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Section 135: Assignment of rights under policy of insurance against fire

Transfer of Property Act • Official Statutory Text & Practice Guide

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Section 134 All 137 Sections of Transfer of Property Act Section 136

Legal Commentary & Landmark Judgments: Section 135

Section 135 provides for the assignment of rights under policies of marine or fire insurance, allowing the assignee in whom the property insured has absolutely vested to sue in his own name.

  • Insurance Policy Assignment: Every assignee, by endorsement or other writing, of a policy of marine insurance or of a policy of insurance against fire, in whom the property in the subject insured shall be absolutely vested at the date of the assignment, shall have transferred to and vested in him all rights of suit as if the contract had been made with himself.
  • Right to Sue in Own Name: Assignee sues the insurance company directly without joining the original insured.
  • Subject to Equities: Assignee takes subject to all defenses available to the insurer against the original policyholder.
Key Landmark Precedents:
  • Union of India v. Sri Sarada Mills Ltd., (1972) 2 SCC 877: The Supreme Court authoritatively analyzed Section 135, holding that assignment of an insurance policy transfers full legal standing to the assignee to sue the insurer directly for cargo or fire loss.
  • Economic Transport Organization v. Charan Spinning Mills (P) Ltd., (2010) 4 SCC 114: The Constitution Bench examined insurance subrogation and assignment under Section 135, upholding the right of insurers and assignees to sue carriers in civil and consumer forums.
Courtroom Practice & Strategic Litigation Guidance:

When taking assignment of marine or transit claims, obtain a formal stamped Letter of Subrogation and Special Power of Attorney complying with Section 135 to maintain suit against the insurer.

Section 134 All 137 Sections of Transfer of Property Act Section 136