P L D 1960 Dacca 885 (PLP)

" The said goods, to be carried and delivered, subject to the terms and conditions of the Bill of lading in the like good order and condition at the Port of Chittagong unto self or his or their assigns. The special endorsements on the bill of lading were to the follow ing effect:‑-- " Ship not responsible for number of pieces in bundles. Some Bales covers torn and resewn. Ship not responsible for condition of bags. Weight and contents. Bales tied with hoops, Ship not responsible for damage arising from rusty hoops. Ship not responsible for bursting of Bands and/or correct delivery by marks and numbers." The learned Judge accordingly held that the shippers were bound by these statements in the bill of lading and since they had neither proved that the goods were delivered in the same condition in which they were said to have been received according to the endorsement in the bill of lading they were liable to make good the loss or damage and the tally slips Exh. 2 series were not accepted by the Court as establishing that the goods were in any different condition than those mentioned in the bill of lading. On the other hand, the Court accepted and relied upon the joint tally slips produced by the Jetty authorities Ext. C series which appear to confirm the nature of the damage reported in the survey report Exh.

7. The learned Judge was also of the view that the shipper's agents were not justified in asking for the bill of lading after receiving the application for survey as they had already a copy of the bill of lading with them. He also accepted the statement of P. W. 3, the surveyor that in this particular case the carrier, namely, the defendant No. 2 had asked him to carry on the survey. Hence, no further intimation of the survey was necessary. The objection taken by the said defendant to survey was, therefore, rejected. The learned Judge was also of the opinion that the suit was not barred by limitation since in the present case the Federation of Pakistan being also a party, notice under section 80 of the Code of Civil Procedure had to be served on the Federation of Pakistan and the period of the notice, namely 60 days could be added on to the period of limitation prescribed for such a suit by reason of the provisions of section 29 of the Limitation Act. The suit was filed within this added period of 60 days and, there fore, it was not barred by limitation. With regard to the contention that the suit could not be maintained by the plaintiff‑firm, as the proforma‑defendant No. 3 had already been subrogated to the rights of the plaintiff‑firm, the learned Subordinate Judge took the view that in spite of the subrogation the plaintiffs were entitled to recover compensation for the loss and damage suffered to their goods for and on behalf of the Insurance company from the carrier, namely, the defendant No.

2. On the evidence the learned Subordinate Judge was also of the view that Exh. C series clearly showed that the damage was not due to any fault or neglect on the part of the Jetty authorities as the goods left the ship's tackle in that condition and, hence, the defendant No. 1 was in no way liable for the loss and damage claimed in the case. The suit accordingly was dismissed against the defendant No. 1 but decreed in full against the defendant No.

2. It is against this decree that the said defendant No. 2 has preferred this appeal. In this appeal we may say straightway that so far as the evidence is concerned, we have no doubt in our minds that the learned Subordinate Judge correctly assessed the said evidence and rightly came to the conclusion that the goods were not consigned in the damaged condition in which they were found at Chittagong port when they left the ship's tackle. The only evidence produced to establish this were the tally slips Exh. E‑2 series. These were, in our opinion, rightly not relied upon, as these were documents produced at the last minute, although they were certainly documents with the control and custody of the defendant 'No. 2 and could have been produced earlier. The register of consignments admitted to be kept by D. W. 2 also was not produced, nor was the tally clerk who was supposed to have maintained Exh. 2 produced to give evidence in this case. It is significant also that the joint tally slips prepared at the Chittagong Port itself Exh. C series of which the defendant No. 2 received carbon copy, according to the admission" of D. W. 2 himself, were also not filed in this case by the said defendant. In these circumstances, there is no evidence to rebut the evidence produced on behalf of the plaintiff firm to show the damaged condition of the cargo and the exact extent of the damage as found by the Surveyor P. W.

3. There is no reason why the said evidence of the plaintiff should not be accepted. So far as the survey is concerned, it has been established upon the documentary evidence that the application for survey was duly received by the defendant No. 2 but the defendant No. 2, on a wholly unjustifiable pretext, attempted to delay the survey, although according to its own case, the survey had to be held at the Jetty within three days of the landing of the cargo as stated in the letter of the defendant No. 2 sent to the plaintiff‑firm on the 28th of November, 1951. . In the circumstances, it was not unreasonable on the part of the plaintiff firm to proceed with tire surve3‑ in order to have the same completed within this time, and the evidence shows that this was done. According to P. W. 2, what actually happened was that he went to the staff of the shipping department of the defendant No. 2 with the Surveyor but no representative of the defendant No. 2 attended the survey. This statement was elicited in cross‑examination on behalf of the defendant No. 2 but the defendant No. 2 did not attempt to rebut this statement by any other evidence called on its behalf. Hence, we also accepted this statement of P. W. 2 that the defendant's staff of the shipping department were requested to attend the survey at the time but they did not do so. Hence in our view, the objection to the survey has also been rightly rejected. If the said defendant, wanted to challenge the correctness of the survey report, the onus was upon it to adduce evidence to show that the survey report was not correct. Since this was not done, we also accept that the survey report correctly represents the damage caused to the plaintiff‑firm's goods. So far as the question of limitation is concerned, it is not seriously pressed before us on behalf of the appellant and we may state that we agree with the view taken by the learned Subordinate Judge that in the present circumstances of the case the suit was not barred by limitation having been filed well within 60 days of the service of the notice under section 80 of the Code of Civil Procedure. The main point urged in support of this appeal is, however, the ground of non‑maintainability of the suit by the plaintiff‑firm on account of the subrogation of the Insurance company to the rights, and interests of the consignee. In this connection the learned Advocate appearing on behalf of the appellant draws our attention to section 135‑A subsections (3) and (4) of the Transfer of Property Act which provide as follows: " Where the insurer pays for a partial loss, he acquires no title to the subject‑matter insured, or such part of it as may remain, but he is thereupon subrogated to all rights and remedies of the insured person as from the time of the casualty causing the loss, in so far as the insured person has been indemnified by such payment for the loss. Nothing in clause (e) of section 6 shall affect the provisions of this section." Clause (e) of section 6 provides that a mere right to sue cannot be transferred. In view of these provisions; it is contended that by this added section 135‑A of the Transfer of Property Act, which was inserted by the Transfer of Property (Amendment) Act (VI of 1944) a special method of assignment of such a right to sue has been provided in favour of the subrogee and hence, wherever an insurer in the circumstances mentioned in subsection (3) is subrogated to all the rights and remedies of the insured person, all the rights and remedies vest in the insurer and the assured is divested of those rights. Hence, he can no longer maintain a suit to enforce his rights and remedies against a third person. In support of this contention; reliance is placed on a decision of the Calcutta High Court in the case of Aliance Co. Ltd. v. The Union of India (62 C W N 539), where the Calcutta High Court held that this section had altered the English law which had hitherto been followed in India also that an insurer who has paid for a total loss of an apportionable part of some goods carried for transit by land by a Railway administration can maintain a suit in his own name against the carrier for reimbursement of the amount paid to the insured for the loss. This is a decision of a Single Judge of the Calcutta High Court and the learned Judge has, by analogy to the provisions of section 92 of the Transfer of Property Act, taken the view that under section 135‑A of the said Act the bar to the insurer suing in his own name has been removed and this section 135‑A has made a deliberate departure from the English rule of procedure which lays down that an insurer who pays for a total loss cannot sue independently in his own name. The learned Advocate also relies on a decision of the Privy Council in the case of Lal Man Mohan Das, Janki Prasad and others (A I R 1945 P C 23), to show us that their Lordships of the Judicial Committee when dealing with section 92 of the Transfer of Property Act indicated that subrogation means "the substitution of one creditor for another", and hence, the subrogee for all purposes stands in the shoes of the insured and after such subrogation the right, title and interest of the insured must be deemed to have passed and vested in the insurer as from the date of the payment by the insurer. So far as the rule in England is concerned/ it is clear that a subrogee cannot maintain a suit for the recovery of damages for which he has indemnified the assured in his own name, although he may sue in the name of the insured himself. Thus, in the case of King v. Victoria Insurance Company Limited (1896 A C 250), Lord Hobhouse in delivering the opinion of the Board took the view that an insurer cannot by mere force of subrogation sue in his own name but what he can do, if necessary, is to use the name of the insured and a Court of Law or Equity would compel the insured to permit his name to be used on the usual terms. In the case of James Nelson & Sons Limited v. Nelson Line (Liverpool) Limited ((1906) 2 K B 217), the Court of Appeal in England pointed out that the right of a subrogee was not that of an assignee of the cause of action and went on to indicate the nature of the right by way of subrogation thus :‑-- " It is the right to stand in the shoes of the persons whom they have indemnified, and to put in force the right of action of those persons ; but it remains the plaintiffs' right of action, although the underwriters are entitled to deduct from any sum recovered the amount to which they have indemnified the plaintiffs, and although they may have provided the means of conducting the action to a termination. It is not a case in which one person is using the name of another merely as a nominal plaintiff for the purpose of bringing an action in which he alone is really interested ; for the plaintiffs here have a real and substantial interest of their` own in the action." Indeed, an interesting instance of this rule is found in the case of Morley v. Moore ((1936) 2 K B 359). This' was a case of a claim for damage to a motor‑car and in this case the insurance company after having settled the claim of the insured, which was slightly less than the amount of the damage sustained, in pursuance of an agreement with the defendant's insurance company, requested the plaintiff not to make any claim against the defendant. Nevertheless the plaintiff brought a suit to recover from the defendant the full amount of the damage. Objection was taken that since the insurer had been subrogated to the right of the plaintiff and since the insurer had also requested the plaintiff not to sue, the suit was not maintainable. The Court of Appeal, however, held that the request of the plaintiff's insurers did not prevent the plaintiff from recovering but that the insured when he recovered this amount, would hold the amount so recovered from the defendant as trustee from the insurer who had been subrogated to his rights to the extent of the amount paid by the insurer. In MacGillivray's Insurance Law, Fourth Edition at paragraph 1686 it is stated that in spite of the subrogation the legal right to compensation remains in the assured, and, therefore, unless there has been an express assignment of the legal right, actions at law brought for the benefit of the insurer are brought in the "name of the assured. Thus, what the subrogee is subrogated to is to receive the benefit of all the rights of the assured against, third party and in effect, the right of subrogation is in the nature of an equitable right or charge upon the assured's chows‑in‑action arising upon payment by the insurance company. In the Courts in West Pakistan a similar view has consistently been taken in several cases. The first is the case of Federation of Pakistan v. The Co‑operative Insurance Society of Pakistan, Ltd., (P L D 1956 Lah. 878). That was a case of a suit brought by the insurer in his own name and the West Pakistan High Court held that the insurer of goods had no right to sue, in that case the Railway, for compensation for the loss even if the insurer had obtained any letter of subrogation from the consigner. The next case is that of Queensland Insurance Co. Ltd. v. British India Steam Navigation Co. Ltd. (P L D 1958 Kar. 389). In this case the decision in 62 C W N 539, which was not reported till then, (Alliance Assurance Co. Ltd. v. The Union of India) was considered as also another decision of the Calcutta High Court in the case of Indian T. & G.

1. Co. Ltd. v. Union of India (A I R 1957 Cal. 193). In this latter case another learned Judge of the Calcutta High Court took the view that subrogation does not entitle the plaintiff to sue in his own name. The next is the case of Queensland Insurance Co. Ltd. v. The Pakistan International Airlines (P L D 1959 Kar. 275). In this case also both the above‑mentioned Indian decisions have been noticed and the same view taken namely, that section 135‑A of the Transfer of Property Act does not empower a person subrogated under that section o sue in his own name by mere virtue of the subrogation. The latest decision of the West Pakistan High Court is in the case of The Co‑operative Insurance Society of Pakistan, Ltd., Lahore v. Federation of Pakistan (P L D 1960 Lah. 332). In this last decision all the English and Indian decisions have been discussed and elaborate reasons given for taking the view that section 135‑A of the Transfer of Property Act by itself does not extinguish the right of the insured to sue in his own name. It has been pointed out in the last mentioned case that there is a marked difference between section 92 and section 135‑A, for section 91 of the Transfer of Property Act specifically provides for the right to sue for redemption and a subrogee thereunder acquires the right to sue because of the right so specifically given. In section 135‑A no specific right has been given. The right to sue does not by operation of law, therefore, devolve upon the subrogee. We are in agreement with the view expressed in the West Pakistan High Court and in the English decisions referred to earlier. Subrogation does not, in our opinion, cause any extinction of the rights of the insured to sue the person liable to make good the loss suffered by him. All that the subrogee might claim in such circumstances is a similar equitable right to sue in the name of the insured if the latter does not take appropriate action. There are some observations in MacGillivray on Insurance Law to the effect that in the Courts of Equity and Admiralty in England the insurer has also been permitted to sue in his own name. But the learned author is also clearly of the view that the insured's right to sue is not extinguished by reason of this subrogation. Even if this principle be accepted, the suit by the insured cannot be said to be non‑maintainable. We are unable to accept the view expressed in 62 C W N 539 that the law relating to the rights of a subrogee in India and Pakistan has undergone a change by reason of the introduction of section 135‑A in the Transfer of Property Act. The analogy drawn on the basis of the provisions of section 92 of the said Act is not an apt analogy for the provisions of section 91 which expressly confer the right on the subrogee to sue have been overlooked in the said case. The said decision does not also notice that section 130 of the same Act prescribes the manner of the transfer of an actionable claim, expressly "vests" the rights and remedies of the transferor in the transferee and subsection (2) of the said section again makes an express conferment of the right to sue upon the transferee. Section 135‑A of the said Act however, neither vests any rights in the subrogee nor does it give him any such express right to sue in his own name. This marked difference in the language is not without significance. It rather seems to indicate that the subrogee under section 135‑A was not intended by the Legislature to be given any higher or different rights than those which he already possessed under the law from which the term was borrowed. For the reasons we have given above, we are of the opinion that this appeal has no merits. The appeal is accordingly dismissed with costs. SATTAR, J.‑I agree. A.H. Appeal dismissed.