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Sowamma v Life Insurance Corporation of India [2015] FJMC 1; Civil Action 318.2011 (2 January 2015)

IN THE FIRST CLASS MAGISTRATES COURT
AT SUVA
CIVIL JURISDICTION
Civil Action No. 318/2011

BETWEEN:

SOWAMMA f/n Adimula of Lot 2 Boreta Road, Nadawa, Nasinu, Fiji Domestic Duties, and Administratix of the estate of, RAM LINGAM f/n Pachiappa Gounden, Managing Director, formerly of Lot 3 Boreta Road, Nadawa, Nasinu, Deceased, Intestate.
PLAINTIFF

AND:

LIFE INSURANCE CORPORATION OF INDIA an insurance company duly incorporated in India and having its registered office at LICI HOUSE, Butt Street, GPO Box 266, Suva, Fiji.
1st DEFENDANT

AND:

VIJAY NAIR an agent of Life Insurance Corporation of India, Suva, (Address unknown to the Plaintiff).
2nd DEFENDANT

Ms. Preetika and Mr.Meru for the Plaintiff
Mr.Maharaj for the Defendants

JUDGMENT

INTRODUCTION

1. The Plaintiff filed a writ of summons on 25th July 2011 against the defendants seeking following orders inter alia:
   
   1. The sum of $30,000.00 [Thirty Thousand Dollars] together with any bonus thereof.
      
   2. Cost and Interest on sum(s) at such rate and for such period as this Honorable Court shall think fit.
      
   100. Such further and or other relief as this Honorable Court may deem just.
        
2. The plaintiff based her claim on the basis the defendants failing to pay the insurance policy for the deceased husband.
   
3. The defendants filed their statement of defence on 08th September 2011 in which they admitted the policy was repudiated by the 1st defendant for the material non discloser by the deceased. In reply to the defence dated 18th October 2010 the plaintiff denied the allegation by the defendants.
   
4. Minutes of Pre- Trial conference were as follows:
   

AGREED FACTS

1. THAT the First Defendant is a duly incorporated Company liable to be sued in by its corporate name and style which at all relevant times carried on business as an insurer and the 2nd Defendant is an agent of the 1st Defendant.
   
2. THAT the Second Defendant at all material time was an agent of the First Defendant.
   
3. THAT a Policy of Insurance no. 2493322 was made between the deceased and the 1st Defendant in consideration of the premiums paid to them in the sum of $2,423.80, the 1st Defendant agreed to insure the life of the said Ram Lingam, in the sum of $30,000.00 together with such sum or sums as shall accrue to the said policy by way of bonus and upon proof of death of the said Ram Lingam, to pay the said sum together with any bonus to his administrators or assigns.
   
4. THAT Ram Lingam died on the 15th day of November 2009 while the said policy was still in force.
   
5. THAT the Plaintiff lodged a claim with the First Defendant following the death of Ram Lingam and a death claim form together with a death certificate was produced to the 1st Defendant.
   

ISSUES OF DETERMINATION

6. WHETHER the deceased suffered from Diabetes Mellitus before or at the time of proposal for the insurance policy?
   
7. WHETHER there was material non-disclosure by the deceased in failing to disclose this fact to the Defendant.
   
8. WHETHER the Second Defendant negligently fills this addendum proposal form, if so, in what way was he negligent?
   
9. WAS the First Defendant entitled to repudiate the Policy on grounds of non-disclosure, if so, was such repudiation justified?
   
5. The Plaintiff’s case was conducted on 04th and 05th November 2014 while the defendant called his witnesses on 19th and 20th November 2014. At the end of the hearing both parties opted to file closing submissions which were filed accordingly. I have carefully considered them also for this judgment.
   

PLAINTIFF’S CASE

6. For the plaintiff two witnesses were called. PW1 was the plaintiff , Ms. Sowammma wife of the deceased said she got married to the deceased in 1972 ( marriage certificate was marked as PE-01) and her husband had a construction business. The husband passed away (death certificate marked as PE-02) and she got letter of administration ( PE-03). She was the nominee under the insurance policy but was not given the claim. The claim statement was marked as PE-04. She knew the 2nd defendant who came to her home twice. In cross- examination she said the insurance company did not tell the reason for the rejection of her claim . She personally went to hand over the claim but was not told it was incomplete and she also did not go to Suva private to get additional documents. She admitted getting a letter from the Insurance Company on 08th April 2010 advising the claim to be stamped by a doctor. The witness said she was not aware that her husband suffered from diabetics or took insulin injection to control sugar. She was also not aware that he took medication. The witness was shown the medical attendance certificate from the agreed bundle and which was explained to her by her son earlier. She answered negative when asked questions based on the report about the time the deceased had Diabetes Mellitus ( 10 years) but agreed that the deceased was treated in a Primary health center. Her son told her about the doctor who attended to the deceased in the Suva private . She maintained that her husband never suffered from Diabetes . She also said that the proposal form was filled by the 2nd defendant and agreed that the insurance company has right to cancel the policy if the information given was not true regarding the health . She also said in the policy the deceased submitted that he was not suffering from diabetes. In re- examination she was shown her claim form and agreed with that.
   
7. PW2 was Rahul Goundar , the son of the deceased who was aware about the insurance policy. His father was in good condition and the witness was not aware he was suffering from diabetes. In cross- examination PW2 said he was 16 years old the time the father passed away and he knew the policy was taken on December 2008. He went to see the father in Suva private when he was admitted there for a week. The deceased had a chest pain and a heart problem and PW2 spoke to the doctor who attended to the deceased ( Dr.Pawar) . He has seen the claim form but was not aware of the content. The witness also told that his father never mentioned he was suffering from diabetes. He was also shown Discharge report ( document 11 from the agreed bundle) and said if his father told the doctor about the medical condition the doctor could have also told him about that. PW2 was also not present when the doctor examined the deceased for the policy. In re- examination the witnesses reiterated that his father did not mention about diabetes to him.
   

DEFENDENDENT’S CASE

8. The defendants called only 04 witnesses. DW1 was Ms. Taina Talakubu , assistant manager of LICI and she was aware of the proposal made by late Ram Lingam(deceased) . The wife was the nominee and the form was filled by the 2nd defendant. The proposer agreed that he was telling truth and if it is incorrect the policy would be null and void. It was signed by the deceased and witnessed by the 2nd defendant and also signed by Dr. Bogitini . The medical examiner confidential report showed everything was negative. DW1 received a complaint from the plaintiff on 30th December 2009( DE-01) and responded to it through a letter on 21st January 2010( DE-02). The plaintiff brought the claim form to the office and the LICI wrote back to her on 08th April 2010 ( DE-03) . The witness also identified the insurance policy and this was marked as DE-04. Certificate of employment was tendered as DE-05 and the rejection of claim was marked as DE-06. The reason for rejection was that the deceased failing to mention about his health. DW1 received a letter from the solicitors of the plaintiff ( DE-07) and replied to that( DE-08) .In cross- examination the witness said she was familiar with the insurance policies and a person has to fill a proposal and a addendum . The deceased was medically examined and granted the policy. The declaration of the deceased was certified by Dr. Bogitini . The doctor is in the panel of doctors for LICI and according to the report he cleared the deceased from any illness. She also agreed that even though deceased passed away on 15th November 2009 Dr. Pawar prepared medical attendance certificate only on 16th February 2010. In re- examination the witness said the doctor recorded the answers given by the deceased and the information contained in documents 9,10 and 11 in the agreed bundle were given by the deceased and the forms were completed only after the claim was lodged .
   
9. DW2 was Dr. Gene Bogitini who examined the deceased in 2009 for the insurance policy. He was examined on 06th January 2009 and he was answered whether he got any diabetes or high blood pressure and the deceased replied negative. If the deceased informed the doctor about diabetes DW2 could have carried out further tests. The deceased could have a normal reading if he was controlling the sugar. DW2 wrote what the deceased told him . He also had a look at the discharge report ( document 11 from the agreed bundle) which showed that he was on insulin injection to control his blood sugar. Patient notes ( document 12 from the agreed bundle) revealed that the deceased was suffering from diabetes for 10 years prior to the admission . In claim form ( document 9 from the agreed bundle) the primary cause was Acute Myocardial Infarction and the secondary cause was Coronary Artery Disease , Diabetes Mellitus and Dyslipedemia which is high cholesterol level. The deceased or his relatives could have given the information to the Suva private but the deceased failed to mention about these to DW2 when he was first examined for policy . In cross- examination he said he is in the panel of LICI and the medical examination would be carried out according to the information supplied by the policy holder. The deceased came with the 2nd defendant and if there were any further tests the LICI would pay for that. DW2 conducted the urine test also and when inquired if a person had a diabetes and could have shown from the urine the witness said if the person kept it under control then the result could have been negative. The witness also said that the primary cause of death of the deceased was heart attack and secondary causes would lead to the demise and also diabetes is a major risk factor for the hearth attacks. In re- examination the witness said the deceased answered negative to all the questions in the examination and this was put in the report.
   
10. DW3 was Dr. John Alfred , a doctor from Suva Private and he said the hospital had a folder for the deceased( Document 11 from the bundle). The deceased was seen first time by Dr,Pawar on 09th November 2009 and was admitted on the same date. He was discharged on 12th November 2009. Dr. Pawar attended to the deceased and DW3 recognized his handwriting. The history was given by the patient and the deceased was first treated for Diabetes 10 years back and was treated by primary health center. The information was given by the deceased to Dr. Pawar. In cross- examination the witness said he worked with the Dr.Pawar for nearly 02 years and could recognize his handwritings and the signature and also he was not in the panel of LICI. In re- examination he said the history given by the adult patients are more accurate and according to the documents the history was given by the deceased. DW3 was also familiar with the handwritings of Dr.Pawar.
    
11. DW4 was Vijay Nair, the 2nd defendant who filled the proposal based on the answers given by the deceased. He was also explained about the declaration. In cross- examination the witness said that he clarified the content to the deceased and he was present when the examination was done by Dr.Bogitini .
    
12. In closing submission filed by the learned counsel for the plaintiff she submitted that there was no direct evidence to prove that the deceased was suffering from Diabetes prior to securing the policy and therefore the plaintiff is entitled to the claim under the policy as a nominee.
    
13. In his detailed submission the learned counsel for the defendant argued that the deceased deliberately gave false information regarding his health and therefore the defendant was entitled to decline the claim made by the plaintiff.
    

ANALYSIS

14. As mentioned earlier following were raised in pre- trail conference as issues to be determined in this case.
    
    1. WHETHER the deceased suffered from Diabetes Mellitus before or at the time of proposal for the insurance policy?
       
    2. WHETHER there was material non-disclosure by the deceased in failing to disclose this fact to the Defendant.
       
    100. WHETHER the Second Defendant negligently fills this addendum proposal form, if so, in what way was he negligent?
         
    4. WAS the First Defendant entitled to repudiate the Policy on grounds of non-disclosure, if so, was such repudiation justified?
       
15. During the hearing the plaintiff never gave evidence about negligent of the 2nd defendant in filling the addendum form or put that issue while in cross- examination of defendant’s witnesses. Therefore I would decide issue C in favor of the defendants.
    
16. Therefore main issues to be determined in this case is whether the deceased suffered from Diabetes before the proposal and whether there was material non-disclosure by the deceased in failing to disclose this fact to the Defendant.
    
17. The plaintiff position in this case is that the deceased did not have diabetes before the policy was signed and therefore there was no need to disclose this in the proposal. To substantiate this claim the evidence was led of the wife of the deceased ( plaintiff) as well as his son. They said the deceased did not suffer diabetes and he was healthy before passing away. This was maintained even confronted with the medical reports from Suva Private which was prepared by Dr.Pawar who has gone back to India. The plaintiff also relied on the medical examination conducted by Dr.Bogitini for the policy. In the medical examination urine test was conducted on the deceased proved negative.
    
18. But Dr.Bogitni in his evidence said the deceased informed he that he was not suffering from diabetes or any other illness and therefore no further test was conducted. Also with regard to urine test being negative he said a patient who controlled his sugar level could not show the sugar in the urine. This witness is an expert witness and can give this opinion based on his field.
    
19. As for the medal reports prepared by Dr.Pawar it showed that the deceased suffered from Diabetes Mellitus for 10 years prior to admission and was under medication. According to these reports the history was given to the Dr.Pawar by the deceased himself.
    
20. In this case the defendant cannot be called to confirm about this. Also Dr.Pawar who recorded the deceased alleged admissions is no longer in the country . Therefore the defendant gave evidence pursuant to Civil Evidence Act and tendered these documents through another doctor.
    
21. In her closing submission the learned counsel for the plaintiff argued that these reports are hearsay and does not prove that the deceased had diabetes. Section 03 of the Civil Evidence Act specifies that the evidence must not be excluded on the ground of hearsay and weight to be given to hearsay evidence has been considered in section 06 which states that :
    

“In estimating any weight to be given to hearsay evidence in civil proceedings, the court must have regard to any circumstances from which any inference can reasonably be drawn as to the reliability or otherwise of the ece , and in particulaicular to the following-

(a) whether it would have been reasonable and practe for the party by whom the evidence& was adduced to hato have produced the maker of t of the original statement as a witness;

(b) whether the original statement was made contemporaneously with the occurrence or existence of the matters stated;

(c) whether the evidence&#16volves multipletiple hearsay;

(d) whether any person involved had any motive to conceal or misrepresent matters;

(e) whether the original stnt was an edited account, ont, or was made in collaboration with another or for a particular purpose;

(f) whether the circumstances in which the evidence is addas hearsay are such such as to suggest an attempt to prevent proper evaluation of its weight."

22. In case the person rson who mwho made these admissions ( Ram lingam) is deceased and cannot be called as a witness . And also the person who recorded these admissions has gone back to India. But these admissions were made by the deceased just before he passed away and there were no evidence to suggest they were edited by the Dr. Pawar who recorded these. Having considered all these I believe I can accept the medical reports prepared by Dr. Pawar.
    
23. All these medical reports [Medical Attendance Certificate ( Document 9), Certificate of Hospital Treatment (document 10) , Patient Notes (document 12)] shows that the deceased was suffering for Diabetes Mellitus for 10 years. This was contrary to his admissions in the policy where he stated that he was not suffering from any diseases , especially diabetes.
    
24. In the policy the deceased agreed that if he gave false information the contract between him and the LICI will be null and void. The Fiji Court of Appeal in Blue Shield (Pacific) Insurance Ltd v Wati [1997] FJCA 25; Abu0048u.95s (14 August 1997) said:
    

"The duty of disclosure is distinct from the requirement not to misrepresent facts. It arises out of the fact that a contract of insurance is a contract uberrimae fidei. A person seeking to be insured must disclose to the intended insurer any facts within his or her knowledge that are material, that is to say which would affect the mind of a prudent insurer in deciding whether or not to provide cover".

25. Also Section 11 of the Insurance Law Reform Act 1996 requires that the Insurer and the Insured to act with utmost good faith towards each other.
    
26. In this case from the evidence I find that the deceased failed to disclose to the LICI that he was suffering from diabetes which he was well aware of . The witness from the LICI agreed that if this was disclosed maybe they could have still grant the policy subject to charging a higher premium. But the deceased failed to disclose this vital information and therefore LICI is entitled to repudiate the Policy on grounds of non-disclosure.
    
27. Therefore I find that the plaintiff has failed to prove her claim on balance of probabilities and decline to grant the reliefs prayed in her claim.
    
28. Accordingly I grant the following orders.
    
    1. Writ of summons is dismissed
       
    2. Cost of $1500.00 summarily assessed to be paid to the defendant .
       
29. 30 days to appeal.
    

02nd January 2015

H.S.P.Somaratne
Resident Magistrate