As per case facts, safety matches were dispatched and insured. The goods were destroyed in a road accident involving the appellant's lorry and another vehicle. The insurance company (plaintiff) settled ...
No Acts & Articles mentioned in this case
2026:MHC:1818S.A.No.1687 of 2003
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Date of reserved : 13/03/2026
Date of Pronounced : 01/06/2026
CORAM
THE HON'BLE MS.JUSTICE R.POORNIMA
S.A.No.1687 of 2003
and
C.M.P.No.15413 of 2003
K.Srinivasan : Appellant/2
nd
Respondent/
2
nd
Defendant
Vs.
1.The Oriental Insurance Company Limited,
Divisional Office,
6-A, North Cotton Road,
Tuticorin-628 001.
Rep. By its Divisional Manager.
: 1
st
Respondent/Appellant/Plaintiff
2.M/s.L.P.L. Lorry Agencies,
No.5,Main Road, Sattur
through its Branch Office,
947, ANAG Building,
Main Road, Kovilpatti.
3.M/s/Jayaprakash Match Works
through its Partner,
M.Chandrasekar,
Kovilpatti.
4.L.P.Lakshmanan (Died) : Respondents 2 to 4/
Respondents 1, 3 and 4
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S.A.No.1687 of 2003
5.L.Karuthapandiyan
6.L.Arumugam
7.L.Ravichandran
8.L.Vigneswaran : Respondents 5 to 8
(R5 to R8 are brought on record
as Lrs of the deceased 4
th
respondent,
vide Court order, dated 06/04/2017
made in CMP(MD)No.12103 to
12105 of 2016 in SA No.1687 of 2003)
PRAYER : Second Appeal filed under Section 100 C.P.C., against the
judgment and decree, dated 12/12/2001 made in AS No.103 of 2000 on
the file of the Principal District Judge, Tuticorin, reversing the
judgement and decree dated 28/04/2000 made in OS No.11/1998 on the
file of the Sub Court, Kovilpatti.
For Appellant: Mr.M.P.Senthil
For 1
st
Respondent : Mr.C.Jawahar Ravindran
For R2 and R3 : No appearance
For 4
th
Respondent : Died (Steps Taken)
For R5, R6 and R8 : Mr.Michael Bharathi
For 7
th
Respondent : Dispensed with
(vide Court order, dated 31/01/2024)
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S.A.No.1687 of 2003
JUDGMENT
This second appeal is filed against the judgment and decree,
dated 12/12/2001 made in AS No.103 of 2000 on the file of the Principal
District Judge, Tuticorin, reversing the judgement and decree dated
28/04/2000 made in OS No.11/1998 on the file of the Sub Court,
Kovilpatti.
2.The appellant is the second defendant in the suit.
3. The case of the plaintiff in brief is that, on 07/03/1985,
750 bundles of safety matches value of Rs.78813-75/- were despatched
by the third defendant to Jodhpur vide Invoice No. B-127, dated
07/03/1985 to M/s.Minesh and Co., Jodhpur (Rajasthan). The goods
were despatched in a lorry bearing registration No.TDL-6465 belonging
to the 2nd defendant/appellant, vide consignment Note No.2251, dated
07/03/1985. Insurance was effected by the third defendant with the
plaintiff/Insurance Company, vide Policy No.41322/6/153/M/162/OPL,
dated 31/03/1984.
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S.A.No.1687 of 2003
4. On 12/03/1985, the lorry of the 2nd defendant was met
with an accident near Polapur on Bombay-Konkan-Goa Highways in
Raigad District (Maharashtra) colliding with the another vehicle bearing
registration No.MWT-9293. Due to the collision, the Lorry No.TDL
6465 with match bundles engulfed by fire resulting in total loss of the
goods, for which, FIR was registered by the Poladpur police. The first
defendant who had carried the safety transportation of the goods on
behalf himself and on behalf of the 2
nd
defendant issued a letter to the
third defendant's Insurance Company informing about the damages to the
consignment. Surveyor was appointed and the Surveyor also visited the
place and submitted a Survey report on 19/03/1985 along with the
photographs about the accident. On 27/03/1985, the third defendant
issued a registered letter with the Acknowledgement Card to the
defendants 1 and 2, on 28/03/1985 and 30/03/1985 making out a claim
for damages.
5. Since the defendants 1 and 2 did not choose to honour the
claim amount, on 17/04/1985 the third defendant submitted his claim bill
for Rs.79,914-75/- with the plaintiff Insurance Company. The plaintiff
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S.A.No.1687 of 2003
honoured the claim and settled the claim of Rs.79,914-75/- after
obtaining letter of Authority dated 13/06/1985 and letter of subrogation
on the same day. The plaintiff, on 07/10/1985 authorised M/s.Bhaichand
Amoluk Co., Insurance Consultants and brokers to recover the amount of
Rs.79,914-75/- from the carriers who in turn wrote a letter, dated
28/10/1985 to the defendants 1 and 2 calling upon them to pay the
amount. On 23/11/1985, the second defendant replied through their
counsel denying the claim. Even subsequent letter, dated 04/12/1985
issued by the plaintiff they did not invoke any response or paid cash.
Hence, the plaintiff filed the present suit for recovery of money.
6.The first defendant disputed the liability. It is the
contention of the first defendant is that there is no privity of contract
between them with the third defendant. The rule of subrogation is
applicable only between the plaintiff and the third defendant. The
consignee M/ s Minesh and co., has purchased the entire goods. The
third defendant has no insurable interest in the goods. If there is a loss, it
is the consignee M/s.Minesh and Co., who has to suffer. The suit is bad
for non-rejoinder of necessary party. The third defendant cannot
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S.A.No.1687 of 2003
authorise the present plaintiff, who is not a Power of Attorney
M/s.Minesh and Co., The third defendant after receipt of the entire sale
consideration in respect of 750 bundles of safety matches passed to the
title to M/s.Minesh and Co. If there is a loss, it is for the consignee
M/s.Minesh and Co., who has to suffer and has to claim for the loss.
7. They further contended that this defendant is not a lorry
movement or Coordinator, but is only a transport broker. He has no
control over any vehicle. He only accommodates lorry for transportation
of the goods. The job of this defendant will be over on bringing the
consignor and the lorry driver to contract. He was paid only for a meager
commission. No contract of carriage was entered between this defendant
and the third defendant. No goods were entrusted to him. He only
arranged the second defendant/appellant to negotiate the freight. The
second defendant/appellant is also a Transport Broker. This defendant
issued a lorry receipt on behalf of the second defendant. The contract of
carriage was entered into between the third defendant and the driver of
the 2
nd
defendant directly. This defendant did not aware about the
accident. If the accident is arising due to the negligence of the driver of
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S.A.No.1687 of 2003
the second defendant, this defendant cannot be held responsible for the
same. The letter of subrogation stated in the plaint even if it is true, it is
not held valid in law. This defendant is not liable to pay any cost to the
plaintiff and the suit is liable to be dismissed.
8.The second defendant/appellant disputed the claim of the
plaintiff. The second defendant states that as Carrier he had taken all
precautions and care in respect of the goods during transit. But the
accident was occurred unexpectedly due to reasons beyond the control
of the carrier and the driver who drove the vehicle. The certificate was
given without prejudice and was given at the request of the party to
record their protect and mark open delivery. The certificate and the loss
alleged in the plaint cannot in any way confer any benefit on the part of
the plaintiff by way of proof regarding the alleged damage. There has
been no reason for claiming any damages by the third defendant.
9. The trial Court, after receipt of the written statement
framed the following issues:-
1.Whether the third defendant has got title over the
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S.A.No.1687 of 2003
goods at the time of the accident?
2.Whether the 1st defendant acted as a lorry arranger?
3.To what relief, the plaintiff is entitled to?
10.The following additional issues were framed by the trial
Court on 27-04-2000:-
1.Whether the suit as framed is maintainable in law?
2.Whether the claim amount paid by the plaintiff on the
basis of the insurance policy to the third defendant is proved
by the plaintiff?
3.Whether the suit is bad for mis-joinder and non-
joinder of parties?
4.Whether the plaintiff is entitled to the amount claimed
in the plaint?
11. On the side of the plaintiff, PW1 and PW2 were
examined and documents Exs.A1 to A11 were marked. On the side of the
defendants, no oral and documentary evidence was adduced.
12. The suit was dismissed by the trial Court by its
judgement and decree on 28/04/2000. Aggrieved over the same, an
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S.A.No.1687 of 2003
appeal was filed by the plaintiff before the Principal District Judge
Tuticorin, vide AS No.103 of 2000. The first appellate court allowed the
appeal, by reversing the judgement of the trial court. Against which, the
present appeal is filed by the appellant/2nd defendant.
13. At the time of admission of the second appeal, the
following substantial questions of law were framed:-
(a)Whether the findings of the lower appellate
court are vitiated by its failure to consider the absence
of any documentary evidence regarding the claim on
the basis of subrogation except Ex.A9 which is not
binding on the appellant and the admissions of PW1's
and 2?
(b)Whether the lower appellate court is right in
granting a decree as claimed in the absence of any
evidence regarding the alleged loss suffered? And
(c)Whether the lower appellate court is right in
granting interest at 18% per annum from the date of
plaint overlooking the provisions under Section 34 of
the Civil Procedure Code?
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S.A.No.1687 of 2003
14.The following additional substantial questions of law are
formulated by this Court for consideration of this Court:-
(1)Whether the learned First Appellate Court is right
in law in fixing negligence on the part of the appellant/2nd
defendant without adverting to the very document filed by
the plaintiff himself viz., the surveyor report marked as
Ex.A8?
(2)The learned First Appellant Court has committed
a serious error in law in reversing the well-considered
judgment and decree of the trial court, thereby fixing
liability upon the appellant, without adverting to the scope
and purpose of Section 8 of the Carriers Act?
(3)Whether the learned First Appellate Court is right
in law in decreeing the suit merely on the basis of Ex.A9,
the letter of subrogation given by the 3rd respondent,
completely overlooking the fact that the 1st
respondent/plaintiff had failed to produce the contract of
carriage as well as the original insurance policy entered
by the 3rd respondent?
15. The learned counsel appearing for the appellant/2nd
defendant during his argument contended that the following documents
have been omitted to be marked namely (i)Doc.3-Panchanama issued
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S.A.No.1687 of 2003
under Poladpur Police Station; (ii)Doc.4- Crime Registration Certificate
(in Marathi); (iii)Doc.5-FIR Copy (in Marathi) issued at Poladpur Police
Station; (iv)Doc.6-Statement issued at Mahada Municipality (Marathi);
(v)Doc.7-Receipt issued at Mahada Municipality (Marathi); (iv)Doc.10-
Photographs 8 nos; (vii)Doc.17-07.10.1985, Appointment letter issued to
recovery Agent M/s.BhaichandAmoluk& Co., by the plaintiff; (vii)Doc.
18-28/10/1985, Letter issued to Recovery Agent of the Plaintiff to the
defendants 1 and 2; (ix)Doc.20-04/12/1985, Letter issued by the
Recovery Agent of the Plaintiff to the 1st defendant.
16. Ex.A3 is the letter, dated 27/03/1985 issued by the 3rd
defendant to the defendants 1 and 2 intimating about the accident and
also demanded to compensate the damages I.e., sum of Rs.78,813.75.
17. He further contended that per the very document filed
along with the plaint i.e., Doc. Nos.17 and 18, which were not marked
for the reasons best known to the plaintiff), one M/s.Baichand Amoluk &
Co., was appointed as a recovery agent for the plaintiff. The said
M/s.Baichan Amoluk & Co., has sent a letter, dated 28/10/1985 to the
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S.A.No.1687 of 2003
defendants 1 and 2 claiming damages. For the said letter, the appellant
through his counsel has sent a reply dated 23/11/1985 (Ex.A6). The said
reply dated 23/11/1985 is very crucial. At the earliest point, the appellant
has clearly denied and disputed about the negligence. The crucial portion
of the reply dated 23/11/1985 is extracted for easy reference:-
“1.....Unfortunately the bundles could not be
delivered as my client's lorry TDL 6465 was dashed
against by lorry MWT 9293 and the accident
happened due to the rash and negligent driving by the
driver of lorry MWT 9293. Inspite of the best efforts to
my client's driver nothing could be salvaged as my
client's lorry was reduced to ashes.
2.The driver of the lorry MWT 9293 has been
prosecuted for his rash and negligent driving. As such
my client is not at all bound to pay any amount
towards the alleged loss of the bundles. A Xerox copy
of the proceedings of the police is herewith sent.
3.........Your client Sri Raja Rajeswari Wax
Matches has to book to the owner of lorry MWT 9293
and the Insurance Company only. My client is not
bound to make any payment to your client.”
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S.A.No.1687 of 2003
18. The learned counsel further contended that in the written
statement filed by both the defendants 1 and 2, they have specifically
disputed about the negligence. :- “In Para 4........ Page 3 of the written
statement, it was specifically stated as follows :
“The fact of the case and circumstances cannot in
anyway afford any right on the part of the plaintiff to claim
damages and foist the liability against this defendant as
accident was due to the criminal act of the driver who
dashed against the company of this defendant, the same
cannot be the reason for imposing the liability on the
defendant.”
19. Immediately after the accident, even as per the plea in
the plaint, the Insurance Company has appointed a surveyor (Para 7 of
the plaint) which reads as follows:-
“Para 7:- On 18.03.1985, the 1st defendant issued a
letter to the 3rd defendant informing the accident and
damages to the consignment. A surveyor was appointed
and he gave his survey report dated 19.03.1985 along with
the photographs depicting the accident.”
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S.A.No.1687 of 2003
20. The said surveyor's report dated 19/03/1985 is marked
as Ex.A8. The very own document filed by the plaintiff would clinch the
issue relating to the manner in which the accident had happened, as well
as whether the driver of the 2nd defendant/appellant was cause for the
accident. Besides whether the driver of the 2nd defendant has drove the
vehicle in a rash and negligent manner.
21. The report filed by the Surveyor, Ex.A8 dated
19/03/1985 would lead to an irresistible conclusion that the entire
accident has caused only due to the rash and negligent driver of the other
vehicle bearing No.MWT 9293.
22. As such the above contents of Ex.A8, the Surveyor's
report, itself would suffice to hold that the entire accident has happened
only due to the rash and negligent driving of the other vehicle bearing
No.MWT 9293. The corollary is that the driver of the appellant's vehicle
bearing No.TDL 6465 is not the cause for the accident and there is no
negligence on his part.
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S.A.No.1687 of 2003
23. The learned counsel, therefore, contended that the report
under Ex.A6 as well as the specific evidence of PW1 both in the chief
examination as well as in the cross examination would only lead to an
irresistible conclusion that the driver of the appellant's vehicle bearing
Registration No.TDL 6465 is not the cause for accident. On the other
hand, it is only the other driver of vehicle bearing Registration No.MWT
9293 is the cause for accident. As such, the corollary is that there is
absolutely no negligence in taking care of the goods, much less any rash
and negligent driving on the part of the appellant's vehicle.
24. He referred the provisions of the Carriers Act, 1865 and
stated that it decides the liability to pay compensation. He further relied
upon Section 8 of the Act, which is relevant to decide the issue.
25. Section 8 of the Carriers Act reads as follows:-
“Section-8: Common Carrier liability for loss or
damage caused by neglect or fraud of himself of his
agent:- Notwithstanding anything herein before contained,
every common carrier shall be liable to the owner for loss
of or damage to any [property (including container, pallet
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S.A.No.1687 of 2003
or similar article of transport used to consolidate goods)
delivered] to such carrier to be carried where such loss or
damage shall have arisen for the [***] Criminal Act of the
carrier or any of his agents or servants and [shall also be
liable to the owner for loss or damage to any such property
other than property to which the provisions of section 3
apply and in respect of which the declaration required by
that section has not been made, where such loss or damage
has arisen from the negligence of the carrier or any of his
agents or servants].”
26. The learned counsel for appellant, therefore, concluded
that reading of the above Section, it would reflect that every common
carrier is not straightaway liable to the owner for the loss or damage of
goods irrespective of the cause of accident. The said provision clearly
states that the carrier is liable only when via such loss or damage have
arisen from the criminal act of the carrier or any of its agents or servants.
27. On the other hand, the learned counsel for the first
respondent/plaintiff argued that it is the primary contention of the
appellant that the plaintiff is not entitled to maintain the suit on the basis
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S.A.No.1687 of 2003
of letter of subrogation (Ex.A9) and that there is no privity of contract
between the appellant and the plaintiff, however, in the final argument
before this Court, the appellant has not pressed the main ground.
Regarding the maintainability of the suit, the First Appellate Court
thoroughly examined the issue in para 21-22 of the judgment, discussing
several judgments of the Apex Court and held that the Insurance
Company's suit is maintainable. In the letter of subrogation and special
power of attorney, the insured clearly assigns all actionable rights to the
Insurance Company. This is not merely subrogation but also constitutes a
statutory assignment that allows the Insurer to sue in its own name. In
support of his contention, he relied upon the judgment of this court in
M/s.Ravichandran Transports, Mettur Dam Vs. United India
Insurance Company Limited, reported in 2000(1) CTC 748.
28. He further argued that it is the contention of the
appellant that the accident was not due to its lorry driver, but due to
another vehicle, this is purely a factual argument and the appellant failed
to plead or provide evidence to substantiate the contention in the trial
Court and no oral or documentary evidence was produced and that a
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S.A.No.1687 of 2003
second appeal cannot be used to rise new factual issue. In support of his
contention, he relied upon the following judgments namely (i)Kshitish
Chandra Purkait Vs. Santhosh Kumar Purkait, reported in 1997(5)
SCC 438; (ii)Kondiba Daguda Kadem Vs. Savitribai Sopam Gaja,
reported in 1999(3) SCC 722; (iii)Municipal Committee, Hosiarpur Vs.
Panjab SEB, reported in 2011(1) LW 525; and (iv)Umerkhan Vs.
Bismillah, reported in 2011(9)SCC 684.
29. It is further contended that Section 9 of the Carriers Act
imposes strict liability on carriers for loss, damage or non-delivery of
goods, that the burden of proving the absence of negligence lies on the
carrier, but not the plaintiff. In the present case the appellant has neither
produce the evidence nor pleaded that it was not negligent. Therefore,
the liability for the loss rests only on the appellant.
30. He also contend that the appellant contents that the
goods were already sold to the consignee (M/s.Manish& Co., Jodhpur)
and therefore, the 3rd defendant/consignor is not entitled to claim
damages. But it is not legally correct because at the time of the accident,
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S.A.No.1687 of 2003
the goods had not reached the consignee and the consideration was not
received. In this aspect the First Appellate Court correctly held that the
third defendant retained title to the goods at the time of the accident.
Ex.A1 is the invoice of the 3rd defendant and Ex.A2 is the lorry invoice
of the 1st defendant clearly establish that the 3rd defendant entrusted the
goods to the appellant for transport. The appellant admitted in the written
statement that he transported the goods which were damaged in the
accident. Therefore, the first appellate Court has given correct findings
and there is no merit in the second appeal and prayed for dismissing the
second appeal.
31. Heard the learned counsel on either side and perused the
materials available on record.
32. It reveals from the records that the loss of goods was
occurred due to a road accident. The plaintiff who is the insurance
company of third respondent claimed damages after receipt of letter of
subrogation. However the third respondent failed to produce any
documents to show that the accident occurred only due to the negligent
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S.A.No.1687 of 2003
act of the driver of the second defendant.
33. It is noted that the plaintiff/insurance company alone
engaged a surveyor to inspect the place of occurrence and to file a report.
The surveyor report, which was marked as Ex.A8, in which it was stated
as follows:
“In this accident which is consequently converted in
fire truck No.TDL-6465 and loaded goods (1992 bundles of
safety matches) are totally burnt down. The truck
No.MWT-9293, which has dashed on R/h side of truck
No.TDL-6465 was not available on the spot of accident,
when we had been to the spot of accident. However we
understand from the police that the truck driver of truck
no.MWT-9293, took his truck away from truck
No.TDL-6465 after accident and hence truck
No.MWT-9293 saved from the fire. The truck
No.MWT-9293 has sustained other damages in this
accident.
POLICE ACTION:
Poladur police station has registered the accident. Their
accident case No. is 12/85. Police from Poladpur police
station attended the spot of accident on 12/03/85 and
carried out the panchanama. Xerox copy of police
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S.A.No.1687 of 2003
panchanama collected from the representative of consignor
is attached with this report. Police from Poladpur police
station has investigated the crime, and kept the charges on
the driver of the vehicle No.MWT-9293, Shri
SarjeraoGanpatiPatil, under I.P.C. 279 & 427 and MVC
116, and submitted the charge sheet in Mahad Court. The
crime registration No. of Poladpur police station is 14/85.
34. The Surveyor’s Report and the contents of the FIR
clearly reveal that the accident did not occur due to any negligent act on
the part of the 2
nd
defendant/appellant, as alleged by the Insurance
Company. On the contrary, the materials on record establish that the
accident occurred when a truck bearing Registration No. MWT-9293,
proceeding from the opposite direction, dashed against the right side of
the vehicle driven by the 2nd defendant while crossing. There is
absolutely no evidence to prove that the accident occurred solely due to
the negligence of the appellant. Therefore, the appellant cannot be
fastened with liability for the loss and is not liable to indemnify the
Insurance Company.
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35. In support of the above contention, the learned counsel
for the appellant relied upon the judgment reported in 2024 (2) CTC 452,
(particularly paragraphs 20 and 21).
36. With regard to the title over the damaged goods, the
appellant contended that the third respondent had no subsisting title or
insurable interest in the goods at the time of the accident, since the entire
stock had already been sold to M/s. Minesh& Co., Jodhpur. The third
respondent failed to produce any agreement or other document to
establish that he had retained responsibility for safe delivery of the goods
after the sale, though the Insurance Company contended that the carrier
remained liable as the goods had not been delivered to the consignee.
37. The learned counsel for the appellant relied upon the
decisions reported in L.W. 284 (paragraphs 12 to 14) and 2020 (1) CTC
646 (paragraphs 30 to 32).
38. Ex.A1, the invoice dated 07.03.1985 issued by the third
respondent in favour of the purchaser, discloses that the goods were
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S.A.No.1687 of 2003
supplied on the account and risk of M/s. Minesh & Co. In the absence of
any document showing that the seller retained responsibility for the safe
delivery of the goods, Ex.A1 clearly establishes that the risk in the goods
had passed to the purchaser from the moment the goods were entrusted to
the carrier for transportation. Consequently, any loss sustained during
transit was the loss of the purchaser and not that of the third respondent.
39. Admittedly, the purchaser, who alone had the subsisting
interest in the goods at the relevant point of time, was not impleaded as a
party to the suit. Therefore, the suit suffers from non-joinder of a
necessary party. Further, in view of Ex.A1, the third respondent had no
insurable interest in the goods at the time of the loss and, consequently,
the letter of subrogation executed in favour of the Insurance Company is
unenforceable in law.
40. The Trial Court, upon a proper appreciation of the oral
and documentary evidence, rightly held that the plaintiff was not entitled
to recover any amount from the defendants and dismissed the suit on the
ground of mis-joinder and non-joinder of necessary parties.
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41. This Court finds no perversity, illegality or infirmity in
the findings of the Trial Court. However, the First Appellate Court failed
to properly consider the factual and legal aspects involved in the matter
and confined its discussion mainly to the question of subrogation,
ultimately fastening liability upon the appellant. Such an approach is
unsustainable. Accordingly, the findings and decree of the First
Appellate Court are liable to be set aside and the judgment of the Trial
Court deserves to be restored.
42. In the result, this second appeal is allowed, the
judgment and decree dated 12/12/2001 passed in AS No.103 of 2000 on
the file of the Principal District Judge, Tuticorin, are set aside and the
judgment and decree dated 28/04/2000 passed in OS No.11/1998 on the
file of the Subordinate Court, Kovilpatti, are restored. No costs.
Consequently, connected miscellaneous petition is closed.
01.06.2026
NCC :Yes / No
Index :Yes / No
er
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S.A.No.1687 of 2003
To
1.The Principal District Judge,
Tuticorin.
2.The Subordinate Judge,
Kovilpatti.
3.The Section Officer,
VR Section,
Madurai Bench of Madras High Court,
Madurai.
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R.POORNIMA, J.
er
S.ANo.1687 of 2003
01.06.2026
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Legal Notes
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