1. ' SYED HAIDER ALI PIRZADA, J.---These three appeals by Pakistan Insurance Corporation/the Insurer, are directed against composite judgment/decree dated 1-12-1987 passed by the learned Single Judge of this Court, dismissing the suits filed by the appellant.
2. ' The case of the appellant, in brief, is that the importers in the suits being Nos. 118 of 1969, 218 of 1969 and 195 of 1974 imported their consignments under bills of lading issued by the respondents/Shipping Companies or their agents on board the vessels owned by the respective respondents. The consignments were insured with the National Co-Insurance Scheme (hereinafter called the Scheme"). The importers filed their claims with the said Insurer with respect to the loss of their consignments, which was settled by the said Insurer and after getting letters of subrogation, the plaintiffs/appellants filed the above suits for the recovery of the same from the defendants/respondents.
3. ' The above suits have been filed by the Pakistan Insurance Corporation, which was established under the Pakistan Insurance Corporation Act, 1952 (hereinafter referred to as the 'said Act'). The case of the appellant, as set out in the memo of appeals, is that during the early days of Pakistan, it was felt that bulk of insurance business was underwritten by foreign insurance companies and in order to save foreign exchange, to economise Government expenditure and to patronize the National Insurance Industry, the Government Departments were advised in the year 1952 that the insurance of Government goods should, as far as possible, be placed with the National Insurance Corporation.
4. ' In the year 1955, a consortium of five insurance companies namely (1) Eastern Federal Union Insurance Company Ltd., (2) Habib Insurance Company Ltd., (3) Premier Insurance Company Ltd.,
(4) New Jubilee Insurance Company Ltd., and (5) Alpha Insurance Company Ltd. Was formed. This was known as National. Co-Insurance Scheme. It may be added that new National Companies will be entitled to be admitted to the said consortium or Scheme as and when they meet the necessary criteria of sound management and security. The Government of Pakistan, by their office Memorandum dated 7th April, 1955, entrusted the administrative work of the Scheme to the appellant. The Government Departments were directed to address the Pakistan Insurance Corporation as Secretaries to National Co-Insurance Scheme. .
5. ' The following preliminary issue was framed in the above suits:--- "Whether the plaintiffs have right to sue?"
6. ' By consent of the parties, the above legal/preliminary issue was decided. The parties did not lead any evidence in support of their respective contentions.
7. ' The learned Single Judge held that while issuing policies or settling claims against such policies as Secretaries of the said Scheme, the plaintiff acted as agent and did not acquire any right to file any suit to enforce the claim of the said National Co-Insurance Scheme. In that view of the matter, the learned Single Judge held that the plaintiff is not entitled to any decree against the defendants as under section 230 of the Contract Act, they, as agents, cannot enforce any right that which was secured to their principals viz. National Co-Insurance Scheme. Accordingly the suits were dismissed.
8. ' In Messrs Pakistan Insurance Corporation v. Messrs Pan-Islamic Steamship Co. Ltd. And another 1988 CLC 1373, Mr. Ajmal Mian, J. (now Judge Supreme Court), inter alia, after referring to the provisions of the Act and National Co-Insurance Scheme Regulations, 1970, held that the Pakistan Insurance Corporation has no right to sue in respect of right of subrogation arising out of any insurance policy issued by the Scheme. He held that the Corporation is not competent to sue the defendants. In that view of the matter, suits were dismissed as being incompetent.
9. ' In M/s. Pakistan Insurance Corporation v. Pakistan Shipping Lines Ltd., Karachi PLD 1991 Kar. 271, a learned Single Judge of this Court, after following the decision in the above case, held that the plaintiff at the most acted as agent for the companies, who were members of the National Co- Insurance Scheme and, therefore, they would not be competent to file the suit in their own name. In this view of the matter, he dismissed the suit.
10. ' Mr. A.R. Siddiqui, learned counsel referred to the background of framing the Scheme and submitted that ordinarily the Scheme was framed on the basis of office memorandum or administrative order of the Federal Government with the object to save the foreign exchange and to promote in Pakistan the insurance business but subsequently in 1967 the Scheme was given the cover under the Act.
11. ' Section 22 of the Act says that the Corporation is to transact what kinds of business. Clause (bbb) of section 22 provides that arrangement and management, on such conditions as the Central Government may impose, of the general insurance and statutory corporation.
12. ' Clause (aa) of section 22 says "conducting, subject to the direction of the Central Government and rules made in this behalf, the business relating to any scheme.
13. ' Section 2(g) of the Act defines the Scheme as under:--- "Scheme" means any Export Credits Guarantee Scheme prepared by the Central Government, the principal object of which is to give credit guarantees for the purpose of any business connected with the export of goods from Pakistan or any manufacture, treatment or distribution of goods, or rendering of services or other matters conducive to the export trade of Pakistan."
14. ' It may be pertinent to point out that the National Insurance Fund Rules, 1973 were framed by the Federal Government and these rules came into force with effect from 1st July 1973. Rule 2(c) defines the word 'Fund'. It means "the National Insurance Fund established by the Government of Pakistan on the 1st July, 1973;" Rule 3 is regarding Winding-up Scheme. It says as under:--- "On the commencement of these rules, the arrangement and management of the general insurance business of the Government and statutory corporations with the Scheme shall cease and it shall be wound up in such manner as may be decided by the Board."
15. ' In 1970, in exercise of the powers under section 46 of the Act, the Board of Directors of Pakistan Insurance Corporation, with the previous approval of the Central Government made the National Co-Insurance Scheme Regulation, 1970.
16. ' The objects of the Scheme are given in Regulation No,3 which read as follows:--- "3. Objects: The objects of the Scheme shall be---
(a) To bring on the portfolio of the Scheme all Fire, Marine, Miscellaneous, Accident, Marine and Aviation (Hull), Bid and Performance Bond, Contractor's All Risks, Erection and Machinery Breakdown etc. i,e, all classes of general insurance business:
(i) Emanating from all Government Ministries, Departments, Statutory Corporations and any other Bodies and Institutions under the Control of the Central and Provincial Governments, as may be determined by the Management Committee.
(ii) and such other business as may be allocated to the Scheme by the Central Government.
(b) To enter into reinsurance agreements with the Corporation as the Management Committee may deem necessary in respect of business falling under purview of the Scheme.
(c) To decide and take action in matters affecting the common interest and welfare of the members in respect of business falling within the scope of the Scheme.
(d) To unite in the Scheme the Pakistani Insurance Companies registered and incorporated in Pakistan, which are members .Of the Insurance Association of Pakistan and eligible to be or to continue to remain members of the Scheme.
(e) To take other actions, including training of employees, for the benefit and growth on healthy and sound lines of the general insurance business in Pakistan"
17. ' Regulation 6 deals with the eligibility of membership and, inter alia, provides that every Pakistan Insurance Company registered and incorporated in Pakistan being a member of the Insurance Association of Pakistan will be eligible for the membership of the Scheme. Regulation 8 contemplates the distribution of the business of the Scheme amongst its members as may be approved by the Central Government from time to time on the advice of the Management Committee of the Scheme which is constituted in terms of Regulations 9,10 and 11 for running of the Scheme. Regulation 14 provides for constitution of a Claims Committee for settlement of claims.
18. Regulation 16 provides for remuneration to the Corporation to be paid to it as may be determined by the Managing Committee for operating the Scheme. Regulation 18 provides for preparation of an annual budget of the Scheme. Regulation 27 provides that the Scheme shall not be wound up except at the instance of the Corporation with the prior approval of the Central Government and in the event in such form or manner as may be determined by Corporation with the approval of the Central Government.
19. ' The relevant clauses 19 and 20 of the National Co-Insurance Scheme Regulation, 1970 which relate to the functions and responsibilities of the appellant/plaintiff are reproduced as under:--- "(19) Responsibilities of the Corporation.
(a) Cover is provided immediately at reasonable rates.
(b) Losses are settled expeditiously.
(c) Maximum possible foreign exchange is saved in respect of business falling within the Scheme.
20. The Corporation shall--
(a) Issue cover notes and policies on behalf of the members.
(b) Settle all claims, including disposal of salvage on behalf of the members.
(c) Be responsible for the regular collection of premium in respect of the business underwritten by the scheme.
(d) Incur expenditure for running the Scheme on behalf of the members.
(e) Maintain proper accounts and render such quarterly statements of accounts to the members as may tie decided by the management committee from time to time."
20. ' It is not in dispute that National Co-Insurance Scheme is consortium of a number of insurance companies formulated under administrative directions of the Central Government for the purpose of the insurance of the goods imported or exported from Pakistan. Initially this consortium consisted of three insurance companies, but subsequently the number of insurance companies was increased to twenty-four. The names of these insurance companies and their respective shares are shown in the insurance policy in Suit No,118 of 1969 (ICA No,21 of 1988) which is produced as Exh.4/1.
21. ' It is an admitted position that the plaintiff/appellant's name does not appear in the list of the insurance companies who constituted this consortium. Admittedly, the plaintiff/appellant did not share profit or loss incurred under the Scheme. The plaintiff/appellant, is designated as authorised Secretary of National Co-Insurance Scheme.
22. ' It is advantageous to refer to section 230 of the Contract Act which reads as under:--- "230. In the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
23. ' Such a contract shall be presumed to exist in the following cases:---
(1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad:
(2) where the agent does not disclose the name of his principal: (3) where the principal, though disclosed, cannot be sued."
24. ' The general rule laid down in this section is that an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them. But conversely, the rule is that the principal is exclusively entitled to sue and he is the only person who may be sued. But, the above rule applies only in the absence of any contract to the contrary.
25. ' It is clear from the provisions of section 230 that the Corporation is not competent to sue on the basis of covers/insurance policies issued by the companies who were members of the Scheme. In our opinion, the learned Single Judge has rightly come to the conclusion that the Corporation is not competent to sue the respondents.
26. ' Considering all these facts and circumstances, the judgments and decrees passed by the learned Single Judge appear to us as unassailable. We, therefore, dismiss the appeals and affirm the judgments and decrees of the learned Single Judge. There will be no order as to costs.