NEW INDIA ASSURANCE CO LTD Vs. RADHAKRISHNAN

JUDGEMENT

(1.) Fishing boat 'Chitralekha' belonging to the plaintiff was insured with the appellant first defendant under a marine insurance policy valid from 12-1-1978 to 11-1-1979. The policy included a special condition by way of warranty (monsoon cover) prohibiting fishing operations during monsoon season from 1-6-1978 to 15-8-1978 outside the limits of Neendakara Port. While engaged in fishing operations by about 6.00 a.m. on 9-3-1978, due to engine failure and weather conditions, the boat was washed off and lost in the sea. The crew was saved by fishermen. These are admitted facts.

(2.) In the suit claiming over Rs. 93,000/- under the policy, the main defence (the only one which was pressed into service before me other than regarding quantum) was violation of the special condition which exonerated and discharged the insurer. On the evidence, Trial Court found that the boat did not go beyond the Port limits and hence it did not violate the special condition. The suit was decreed. The only question that has to be considered is whether the claim is liable to fail due to violation of the condition. Correctness of the amount decreed may come up only if this question is found in favour of the plaintiff.

(3.) There is no dispute on the question that if the special condition is violated, the insurer is automatically discharged from liability. A warranty in a marine insurance policy involving risk is a special condition which may be either express or implied. It must be exactly complied with, whether it be material to the risk or not. If it is not complied with, then, subject to any express provision in the policy, the insurer is discharged from liability as from the date of the breach of warranty, but without prejudice to any liability incurred before that date. Warranty is different from a representation in the sense that the former requires a strict and literal fulfilment, but the latter may be satisfied with substantial and equitable compliance. The contract does not exist unless the warranty is literally complied with. It is a promissory warranty by which the assured undertakes that some particular thing shall or shall not be done or that some condition shall be fulfilled or affirms or negatives the existence of a particular state of facts. Warranty, as signifying a condition precedent, is inveterate in marine insurance unlike in some other branches of law, for example, in relation to the law of sale of goods, where it signifies only a collateral stipulation, the breach of which gives rise to merely a claim for damages and not a right to avoid the contract. The position, so far as a marine insurance policy is concerned, is otherwise as S.35 of the Marine Insurance Act specifically indicates. I am fortified in this context by various authorities on the subject quoted before me.