1989 PLP 1752 (MLD)

Issue No. 1: The claim in the suit is made 6n account of the losses suffered by the plaintiff to the motor parts and accessories at his shop and godown at shop premises No. 1,2,3, Nawabpur Road, Dacca, wherein he had his stock of goods in business and trade of the total value of over Rs. 1,25,

000. The stock of motor parts and accessories was insured with the defendant No.1. The defendant No.1 issued fire policy Ext. 6/8. This policy was issued on 30-11-1970. P.W. I Khalid Ahmed (Ext.6) has stated that on account of political disturbances toe mob attacked, ransacked the business and set on fire. This occurred on 3-3-1971. The entire stock of the shop yeas burnt and looted. He lodged the F.1.R. (Ext. 6/1). He informed the defendant No.1 about the incident and received reply dated 22 3-1971 (Ext. 8/2). The Insurance Company appointed Surveyors who surveyed the loss. The Surveyors sent a letter dated 23-4-1971 (Ext.6/3). The Surveyors carried out the survey and submitted survey report (Ext.6/4). The defendant No. 2 sent a letter dated 8-11-1971. The plaintiff sent a reply dated 12-11-1971. The plaintiff served legal notice dated 11-2-1974 (Ext. 6/5). The defendant No. 2 sent a reply dated 25-2-1974 (Ext. 6/6). The defendant No.1 also sent reply 2-3-1974 (Ext 6/7). The fire policy issued by defendant No. 1 in favour of plaintiff was produced as Ext. 6/8. P.W.1 in his cross examination sta.--d as under "it is correct that in February and March 1971 there was civil commotion in Bngla Desh and there was tension between the local Bengali, and other sections of the population known as Non-Bengalies. It is correct that on 25th March 1971 the local population were agitating against the Pakistan army and non-Bengalis. When my shop was burnt the civil commotion was going on in the country." P W 2 Shahid Ahmed (Ext.7) stated that "this was shop of spare party of motor automobiles. On 3-3-1971 4 was set on fire by a mob m Dacca. At the time when the shop was burnt, there were goods and stocks in the shop which were worth Rs. 1,25.1100. The civil commotion and riot were continuing for about a ear or two before this account took place. Before 25-3-1971 the rioting and arson aggravated and it became; at a position of rebelling against the established Government." Mr. Ahis Ahmed contended that the loss suffered by the plaintiff on 3-3 1971 is covered under the riot and strike enforcement of the policy (Ext 6/8). While the defendant No.1 has taken the stand that the conditions prevailing in the then territory of East Pakistan, can by no means be described as a riot or "Civil Commotion" as d was outright rebellion of the people against the then existing political status quo in the country, as such the loss suffered by the plaintiff, if any, is not payable under the fire policy Mr. Abdul Rauf submitted that the defendants are not liable. In support of his submission, reliance is placed on PLD 1981 Karachi 451 and 1986 CLC

740. He has also placed reliance on certain passages appearing in white paper, "The Last Days of United Pakistan" by G.M. Chaudhry, "Witness to Surrender by Siddiq Salik, "The East Pakistan Tragedy" by L.F. Rushbrook Williams and "Contemporary Pakistan" by Dr. Manzooruddin Ahmed. The cases reported in PLD 1971 Karachi 451 and 1986 CLC 740 cited by the learned counsel for the defendants support their contention. My brother Saeeduzzaman Siddiqui, J. has already referred td pages 13, 14, 22 and 27 of the white paper. In the East Pakistan Tragedy by L.F. Rushbrook Williams at page 127, it is stated: "March

3. Mob violence spread to Islampur, Patria Khali Bazar, Nawabpur and other suburbs. Shops, business and private houses were looted and set on fire, with the loss of lives and killed and 62 wounded:" Clause 6 of the policy of insurance containing the terms excepting the defendant company from liability in case of mutiny, riot, military or popular rising, insurrection, rebellion is in these terms: "

6. This insurance does not cover any loss or damage occasioned by or through or in consequence directly or indirectly, of any of the following occurrences, namely:-- (a) Earthquake, volcanic eruption or other convulsion of Nature. (b) Typhoon, hurricane, tornado) cyclone or other atmospheric disturbances," (c) War, invasion, act of foreign enemy, hostilities or warlike operations (whether war be declared or not), civil war. (d) Mutiny, riot, Military or popular rising, insurrection, rebellion, revolution, Militia or usurped power, martial law or state of siege or any of the events or causes which determine the proclamation or maintenance of martial law or state of siege. Any loss or damage happening during the existence of abnormal, conditions (whether physical or otherwise) which are occasioned by or through or in consequence, directly or indirectly, of any of the said occurrences shall he deemed to be loss of damage which is not covered by this insurance, except to the extent that the insured shall prove that such loss or damage happened independently of the existence of such abnormal conditions. In any action, suit or other proceeding where the Company alleges that by reason of the provisions of this condition any loss or damage is not covered by this insurance, the burden of proving that such loss or damage is covered shall be upon the insured. Neither riot nor civil commotion has been defined in the policy of insurance. But, it is a settled rule of a judicial construction that where terms of legal art are used in a policy of insurance, they must be given their, technical A meaning. Therefore, riot when it occurs in a policy of insurance, is to be interpreted with the special meaning attached to it by the criminal law. London and Lancashire Fire Insurance Company v, Bolands Ltd., 1924 A.C. 836 at

847. The exception of riot in a policy of insurance must be understood in its strict legal and not m its popular signification. Field v. Receiver of Metropolitan Police (1907) 2 K.B.

853. The principle that where words are used in an instrument which have well recognized legal connotation, it will be presumed that they have been used in that sense, unless a contrary intention clearly appears from the context or other relevant evidence. The word `riot' is a word which has a legal meaning and in my opinion that is its primary meaning, and before I can be persuaded to give it any other meaning, I must be fully satisfied that from the I instrument itself or from the circumstances of the case, the parties intended to give it any other meaning. The word `riot' in the policy of insurance in this case shall, therefore, have to be given its legal meaning, which it has in the Pakistan Penal Code. `Civil Commotion,' on the other hand, has no such strict legal meaning, but yet it has come to have a fixed meaning by recognized judicial interpretation. This phrase was first introduced as an exception in the London Assurance Fire C Policies m 1720. Lord Mansfield in Langdale v. Mason (1780) Martial Third Edition 791 at 794=Park's Insurance, 8th Edition, Volume, pale 965 defined it as "an insurrection of the people for General purpose though it may not amount to a rebellion". Although a civil commotion may, technically speaking, also constitute a riot as per Lord Birkenhead in Moto Union Insurance Company Ltd. v. Beggan (1923) 130 L.T. 588 at page 591, the phrase is used to indicate a stage between a riot and civil war, (See Republic of Bolivia v. Indemnity Mutual Marine Insurance Company Ltd., (1909) K.B. 785 at

800. Under Section 146 of Penal Code: Whenever force or violence is used by an unlawful assembly, or by any member thereof in prosecution of the common object of such assembly, every member of such assembly is guilty of the offence of rioting." The essential ingredients of the offence therefore are:- (a) There must be an assembly of five or more persons. (b) It must have for its common object one of the five unlawful objects specified in section 141 of the Pakistan Penal Code, so that it becomes an unlawful assembly. (c) force or violence must be used by such an unlawful assembly or by any member of it, in prosecution of the common object of such assembly. It is stated in "Welford and Otter-Barry's Fire Insurance, Second Edition at page 66 that:-- "Civil commotion' phrase is used to indicate a stage between a riot and civil war. It has been defined to mean an insurrection of the people for general purposes though not amounting to a rebellation; but it is probably not capable of any very precise definition. The element of turbulence or tumult is essential, an organised conspiracy to commit criminal Acts, where there is no tumult to disturbance-until after the acts, does not amount to civil commotion. It is not, however, necessary to show the existence of any outside organisation at whose instigation the acts were done." This statement appears to be accurate and to be borne out by the several authorities cited in the notes to the text. In Pan American World Airways Inc. v. Anta Casulty and Surety Company (1974) 1 Lloyds Law Reports 207 where the hijacking of a plane by two persons, even though they were later joined by a third person to help with its demolition was held not to be a riot' because there was no tumultuous conduct (See the judgment of Frankel at page 234). The decision was subsequently affirmed by the U.S. Court of Appeals (1975) 1 Lloyd's Law Reports

77. The definition of a `riot' as given in Field v. Receiver of Metropolitan Police (1907) K.B. 853 was adopted in the case reported in Athens Maritime Enterprises Corporation v. Hellenic Mutual War Risks Association (Bermuda) Ltd. The Andreas Lemos (1983) O.B.647; (1983) 1 AER 590, (1982) Lloyd's Law Reports

483. The question arises whether at the time of the alleged loss or damage by fire of the insured shop of the plaintiff, there was riot/civil commotion or a popular rising within the meaning of condition 6 of the policy. The plaintiff lodged the F.I.R. on 5-3-1971 (Ext. 6/1). In the letter dated 8-3-1971 written by the plaintiff intimating the loss to the defendant No.1, it has been stated that the shop was set on fire by rioters. The defendant did acknowledge the letter by their letter dated 22-3-1971 (Ext. 6/2). The defendant No.`1 appointed Republican Surveyors. The Surveyors sent a letter dated 23-4-1971 (Ext. 6/3). The Surveyors submitted their report dated 12-5-1971 (Ext.6/4). The plaintiff sent letter (Ext. 6/4). The defendant No. 2 sent reply (Ext. 6/5). It has to be seen whether during the relevant period, or on the date in question, there was civil commotion, uprising, rebellion or revolution, in East Pakistan. The plaint-ft examined Khalil Ahmed as Ext.

6. He has stated that on account of political disturbances the mob attacked their business and set on fire. He has admitted in his cross-examination that the civil commotion and unrest which resulted in this incident was on account of the postponement of the Assembly. He also admitted that usually the mob was damaging and setting the property on fire to harass and harm the Beharis and it was Beharis' properties which were being damaged in those days He has also admitted that by the Beharis means West Pakistanis. He also admitted that in those days, the local Bengali population was damaging and looting and burning the property belonging to the Beharis and West Pakistanis. He has stated; "It is correct that in February and March, 1971 there was civil commotion in Bengla Desh and there was tension between the local Bengalis and other sections of the population known as non-Bengalis. It is correct that on 25th March 1971 the local population were: agitating against the Pakistan army and non-Bengalis. When my shop was brunt the civil commotion was going on in the country." P.W.2 Shakil Ahmed, the plaintiff was stated that "the civil commotion and riot were continuing for about a year or two before this incident took place. Before 25-3-71 the rioting and arson aggravated and it became at a position of rebelling against the established Government." This question has been considered by my brother Saeeduzzaman Siddiqui, J., in Mst. Naila v. The State PLD 1981 Karachi 45 in which my learned brother has come to the conclusion, after giving cogent reasons, which are fully supported by various quotations from the white paper on the crisis in East Pakistan (5-8-1971), that the general conditions prevailing in the then territory of East Pakistan in the year 1971 could not be described as riot or riotous. He further observed that it was undoubtedly an open insurrection or a popular rising by the masses politically motivated and aimed it to change the then political states existing in the country. He also held that the conditions in the then territory of East Pakistan were an armed rebellion aimed at breaking of Pakistan. This decision was followed by my brother Dr. Tanzilur Rehman, J., in Haji Razzak Haji Habib Janoo v. Pakistan (1986 CLC 740). In S.M. Anwar Sethi v South British Insurance Co. Ltd.. Karachi (PLD 1975 Karachi 458), Mr. Mushtaq Ali Kazi, J. (as he then was) held that Court must take judicial notice of the facts which are too well known to require any further proof. These disturbances could well by termed as civil commotion failing within condition No.6 of the endorsement attached to -the policy, I am in respectful agreement with these decisions for the reasons given by thorn in these decisions and as such I am of the opinion that the conditions prevailing in East Pakistan on 3-3-1971 were an armed rebellion aimed at breaking of Pakistan. I would like to add that the word `war' in a policy of insurance includes civil war unless the context makes it clear that a different meaning should be given to the word. There is no such context in the policy now under consideration. I can see no good reason for giving the word "War" a meaning which excludes one type of war. Irish rebellion was held to amount to `war' within the terms of an insurance Policy (Curtis and Sons v. Mathews (1919) 1 K.B. 425) Revolution were held to be "king's enemies' in Secretary of State for War v. Midland Great Railway of Ireland (1923) 2 Lloyd's Law Report

102. Unless a contrary intention appears, the word "war" in an insurance policy will include `civil war' (Pesqueries Secadoros De Macalao de Espana, SA. v. Beer (1949) 1 AER 845= (1949) 82 Lloyd's Law Report 501, 514 per Lord Morton. Under these circumstances, I am of the opinion that the loss in question was caused by an open insurrection or a popular rising by the masses politically motivated and as that risk was expressly excepted by the policy of insurance, the defendant No.1 was not liable. Issue No. 2: The short question involved in this case is, whether the plaintiff is entitled to compensation from defendants 2 and

3. It Will be convenient to refer in the .first place Section. 8 of Civil' Commotion Compensation Fund Ordinance, 1971 (Ordinance XXI of 1971) which was promulgated by the President on 10-8 1971. This Ordinance was published in Gazette of Pakistan, Extraordinary, dated 17-8-1971: "8 Compensation for loss.--There shall be paid out of the Fund in such manner and to such extent as may be prescribed, compensation for any loss suffered in respect of any insured property during the period commencing the 1st day of March 1971, and ending the day specified in this behalf by the Central Government by notification in the official Gazette, due to fire caused by, or any destructive or malicious activities of persons taking part in civil commotion or due to any action taken by any lawful authority for the suppression of civil commotion: Provided that compensation may also be paid out of the Fund for any loss suffered at any time after the expiry of the said period, if the Central Government is satisfied that such loss was suffered due to circumstances not covered by the policy under which it was insured. (2) In this section,:-- (a) "insured property" means any of the following properties on the date of the loss were insured against any loss under an insurance policy, namely:- (i) commercial stocks of raw material and finished goods; (ii) any building or machinery owned by commercial and industrial enterprises and used for commercial and industrial purposes; (iii) any vehicles or vessels used for commercial purposes; and (iv) cash in safe or cash in transit if specifically insured as a specified amount; (b) "loss suffered in respect of insured property" does not include the amount of profits lost or reduced, or wages paid to workmen who were idle or rent paid for premises damaged." The said Ordinance was promulgated with the object of establishing a Fund for the payment of compensation for certain losses suffered during civil commotion and to provide for matters ancillary thereto. The Ordinance was subsequently repealed by Civil Commotion Compensation Fund (Repeal) Ordinance, 1972 (Ordinance No. XXXII of 1972), which was published m the Gazette of Pakistan, Extraordinary, dated 5th August, 1972. It will be convenient to refer to subsection (3) of section 2 of the Ordinance which leads: "2(3). No compensation shall be payable out of the Fund established under the said Ordinance and all moneys paid into the. Fund shall, after payment out of the Fund of the loans and advances obtained under Section 7 of the said Ordinance, be credited to the Federal Consolidated Funds." . A perusal of subsection (3) of section 2 would show that no compensation shall be payable out of the Fund established under the said Ordinance and all moneys paid into the Fund shall, after payment out of the Fund of the loans and advances obtained under section 7 of the said Ordinance, be credited to the Federal Consolidated Fund. This Ordinance does not make any provision with regard to the claims already referred to and pending before the Central Government under. Ordinance No. XXI of 1971. This Ordinance does not authorise any settlement of claim to any person as compensation. The object of subsection (3) of section 2 is plain and unambiguous. The manifest intention of the legislature in promulgating the Ordinance was that no claim was to be paid after date of commencement of this Ordinance to any person under the repealed Ordinance. I accordingly hold that the plaintiff is not entitled to recover compensation/losses suffered by him in the then East Pakistan, in respect of the insured goods from the defendants 2 and

3. The issue is accordingly decided. In view of the conclusions 1 have already reached on issues 1 and 2, it is not necessary to decide issue: No. 3 and 4. 1 hold that the plaintiff is not entitled to any relief. In. the result suit is dismissed but in the circumstances of the case, the parties shall bear their own costs. M.Y.H./K-141/ K Suit dismissed.