JUBILEE LIFE INSURANCE COMPANY Versus MUHAMMAD MASOOM
MALIK MUHAMMAD AWAIS KHALID, J.--- This appeal has been preferred under Section 124 (2) of the Insurance Ordinance, 2000 ( the Ordinance ) read with section 151 C.P.C. against impugned judgement and decree dated 28.02.2022 (herein after called as impugned judgment and decree ) passed by learned Additional District Judge, Jhelum where suit filed by plaintiffs-respondents (herein after called as respondents ) for recovery of Rs.950,000/- was decreed in their favour and against Jubilee Life Insurance Company (herein after called as appellant ). The respondents were entitled to get the death claim of Malik Muhammad Shafi (herein after called as policy holder ) being nominee for insurance policy bearing No.262721 dated 27.06.2012 (Hifazat Plan) along with costs as well as mark-up @ 10% from 05.08.2013 i.e. date of death of policy holder till the realization of decretal amount.
2. Brief facts of the case are that respondents being legal heirs of policy holder instituted suit against the appellant for the recovery of Rs.950,000/- on the ground that the policy holder obtained insurance policy No.262721 dated 27.06.2012 from appellant and also deposited two premiums Rs.50,000/- per year in the year 2012 and 2013, that policy holder nominated respondent No.1 as nominee. That policy holder died on 05.08.2013, who was not suffering from any prolong or chronic disease at the time of obtaining insurance policy as well as the time of death, leaving behind the respondents as his legal heirs. Policy holder died suddenly due to cardio pulmonary arrest and after his death respondent No.1 approached the appellant for claim of insurance of policy holder and representative of insurance company got his signatures on blank papers for preparation of insurance claim and thereafter, appellant got prepared a false statement on his behalf with mala fide intention mentioning therein that deceased policy holder was patient of diabetes and hypertension which was incorrect and against facts. On 13.10.2014 and 27.10.2014 respondents issued notices to appellant for payment of insurance claim but to no avail and in this respect the respondents approached the Insurance Ombudsman, who advised them to approach proper forum, vide order dated 25.02.2016. Respondents time and again asked for payment of insurance claim of policy holder but appellant refused, hence, suit for recovery was filed on 13.12.2017.
3. Appellant contested the suit by submitting written statement raising legal and factual objections with the contentions that policy holder at the time of obtaining insurance policy concealed the facts with respect to his health due to which respondents are not entitled for claim benefit from the appellant and prayed for dismissal of the suit.
4. Out of the divergent pleadings of both the parties, the following issues were framed on 22.06.2019 which are reproduced as under:
ISSUES:
1. Whether plaintiffs are entitled to recover an amount of Rs.9,50,000/- vide police No.262721 dated 27 06.2012 of late Malik Muhammad Shafi? OPP
2. Whether plaintiffs have no cause of action to file this suit? OPD
3. Whether plaintiffs have not come to the court with clean hands? OPD.
4. Whether plaintiffs have no locus standi to file the present suit? OPD.
5. Whether suit of the plaintiffs is not maintainable in its present form? OPD.
6. Whether suit of the plaintiffs is devoid of law, false, frivolous and concocted one, hence, the same is liable to be dismissed with special cost under section 35-A, C.P.C.? OPD
7. Relief.
5. After framing of issues, the parties produced oral as well as documentary evidence. Respondent No.1 himself appeared as PW-1 and tendered following documents, Affidavit of plaintiff Ex.P.1, Death certificate Ex.P.2., Policy letter Ex.P.3, Proposal form Ex.P.4/A-1(1), Application for death claim Ex.P.5, Death certificate Ex.P.6., Correspondence letter with Jubilee Insurance Company Ex.P.7, Legal notices Ex.P.8 and Ex.P.9 and Copy of order passed by the Hon'ble Lahore High Court, Rawalpindi Bench, Rawalpindi in writ petition as Ex P.10.
6. Conversely, Usama Javed, Executive Officer of appellant appeared as RW-1 and relied on following documents: Client certificate, doctor certificate, certificate of identity as Ex.D.2, Application for claim of policy Ex.D.3., Discharge summary along with patient's IPD Bill as Ex.D.4, Death certificate issued by THQ, Hospital Sohawa, death certificate of union council, death certificate issued by private doctor Ex.D.5, Reply of purported legal notice Ex.D6, Death claim letter Ex.D.7, Letter of reply Ex.D.8, Attested copy of order of Hon'ble Federal Insurance Ombudsman Court Ex.D.9 and Verification of Medical report Ex.D.10.
7. Learned Additional District Judge, Jhelum, vide impugned judgment and decree dated 28.02.2022, in favour of respondents and held them entitled to recover Rs.950,000/- from the appellant with costs as well as mark-up @ 10% from 05.08.2013 i.e. date of death of policy holder till the realization of decretal amount. Hence, instant R.F.A.
8. We have heard the learned counsel for the parties at a considerable length and scanned the entire material available on the record with their able assistance.
9. It is submitted by the learned counsel for the appellant that contract of insurance is a contract of "Utmost Good Faith" and according to its doctrine, the policy holder should disclose all real facts regarding his age, occupation, past history of health, which could have bearing on the decision of granting life insurance coverage. The policy holder is responsible for furnishing the material facts to the insurer and any concealment by him renders the policy null and void from the commencement. Learned counsel for the appellant emphasized on the point that policy was issued to the policy holder on providing wrong information regarding his health, which subsequently proved incorrect rendering the insurance policy void. Hence, impugned judgment and decree dated 28.02.2022 passed by learned Additional District Judge is illegal, without jurisdiction, arbitrary and result of misreading and non-reading of evidence on record necessitating remand of the case to learned Additional District Judge with the direction to frame specific issue with respect to claim of liquidated damages and decide the matter after providing fair opportunities to the parties. Learned counsel for the appellant relied upon case law 1 . At the fag-end of this submission, learned counsel for the appellant requested that appeal may graciously be allowed and impugned judgment and decree dated 28.02.2022 be set aside and respondents claim be dismissed with costs. Conversely, learned counsel representing the respondents has faithfully defended the impugned judgment and decree.
10. It transpires from the record that the policy holder while purchasing insurance policy bearing No.262721 dated 27.06.2012 (Hifazat Plan) of Jubilee Insurance company had appointed respondent No.1 as nominee. Later on, unfortunately he died natural death on 05.08.2013. The record further reflects that policy holder was not suffering from any prolong or chronic disease at the time of purchasing of his above referred policy. After the death of policy holder, respondent No.1 approached to the appellant for claim of insurance of policy but in vain, inspite of lapse of 11 years, claim of respondents is still unpaid. It was the duty of insurance company to conduct medical examination of policy holder prior to issuance of policy, who did not opt to do so, as evident in statement of RW-1. The appellant has no legal or moral justification to reject the death claim of policy holder. The appellant consecutively received two annual premiums of Rs. Fifty thousand per year. The appellant has not investigated the health condition of policy holder within due time. In the cross-examination RW-1 stated that:
Now appellant cannot approbate and reprobate by shifting the burden to policy holder in order to escape its liability 2 .
11. Usama Javed, Executive Officer of Jubilee Insurance appeared as RW-1, who submitted his affidavit Ex.D.1., admitted in cross-examination that policy holder was not suffering from any disease and was died due to sudden heart attack. Significantly the documents which were tendered by appellant counsel as Ex.D.1 to Ex.D.10/1-2. It is pertinent to mention that according to principle settled by Apex Court in the number of cases 3 , documents should be produced in the evidence by the party itself and a fair opportunity should be given to the opposite party to cross-examine the same, therefore, documents produced by the appellant/defendant counsel in his statement could not be taken into consideration 4 . The documents have been tendered in evidence through counsel's statement, documents cannot be considered as per settled law that the disputed documents cannot be tendered in evidence in statement of the counsel for a party because such procedure deprives the opposing party to test the authenticity of those documents by exercising his right of cross-examination. Thus, all those documents brought on record in the statement of the learned counsel for the appellant were inconsequential.
12. Further as it was asserted by the appellant that the policy holder concealed the material information while submitting the proposal form regarding his pre-insurance ailment, the onus to prove above assertion under Articles 117 and 127 of the Qanun-e-Shahadat Order, 1984 was upon the appellant to substantiate the asserted stance through trustworthy and believable evidence but the appellant failed to prove through any record rather just tendered documents through counsel which cannot be taken into consideration.
13. The medical reports generated and statements made in relation to the life issuance policy have been in line of both Insurance Act, 1938 (the Act ) and the Ordinance. The apex Court of the country has pondered upon this legal issue and has invariably held 5 as under:
6. .the respondent cannot be held to account for any non-disclosure such as would enable the insurer to escape liability on the policy unless there is fraud or a fraudulent misrepresentation ..
Even if one considers that the policy holder suffered from the ailment mentioned in terms of Hypertension or Diabetes etc. the insurer at the time of insurance must satisfy itself and should get the prospective buyer of the policy medically checked up to its satisfaction 6 .
14. It reflects from the record that the appellant has never challenged the validity of death certificate which is the official document and presumption of truth is attached to it and the same should be taken into consideration. It transpired from the record that insurance claim was lodged by the respondents with the appellant by complying with all procedural requirements, however, the appellants had badly failed to make due payment (within time) under the law and the learned Additional District Judge had rightly decreed the suit for recovery of claim along with liquidated damages as prescribed under section 118 of Insurance Ordinance (XXXIX of 2000), which is reproduced as under:-
It shall be an implied term of every contract of insurance that where payment on a policy issued by an insurer becomes due and the person entitled thereto has complied with all the requirements, including the filing of complete papers, for claiming the payment, the insurer shall, if he fails to make the payment within a period of ninety days from the date on which the payment becomes due or the date on which the claimant complies with the requirements, whichever is later, pay as liquidated damages a sum calculated in the manner as specified in subsection (2) on the amount so payable unless he proves that such failure was due to circumstances beyond his control
15. While seeking guidance from the case law supra, we are fully convinced that learned Additional District Judge has therefore rightly appraised the evidence and decided the matter in favour of respondents and no illegality, therefore, exists in the impugned judgment and decree.
16. Upshot of above discussion is that reasoning advanced by learned Additional District Judge, Jhelum calls for no interference. This appeal is without merits and accordingly dismissed with no order as to costs.
MQ/J-17/L Appeal dismissed.
1 Premier Insurance Limited through Authorized Officer v. M/s Ihsan Yousaf Textile Private Limited through Director and 3 others (2023 CLD 135) and Muhammad Huzafa v. American Life Insurance Company (Pakistan) Ltd. (ALICO) through Chairman/General Manager/Managing Director and another (2013 CLD 1470)
2 Mst.Nazeeran and others v. Ali Bux and others (2024 SCMR 1271)
3 Mst. Hameeda Begum and others v. Mst. Irshad Begum and others (2007 SCMR 996), Federation of Pakistan through Secretary Ministry of Defence and another v. Jaffar Khan and others (PLD 2010 SC 604) and Province of the Punjab through Collector, Sheikhupura and others v. Syed Ghazanfar Ali Shah and others (2017 SCMR 172)
4 Rustam and others v. Jehangir (deceased) through LRs . (2023 SCMR 730)
5 State Life Insurance Corporation of Pakistan v. Atta ur Rehman (2021 SCMR 1347)
6 State Life Insurance Corporation of Pakistan through Chairman and another v. Razi-ur-Rehman (2009 CLD 1666), Khurshid Ali and 6 others v. Shah Nazar (PLD 1992 SC 822), State Life Insurance Corporation of Pakistan and another v. Mst. Zubeda Bibi (2024 SCMR 426) and State Life Insurance Corporation and another v. Mst. Razia Ameer and another (2023 CLD 517)