Rulings on Insurance Law by Supreme Court in Bangladesh

April 13, 2015 in Publication

Lawyers Bangladesh decided to publish some important and landmarks rulings on specific issues and in view of that its our pleasure to publish decisions on Insurance Law of Bangladesh.

Decisions on Insurance Act 1938

1.     Sections 2(13d) & 46 of Insurance Act 1938; the doctrine of privity in case of a contract of insurance with the intervention of a bank through documentary credits gets always modified. The effect of the doctrine of privity of contract stands modified by section 46 read with section 3(13D) of the Insurance Act.

 Janata Insurance Co. Vs Islam Steel Mills 52 DLR 642.

2.     Section 44A(1)—This provision sets a pre-condition of a survey report for payment of claim in respect of general insurance. It does not provide that any legal proceeding will be batted unless the loss is surveyed by an insurance surveyor.

Sadharan Bima Corporation vs The Dhaka Dyeing and Manufacturing Company Ltd. 43 DLR 286.

3.     Section 46—Section 46 of the Act empowers a holder of policy to sue for any relief in respect of the policy in any Court of competent jurisdiction in Bangladesh; if the suit is brought in Bangladesh any question of law arising in connection with any such policy shall be determined according to the law in force in Bangladesh. But such right is given only to the holder of a policy and an insurer cannot claim such right to go to a civil Court.

Homeland life vs Jahanara Begum and others 52 DLR 666.

 

4.      Section 47B –Arbitrator  could not have awarded interest to the appellant because the  Arbitrator was to determine the quantum of loss or damages and nothing else—He had no authority to direct the payment of the sward—The question of awarding the interest was outside his term of reference—The award of the arbitrator is not yet complete in the sense that it is still the subject-matter of appeals—Payment on the policies becomes due when the award reaches a finality and from this point of time 90 days shall start to run and the question of payment of interest under section 47B arises.

Daulatpur Traders & Co Ltd vs The Eastern Federal Union Insurance Co Ltd 42 DLR  125.

5.       Section 47—B Section 47B of the Insurance Act 1938 as amender by Ordinance XXV of 1970 provides for granting of interest on claims. This provision displaces the discretion of the Court conferred by section 34 of the Code of civil Procedure in the matter of granting interest. Hence the plaintiff-appellant is entitled to the statutory interest under section 47B of the Insurance Act. The Court has no discretion in the matter.

Chalna Marine products Ltd. Bs Reliance Insurance Ltd and others 50 DLR ( AD) 100.

6.      Section 47B—The amended provision of the Insurance Act displaces the discretion of the Court in the matter of granting interest.

Bangladesh General Insurance Co Ltd vs Chalna Marine Products Co Ltd 51 DLR 357.

 

7.       Section 48(1), 48B, 48BB, 102(1) &109—It is only a Magistrate of the First Class to try any offence for breach of any provision of the Act and the respondent has no lawful authority to impose any fine upon the petitioner for breach of any provision of the Act.

National Life Insurance Company Ltd vs Controlled of Insurance 56 DLR 624.

8.        Section 47—B Section 47B of the Insurance Act 1938 as amender by Ordinance XXV of 1970 provides for granting of interest on claims.

Consequently the Court at present has no discretion in the matter of awarding interest earlier available section 34 of the Code of civil Procedure. The claimant is thus entitled to the statutory interest under section 47B of the Insurance Act.

Chalna Marine products Ltd. Bs Reliance Insurance Ltd and others 50 DLR ( AD) 100.

9.        The claim for loss of damage to stock due to deterioration, the plaintiff will also have to prove that there was break down of machinery and the parts, particulars of which must be kept, had to be replaced.

M/s Bangladesh General Insurance Co Ltd vs M/s Meghna Sea Foods Ltd. 21 BLD (HCD) 430

10.     It being a  beneficial  legislation, a  Court of law is to see to the interest of the  aggrieved person more than that of  the     Insurer,   “Pending action” as contained in Condition No. 19 of the Insurance Policy means not only suit or other legal proceedings before a Court but also means and includes any legal action of claim pending before the authority—Insurance Act, 1938.

Sadharan Bima Corporation Vs. Sanjib Kumar Das and another ,14 BLD (HCD)109