waived by the parties due to its non-material nature. It is probably a term used in all contracts by the Respondent as a part of its standard form and it failed to exclude the same from the policy availed of by the Appellant.
The contention of the Insurer that it had no knowledge of the voyage and believed that the vessel would be laid up at the Kolkata harbour during the foul season is unacceptable and is to be rejected. The Appellant had mentioned in the form that the purpose of insurance is to undertake the voyage from Ghodbunder Jetty in Mumbai to Kolkata horbour. The only logical conclusion of the information provided is that the insurance was availed to cover the foul weather period along the west and east coast. There is absolutely no permutation and combination in which the Appellant could have fulfilled this condition under the policy.
Judgment dated 7.4.2025 of the Supreme Court of India in Civil Appeal No.2323 of 2021 of Sohom Shipping Pvt Ltd Vs. M/s. The New India Assurance Co.Ltd and another
