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PETITIONER: N.R. SRINIVASA IYER

       Vs.

RESPONDENT: NEW INDIA ASSURANCE co., LTD.

DATE OF JUDGMENT22/07/1983

BENCH: DESAI, D.A. BENCH: DESAI, D.A. REDDY, O. CHINNAPPA (J)

CITATION:  1983 AIR  899            1983 SCR  (3) 479  1983 SCC  (3) 458        1983 SCALE  (2)44

ACT:      Contract Act-S.  148 Contract of insurance-When custody of motor car damaged in accident is entrusted to repairer by insured in  accordance with  terms of  insurance policy does the insurer become bailee and repairer ‘sub-bailee’ of motor car?

HEADNOTE:      The appellant’s  motor car, insured with the respondent (‘insurer’) suffered  damage in an accident and was taken to and left  in the  custody  of  a  repairer.  On  receipt  of intimation  of   the  accident,  the  insurer  entered  into correspondence with  the repairer,  accepted the estimate of repair charges  and advised the repairer to proceed with the repairs. The.  motor car  was, however,  destroyed in a fire which occurred  hl the  repairer’s workshop.  The  appellant filed a  suit claiming  from the  insurer the  value of  the motor car  on the footing that the insurer was the bailee of the motor car while it was in the custody of the repairer.      The trial  court upheld the contention of the appellant and decreed  the suit  but, in  appeal, the  High Court  set aside the  decree and  dismissed the  suit on  a ground  not related  to   the  contention   based  on  the  contract  of bailment. In Civil Appeal No, 142 of 1965 decided on October 31,1967 this  Court allowed  the appeal of the appellant and remitted the  same to  the High  Court requesting it to deal with the  following questions: (i) whether the insurer was a bailee of  the motor car; (ii) Whether the insurer failed to take as  much care  of the  car  as  a  person  of  ordinary prudence would in similar circumstances; and (iii) The value of the  destroyed car.  1 he High Court held on the basis of the correspondence  between the  parties that  the  car  was entrusted to  the repairer  by the appellant’s son on behalf of the  appellant, that  this was  done without reference to the insurer,  that the  insurer had  only agreed  to pay the repair charges  and that  therefore the  insurer was  not  a bailee of the motor car.      Allowing the appeal, ^      HELD: 1.  A bare  perusal of  some  of  the  conditions contained in  the contract  of insurance  would unmistakably lead to  the conclusion that the insurer was a bailee of the

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motor car.  The custody  of the  repairer was that of a sub- bailee.  The  High  Court  went  wrong  in  not  making  any reference to  the contract of insurance between the parties. In a  contract of  insurance, there  are mutual  rights  and obligations both  of the  insurer and  the insured.  If  the motor car  is damaged  in an accident, a duty is cast on the insured not  to leave  the damaged  car unattended  which of necessity would oblige the insured either to keep a watchman or if the car is in a condition to be moved it ought to be 480 taken  to   a  repairer,   and  the  insurer  undertakes  an obligation to  reimburse the cost of removal to the insured. This would  imply that from the scene of the accident, it is the duty  of the  insurer to  remove the  car to the nearest repairer but  this duty is to be performed by the insured on behalf of  the insurer.  Another important  condition of the contract is  that, once  the car  is damaged in an accident, the insurer may, at its own option, either repair, reinstate or replace the motor car. When the insurer has the option to replace the  motor car, it can take over the damaged car and the insured  is bound  to submit to the same. If the insure, on the  other hand,  exercises the  option of  repairing the car, it  is entitled  not merely  to choose the repairer but also to  determine the  charges for  repairs to  be  settled between the  insurer and  the repairer  and the  insured has hardly anything to do with it. [486A, 487 C-D, 488 C-D]      Moris v.  C. W.  Martin & Sons, Ltd., [1965] 2 All E.R. 725; and  Gilchrist Watt  and Sanderson  Pty  Ltd.  v.  York Products Ltd., [1970] 3 All E. R, 325; referred to.      In the  instant case,  when the  appellant’s  son  soon after the  accident took  the damaged  car  to  the  nearest repairer, the  car virtually  came into  the custody  of the insurer and  the repairer took the custody for and on behalf of the  insurer. The  obligation to get the car repaired was that of  the insurer. The insurer formally took the car into its custody  when it  accepted  the  repairer  to  whom  the custody was  given and  entered into  negotiations about the repair charges  and finally agreed to pay the repair charges to the repairer. [487 E]      As a condition of contract of insurance the insurer has to take  custody of the damaged car, reserving the option to repair or  replace if.  The insured has to remove the car to the nearest  repairer  on  behalf  of  the  insurer  and  is entitled to  be reimbursed  the cost  of removal. Therefore, from the  time of accident, under the contract of insurance, the insurer  would be the bailee. If the option to repair is exercised  and  the  repairer  is  approved  and  paid,  the repairer becomes the sub-bailee. [490 E-G]      2. When  the car  was in the custody of the sub-bailee, it was  destroyed by  fire that  occurred in  the repairer’s workshop. The  sub-bailee was bound to take the same care as a man  of ordinary  prudence would take in regard to his own goods of  the same  quality and value as was expected of the bailee. When the custody is of the bailee or the sub-bailee, the burden  is on  them to show how they handled the car. In the instant  case the  High Court  did not  touch upon  this aspect while  reversing the  decision of  the  trial  court. There is  no evidence  on behalf  of the  insurer as to what amount of care had been taken by the repairer. The appellant has led  some evidence  in this  behalf as  to the  careless manner in  which the  car was  kept in  the  workshop  where inflammable material  was kept.  The  burden  being  on  the bailee and  the sub-bailee  and the  same  having  not  been discharged, the  trial judge  was justified in accepting the evidence of  the appellant and in according the finding that

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the bailee and sub-bailee had not taken such care of the car as was expected of a prudent man in respect of his own goods of the  same quality  and value.  Therefore, the  bailee  is liable for the loss suffered by the appellant, the bailer. 481

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 2202 of 1969.      Appeal by  Special leave  from the  Judgment and  order dated the 2nd January, 1969 of the Kerala High Court in A.S. No. 838 of 1958.      G.B. Pai,  D.N. Misra,  O.C.  Mathur  and  Miss.  Meera Mathur for the Appellant.      N. Sudhakaran for Respondent No. 1.      MRK Pillai for the Respondent No. 2.      The Judgment of the Court was delivered by      DESAI, J. Plaintiff whose car was destroyed in fire way back in July 1953 and claimed a paltry sum of Rs. 7,000 from the respondent  (Insurance Company for short) is knocking at the doors  of Courts of Justice since last three decades and mirage of  justice is  still eluding  him, and  in his chase presumably he  must have spent double the amount than prayed for in  the plaint because this is the second round when the matter has reached the apex court.      Plaintiff, who is the appellant was the owner of Austin 16 H.P.  Motor Car,  which he had insured with the original’ first defendant  Vanguard Fire and General Insurance Company Ltd. (’Insurer’  for short)  in respect of accident, loss or damage. The  period covered  by the policy of insurance Ext. P-1 dated  March 4,  1952 was from March 1, 1952 to February 28, 1953.  This car  suffered damage  in an  accident  which occurred on  December 21,  1952. The  car was  taken to  car repairing workshop  of P.S.N.  Motors Ltd., Trichur and left there and  an intimation  of the  accident was  sent to  the Insurer requesting  it to discharge its obligation under the policy of insurance. The repairer to whom the car was handed over prepared  an estimate  of the  repair  charges  in  the amount of  Rs. 2010  and forwarded  the same to the Insurer. After some  protracted correspondence,  the Insurer accepted the estimate of repair charges in the amount of Rs. 1910 and the Insurer  by its  letter dated  Ext. P-13 dated March 25, 1953 wrote to the plaintiff and the repairer as under:           We have  pleasure  to  inform  you  that  the      revised  estimate   of  M/s  P.S.N.  Motors  Ltd.,      Trichur has been 482      approved by  our head  office, and  they have been      advised to  proceed with  the repairs  and send us      their  final  bill  together  with  the  discharge      voucher duly  filled in  and signed  by  you,  for      making the payment.           Assuring you of our best services always." Since the date of the accident the car was in the custody of the repairer for the purpose of repairs. On July 10, 1953, a fire occurred  in the  workshop of the repairer in which the Motor Car  of the  plaintiff was  destroyed.  The  plaintiff called upon  the Insurer to idemnify him for the loss as per the terms of the policy of insurance alleging that the Motor Car was  in the  possession and custody of M/s P.S.N. Motors Ltd on  behalf of  the Insurer and was being repaired at the sole responsibility of the Insurer under its instruction and since the Insurer had entrusted the Motor Car for repairs to

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a workshop  in which  several automobiles  with  inflammable materials like  oil, petrol,  tyres etc.  were Lying without ascertaining whether  the workshop  was insured against fire and other  risks, the  Insurer was  liable to  make good the loss. The  plaintiff claimed  the value  of the Motor Car on the footing  that the respondent-company was a bailee of the Motor Car  and had  failed to  take such  care thereof  as a person   of    ordinary   prudence   would   under   similar circumstances take  of his  property of the same quality and value as the Motor Car bailed. This last submission alleging a  contract   of  bailment  is  seriously  disputed  by  the respondent-insurance company.      The  Insurer   contested   the   claim,   inter   alia, contending. that  the  suit  is  not  maintainable  in  view Condition No.  7 of the policy of insurance an aspect of the matter which  is concluded  against  the  respondent-company and, therefore,  it is  not necessary  to set out in extenso the contention under this head. The contract of bailment was seriously disputed  and it  was submitted  that the  car was handed over  to the  workshop by the plaintiff’s son and the insurance company had only agreed to re-imburse the loss and the workshop  owner was not the agent of the Insurer nor was the insurance  company a  bailee; nor  could it be said that the agent of the bailee was in possession of the car.      The trial  court held  that the Motor Car was entrusted to the  repairer for  and on  behalf of  the Insurer and the insurance company 483 was liable  for the  loss of  the Motor  Car as  it  was  in possession of  the agent  of the insurance company. The suit was held  to be maintainable, despite condition No. 7 of the policy of  insurance. Accordingly, the suit was decreed with costs.      An appeal  was preferred to the High Court of Kerala at the insurance  of the  Insurer. The  High  Court  held  that condition No.  7 of  the policy  of insurance  precluded the plaintiff from  filing the  suit before  obtaining the award and on  the short  ground allowed  the appeal of the Insurer and dismissed the suit.      The plaintiff preferred Civil Appeal No. 142 of 1965 by special leave to this Court. Shah, J. speaking for the Court in the  judgment rendered  on October 31, 1967 held that the High Court  was in  error in  coming to  the conclusion that condition No.  7 precluded  the plaintiff  from  filing  the suit. This  Court held that condition No. 7 of the policy of insurance has  no operation in the case since the difference between the Insured and Insurer arose not out of the policy; but out of the claim of the plaintiff that the Motor Car was delivered   to    the   respondent-company    for   repairs. Accordingly, this  Court reversed  the decision  of the High Court and  remitted the  appeal to the High Court requesting the High  Court to  deal with  the following questions which arise in the appeal:      "1.  Whether the respondent-Company was a bailee of the           motor car  of the  plaintiff  as  alleged  by  the           plaintiff?      2.   Whether the  respondent-Company failed  to take as           much care of the motor-car as a person of ordinary           prudence would  in similar  circumstances take  of           his own  motor car of the same quality and value ?           and      3.   the value of the motor car destroyed." When the  matter went back to the High Court, the appeal was heard by  a Division  Bench of  the Kerala  High Court.  The Bench hearing  the appeal  had some doubt whether in view of

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the pleading the plaintiff can claim any relief on the basis of a  contract of bailment. After expressing this doubt, the High Court proceeded to observe that in view of the scope of remand the  High Court has to decide the question whether or not the Insurer was a bailee of the plaintiff ? 484 After  referring  to  the  correspondence,  the  High  Court reached the  conclusion that  the Motor Car was entrusted to M/s P.S.N.  Motors Ltd.  by the plaintiff’s son on behalf of the  plaintiff   for  repairs,  that  it  was  done  without reference to  the defendant,  that all  that  the  defendant agreed was to pay to the plaintiff or to P.S.N. Motors Ltd., on his  behalf, the  amount which was settled as the charges for carrying  out all  the repairs."  In this  view  of  the matter, the  High Court  held that  the Insurer  was  not  a bailee of the Motor Car of the plaintiff and the plaintiff’s claim as  founded on  a contract of bailment cannot succeed. The High  Court, accordingly,  allowed  the  appeal  of  the insurance company  and dismissed  the suit  of the plaintiff directing the  parties to bear their respective costs. Hence this appeal by the plaintiff by special leave.      By the  time the  appeal was  filed in  this Court, the General Insurance  Business (Nationalisation)  Act, 1972 was enacted and  brought into  operation. The Central Government in exercise  of the powers conferred by sub-sec. (1) of sec. 16 of  Nationalisation  Act  framed  the  scheme  which  was published in  the Gazette  of India  Extraordinary Part  II- Sec. 3 - Sub-section (ii) . . . dated December 31, 1973. The First Schedule  appended to  the scheme  shows that Vanguard Insurance Company Limited has been merged with the New India Assurance Company  Ltd. It  may be  noticed that the name of the first  respondent is  shown to  be the  Vanguard Fire  & General Insurance  Co. Ltd. It is not made clear whether the Vanguard Insurance Co. Ltd. set out in the First Schedule to the scheme  is the  same as  the respondent  in this appeal. That question  is kept  open to be debated if the obligation to pay  the plaintiff  under  the  policy  of  insurance  is decreed in favour of the plaintiff by us.      Since the  High Court  had to  decide the appeal within the scope  of order  of remand  made by  this Court,  it  is necessary to  confine attention  only to the questions which this Court  directed the  High Court  to determine.  We have already extracted  the three  questions framed by this Court in its judgment rendered on October 31, 1967.      The first  question is whether the respondent-insurance Company was  a bailee  of the  Motor Car of the plaintiff as alleged by the plaintiff ?      Section 148  of  the  Indian  Contract  Act  defines  a contract of bailment as under : 485           "A ‘bailment’  is the  delivery of  goods  by  one      person to  another for  some purpose,  upon a  contract      that they  shall, when  the purpose is accomplished, be      returned or  otherwise disposed  of  according  to  the      directions of the person delivering them. The person to      whom they are delivered is called the "bailee"." There is  an  explanation  appended  to  the  section  which provides that if a person already in possession of the goods of another  contracts to  hold them  as a bailee, he thereby becomes the bailee, and the owner becomes the bailer of such goods, although  they may  not have been delivered by way of bailment. Sec.  149 provides that the delivery to the bailee may be  made by  doing anything  which  has  the  effect  of putting the  goods in  the possession of the intended bailee or of any person authorised to hold them on his behalf. Sec.

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150 prescribes  bailer’s duty  to  disclose  to  the  bailee faults in  the goods  bailed. Sec.  151 provides that in all cases of  bailment the  bailee is bound to take as much care of the  goods bailed  to him  as a  man of ordinary prudence would, under similar circumstances, take of his own goods of the same bulk, quality and value as the goods bailed.      The High  Court came to the conclusion that it is clear from the correspondence between the parties ending with Ext. P-13 that  the car  was  entrusted  to  P.S.N.  Motors  Ltd. Trichur by  the plaintiff’s  son on  behalf of the plaintiff for the  repairs and  that it  was done without reference to the insurance  Company and  that  all  that  the  defendent- insurance Company  agreed was  to pay to the plaintiff or to P.S.N Motors  Ltd. on  his  behalf,  the  amount  which  was settled as  the charges  for carrying  out all  the repairs. Approaching the  matter from this angle, the High Court held that the  Insurer was  not a bailee of the Motor Car and the plaintiff cannot  succeed in  his  claim  as  founded  on  a contract of  bailment. This  conclusion is  not borne out by the record and is against the weight of evidence.      The High  Court did not make any reference to the terms of the  contract of  insurance between  the  parties  before rejecting the  plaintiff’s case  that the  Insurer  was  the bailee and  the repairer  was the sub-bailee who had custody of the  Motor Car  on the entrustment of the custody for the avowed object of repair by the bailee to the sub-bailee. For us, it  is a  bit surprising that the High Court should have rejected the plaintiff’s case out of hand without slightest 486 reference to  the contract  of insurance  evidenced  by  the policy Ext.  P-1. A  bare perusal  of some of its conditions would unmistakably  lead to  the conclusion that the Insurer was a bailee of the Motor Car in question.      The first  condition which  is the  usual condition  in such a  contract is  that the  contract of  insurance  is  a contract of indemnity and the Insurer undertake to indemnify the Insurer  against loss  of or  damage to  the  Motor  Car and/or its accessories whilst thereon by accidental external means. The  next important condition is that in the event of the Motor  Car being  disabled by  reason of  loss or damage covered under the policy of insurance, the Insurer will bear the reasonable cost of protection and removal to the nearest repairers and of redelivery to the insured but not exceeding in all  Rs. 150  in respect  of any  one accident. One other condition worth noting reads as under:           "The insured may authorise the repair of the Motor      Car necessitated by damage for which the Company may be      liable under this Policy provided that:           (a)  the estimated  cost of  such repair  does not                exceed Rs. 300           (b)  the Company  is furnished  forthwith  with  a                detailed estimate of the cost and           (c)  the Insured  shall  give  the  Company  every                assistance  to   see  that   such  repair  is                necessary and the charge reasonable." The next  condition  to  which  reference  may  be  made  is condition No. 4 which reads as under:           "Notice shall  be given  in writing to the company      immediately upon the occurrence of any accident or loss      or damage  and in the event of any claim and thereafter      the  Insured   shall  give  all  such  information  and      assistance as the Company shall require." A further  condition is  that ’the  Company may  at its  own option repair,  reinstate or  replace the  Motor Car or part thereof and/or its accessories or may pay in cash the amount

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of the loss or damage 487 and the liability of the Company shall not exceed the actual value....’ There  is the  further  condition  which  may  be noticed. ’In  the event  of any  accident or  breakdown  the Motor Car  shall  not  be  left  unattended  without  proper precautions being  taken to  prevent further  damage or loss and if  the Motor Car be driven before the necessary repairs are effected  any extension  of the  damage or  any  further damage to  the Motor  Car shall be entirely at the Insured’s own risk.’      We are constrained to reproduce all these very relevant conditions which  have a  tell tale  effect on  the question whether the  Insurer was the bailee of the Motor Car because the High Court wholly ignored them.      In a contract of insurance, there are mutual rights and obligations both  of the  Insurer and  the Insured.  If  the Motor Car  is damaged  in an accident, a duty is cast on the Insured not  to leave  the damaged  car unattended  which of necessity would oblige the Insured either to keep a watchman or if  the car  is in a condition to be moved it ought to be taken to a repairer. From the scene of accident when the car is taken  to the nearest repairer, the Insurer undertakes an obligation to  reimburse the cost of removal to the Insured. This would  imply that from the scene of accident, it is the duty of  the Insurer  to  remove  the  car  to  the  nearest repairer but  this duty is to be performed by the Insured on behalf of  the Insurer  and the  Insured is  entitled to  be reimbursed for  the expenses  incurred by him. Therefore, it was obligatory  upon the  Insured to  remove the  car to the nearest repairer.  This obligation  arose under the contract of insurance.  The High Court rejected the contention of the plaintiff that  the Insurer was a bailee on the short ground that  the   car  was   entrusted  to  the  repairer  by  the plaintiff’s son  on behalf  of the  plaintiff for repair and that it  was done  without reference to the Insurer and that all that the defendant agreed was to pay the plaintiff or to P.S.N. Motors  Ltd. On  his  behalf  the  amount  which  was settled as  the charges  for carrying  out all  the repairs. When the  plaintiff’s son  soon after  the accident took the damaged car  to the  nearest  repairer,  the  plaintiff  was discharging an  obligation under  the contract of insurance, for and  on behalf  of the  Insured because  he  could  have legitimately claimed  the cost  of removal not exceeding Rs. 150 from the Insurer. This would imply that the Insurer took charge of the damaged car from the scene of accident and got it moved  to the  nearest repairer.  The car  virtually came into the  custody of  the Insurer  and the repairer took the custody for and on 488 behalf of  the Insurer.  The material aspect has been wholly overlooked by the High Court.      Secondly, the  High Court  observed  that  the  Insurer merely agreed  to pay  to the  plaintiff-Insurered or to the repairer on  his behalf  the amount which was settled as the charges for  carrying out  all the  repairers. At this stage High Court  overlooked another  important condition  of  the contract of  insurance which has been extracted hereinabove. The Insurer  may  at  its  own  option  either  can  repair, reinstate or replace the Motor Car, once the car was damaged in accident.  The obligation to repair the damaged car arose under the contract of insurance. The Insurer had an absolute discretion either  to repair, reinstate or replace the Motor Car. When  the Insurer  has the  option to replace the Motor Car, it  can take  over the  damaged car  and the Insured is

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bound to  submit to  the same.  If the  Insurer on the other hand, exercised  the option  of repairing  the  car,  it  is entitled not  merely to  choose the  repairer  but  also  to determine the  charges for  repairs  to  be  negotiated  and settled between the Insurer and the repairer and the Insured has  hardly  anything  to  do  with  it.  When  these  three conditions are read together and the evidence is appreciated the inescapable  outcome is  that the  plaintiff through his son sent  the Motor  Car soon  after  the  accident  to  the nearest repairer  in discharge  of an  obligation under  the contract of  insurance and that too for and on behalf of the Insurer. In  this state  of unimpeachable  evidence emanates from the  binding contract  between the  parties,  the  High Court was  clearly in  error in holding that the plaintiff’s son took the car to workshop on his own without reference to Insurer. The Insurer decided to get the car repaired and not to reinstate  or replace  the  car.  Having  exercised  this option, the  Insurer  entered  into  negotiations  with  the repairer and between them by Ext. P-13 worked out the rights and obligations.  The obligation to pay repair charges arose out  of  contract  of  insurance.  The  Insurer  wanted  the repairer to  repair the car and recover the charges from the Insurer. The custody of the repairer would be that of a sub- bailee because  the Insurer  was the  bailee as  pointed out earlier from  the time  of accident. Since the accident, the Insured dealt  with vehicle  strictly as  provided under the contract of  insurance and  that necessitated taking the car to the  nearest repairer  for and  on behalf of the Insurer. The Insurer became the bailee and the repairer may have been initially pointed  out by  the  bailer  but  with  whom  the Insurer entered negotiation arrived at a contract and agreed to get the car repaired in discharge of an obli- 489 gation under  the contract of insurance. Therefore, for this additional reason  the custody  of the repairer is that of a sub-bailee.      A reference  to some  decisions in  this context  would bear out  the conclusion.  In Morris  v. C.W.  Martin & Sons Ltd.(1) plaintiff  sent her  mink stole  to  a  furrier  for cleaning. The  furrier, contracting  as principal not agent, arranged  with   the  defendants   for  them  to  clean  the plaintiff’s fur  on the  current trade  conditions, of which the furrier  knew. The defendants knew that the fur belonged to a  customer of  the furrier,  but did not know to whom it belonged. M,  an employee  of the  defendants, was given the task of  cleaning the fur. While the fur was in M’s custody, he stole  it. The plaintiff sued the defendants for damages. The suit  was dismissed.  In an appeal by the plaintiff, the Court of  Appeal  reversed  the  decision  and  decreed  the plaintiff’s suit.  Lord Denning  quoted  with  approval  the following passage from Pollock and Wright on Possession:           "If  the   bailee  of  a  thing  sub-bails  it  by      authority ....  and  there  is  no  direct  privity  of      contract between  the third  person and  the  owner  it      would seem  that both  the owner  and the  first bailee      have concurrently  the rights  of a  bailer against the      third person  according  to  the  nature  of  the  sub-      bailment." It was  accordingly held  that if  the sub-bailment  is  for reward, the sub-bailee owes to the owner all the duties of a bailee for  reward, and  the owner  can sue  the  sub-bailee direct for  loss of  or damages  to the  goods; and the sub- bailee is liable unless he can prove that the loss or damage occurred without his fault or that by his servant.      In Gilchrist Watt & Sanderson Pty Ltd. v. York Products

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Pty Ltd.(1);  the Shipowners  carried two  cases of  clocks, belonging to  the plaintiffs in their vessel from Hamburg to Sydeny, where  the defendants  carried on  the  business  of stevedores and  ship’s agents.  The bill of lading provided, inter alia,: "When the goods are discharged from the vessel, they shall  be at their own risk and expense; such discharge shall constitute  complete delivery  and  performance  under this contract  and the  shipowners shall  be freed  from any further responsibility".  The defendants  unloaded  the  two cases from 490 the vessel.  When the  plaintiff sought  to take delivery of the  two  cases,  one  of  them  was  missing  and  was  not recovered. The  plaintiffs sued the defendants on the ground that  they   were  sub-bailee  and  are  answerable  to  the plaintiffs to  the same  extent as  the  bailee.  The  Privy Council affirming  the decision  in Morris’s  case held that the bailment to the shipowners continued till the goods were delivered to  the plaintiff, but in the meantime there was a sub-bailment from  the shipowners  to  the  defendants.  The defendants as  sub-bailee were  given and took possession of the  goods  for  the  purpose  of  looking  after  them  and delivering them  to the  holders of  the bill  of lading who were the  plaintiffs, thereby  the defendants  took on  this obligation from  the plaintiff  to exercise due care for the safety of  the goods,  although  there  was  no  contractual relations between  the plaintiffs  and the  defendants.  For this proposition  Morris’s case was held to be the principal authority and it was virtually followed.      It is not necessary to multiply the decisions further.      Turning to  the facts  of  this  case  as  pointed  out earlier, the  contract of  insurance  as  evidenced  by  the insurance policy  clearly spelt-out a duty and an obligation to remove  the damaged  car covered  by the  policy  to  the nearest repairer  as soon as the accident occurred. This was an obligation  cast on  the Insured  to be  carried  out  on behalf of  the Insurer,  and this  was to  be done  for  the benefit of the Insurer because the Insurer had the option to repair or  to replace  the car.  In the  background of these facts, the  handing over  of the car by son of the plaintiff to the repairer would constitute a delivery on behalf of the Insurer who  would be  the bailee  and the repairer would be the sub-bailee.  This inference  is further  strengthened by the correspondence  that ensued  between the Insurer and the repairer. The  obligation to get the car repaired was of the Insurer. It had a right to take the car into its custody. It did formally  take the car into the custody when it expected the repairer  to whom  the custody  was  given  as  the  one acceptable to  them and  entered into negotiations about the repair charges  and finally agreed to pay the repair charges to the  repairer. Unquestionably,  the Insurer  would be the bailee and the repairer would be the sub bailee.      The second  point which  this Court  directed the  High Court to decide was whether the respondent-company failed to take as  much care  of the Motor Car as a person of ordinary prudence would 491 in similar  circumstances take  of his  own Motor Car of the same quality  and value?  When the car was in the custody of the sub-bailee,  it was  destroyed by  fire that occurred in the repairer’s  workshop. The  sub-bailee was  bound to take the same  care as  a man  of ordinary prudence would take in regard to his own goods of the same quality and value as was expected of  the bailee. Now no evidence has been led by the defendants to  explain what amount of care the bailee or the

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sub-bailee took  in respect  of the car. When the custody is of the  bailee or  the sub-bailee,  the burden is on them to show how  they handled the car. This is well-established and need no  authority. In Morris’s case, the question of burden of proof was examined by the Court of Appeal and the law was stated as under:           "Once a  man has taken charge of goods as a bailee      for reward,  it is  his duty to take reasonable care to      keep them  safe; and  he cannot  escape  that  duty  by      delegating it  to his servant. If the goods are lost or      damaged, whilst  they are  in  his  possession,  he  is      liable unless  he can  show-and the burden is on him to      show-that the  loss  or  damage  occurred  without  any      neglect or  default or  misconduct of himself or of any      of the servants to whom he delegated his duty."      In the  present case,  the trial  Court held  that  the repairer the  sub-bailee failed  to take that much care as a prudent man  would take  of his  own thing in respect of the car. The  High Court  has  not  touched  this  aspect  while reversing the  decision of  the trial  Court.  There  is  no evidence on behalf of the Insurer on the question as to what amount of  care has  been taken  by the  repairer  the  sub- bailee. One  R. Rajaram D.W. 1 was examined on behalf of the Insurer, and  there is  not one  word in his examination-in- chief as to what degree of care was taken to keep the car in safe custody  by the  sub-bailee. No  one  was  examined  on behalf  of  the  sub-bailee.  The  burden  was  on  them  to establish to the satisfaction of the Court as to what degree of care  was taken  in respect of the damaged car. Plaintiff has led  some evidence  in this  behalf as  to the  careless manner in  which the  car was  kept in  the  workshop  where inflammable material  was kept.  Without  doubt  the  burden being on  the bailee  and the sub-bailee and the same having not been  discharged, the  learned trial Judge was perfectly justified in  accepting the evidence of the plaintiff and in recording the finding that bailee and the 492 sub-bailee had  not taken  such  care  of  the  car  as  was expected of  the prudent  man in respect of his own goods of the same  quality and value. Therefore, the bailee is liable for the loss suffered by the plaintiff the bailer.      The last point which this Court directed the High Court to determine  was about  the value of the destroyed car. The plaintiff has  given the  value of the Motor Car at the time of its  loss at  Rs. 7,000,  and that  is the measure of the loss suffered by the plaintiff on account of the loss of the car. The  trial Court  had decreed  plaintiff’s suit  to the extent of Rs. 7,000. The finding is confirmed.      For the  reasons herein  mentioned,  this  appeal  must succeed and  it is  accordingly allowed.  The  Judgment  and decree of the High Court are set aside and the one passed by the trial Court is restored with costs throughout. H.L.C.                                      Appeal allowed. 493