SUPREME COURT LAYS DOWN PRINCIPLES FOR GRANTING COMPENSATION IN MOTOR ACCIDENT CLAIMS

The #SupremeCourt has recently in the matters of U.P. State Road Transport Corporation Vs Rajenderi Devi and Ors. dated 08-06-2020, Chandrakanta Tiwari Vs New India Assurance Company Ltd. and Anr. dated 08-06-2020, Sri Anthony Vs Managing Director, K.S.R.T.C dated 10-06-2020 and M.H. Uma Maheshwari and Ors. vs United India Insurance Co. Ltd. and Anr. dated 12-06-2020, laid down certain principles for allowing #compensation in various #motorvehicleaccident #claim matters.

The Supreme Court made the following observations in each of the above-mentioned cases:

1) In U.P. State Road Transport Corporation Vs Rajenderi Devi and Ors. dated 08-06-2020:

In this case, a 45-year-old man riding a cycle was hit by a bus, as a result of which, he succumbed to his injuries. The bus was a private one, but it operated under the control of Uttar Pradesh State Road Transport Corporation (UPSRTC). The Motor Accident Claims #Tribunal (#MACT) held UPSRTC vicariously liable for paying compensation to the family of the deceased. Thereafter, in an appeal, the High Court upheld the order of the MACT. Thus, the UPSRTC filed an appeal before the Apex Court. The 3-Judge Bench of the Supreme Court observed and held that:

i) That the expression ‘#owner’ under Section 2 (30) of the Motor Vehicles Act 1988 (the Act) has to be interpreted in a manner to include not just the registered owner of the vehicle, but also the person who has the actual possession and control of the motor vehicle, who has the right to hire and fire the employee, and under whose directions and commands the driver operates the vehicle. Thus, such an owner would be vicariously liable for the tort committed by its employee during the course of his employment.

ii) But in the present case, as per the #agreement between the bus owner and the UPSRTC, the bus owner or the insurance company had the liability to pay compensation for any fault, #negligence or accident by the bus driver. Thus, the 3-Judge Bench of the Apex Court held the Insurance Company liable to pay compensation based on the income of the bus driver.

2) In Chandrakanta Tiwari Vs New India Assurance Company Ltd. and Anr. dated 08-06-2020:

In this case, the Claimant-Appellant’s 28-year-old son, who was a pillion rider, died in a motor accident due to the rash and negligent driving of Respondent No. 2, who was the owner and the driver of the said ill-fated motor vehicle. The MACT held the Insurance Company liable to pay compensation to the Appellant. The said order of the MACT was set aside and the Petition under Section 163A of the Act was dismissed by the Uttarakhand High Court on the ground that the deceased himself was driving the vehicle and had no valid driving license. Thus, the Appellant filed an appeal before the Supreme Court. The 3-Judge Bench of the Apex Court observed and held that:

i) That the Petition under Section 163A of the Act is a ‘no-fault’ petition, where, the claimant need not plead and prove that the rash and negligent act of the driver of the vehicle or of any other person caused the death of a person. In such a petition, the owner of the vehicle or the authorised insurer would be legally liable to pay the compensation.

ii) Thus, the Supreme Court did not take into consideration any argument relating to who was driving the vehicle rashly and negligently at the time of the accident, i.e. whether the owner or any third party, as it was a Section 163A Petition. Further, the 3-Judge Bench held the Insurance Company liable to pay compensation to the Claimant-Appellant based on the age and income of the deceased at the time of the accident.

3) In Sri Anthony Vs Managing Director, K.S.R.T.C dated 10-06-2020:

In this case, the 45-year-old Appellant was travelling in a bus of the Respondent-KSRTC, when he met with an accident due to the rash and negligent driving by the bus driver. As a result, the Appellant suffered serious injuries and his left leg had to be amputated. The MACT awarded compensation to the Appellant, which was enhanced by the High Court in an appeal by the Respondent. Aggrieved by the amount of compensation awarded to the Appellant, he filed an appeal in the Supreme Court. The 3-Judge Bench of the Apex Court observed and held that:

i) That the Appellant had suffered permanent disabilities due to the rash and negligent driving by the bus driver. He could not stand independently or walk without aid of a helper, or climb up and down a staircase, do painting, or any other manual work, etc. his injuries triggered infection in his leg which emanated foul smell that prevented him from socialising in public.

ii) That the Appellant would require at least three additional replacements of the artificial limb in his lifetime.

iii) That the Appellant had lost his job and earnings. Thus, the #permanentdisability had a huge adverse impact on the earning capacity of the Appellant.

iv) Thus, based on what activities he could undertake and what he could not due to the permanent disabilities; his age and nature of work before the accident; and whether he was capable of earning livelihood despite the permanent disabilities, the 3-Judge Bench of the Apex Court enhanced the compensation payable by the Respondent to the Appellant, under various heads, including ‘pain and sufferings’, ‘medical expenses’, ‘attendant charges’, ‘loss of earnings during the treatment period’, ‘conveyance charges’, ‘loss of future earnings due to permanent disability’, ‘future medical expenses’, and ‘loss of amenities’.

4) In M.H. Uma Maheshwari and Ors. vs United India Insurance Co. Ltd. and Anr. dated 12-06-2020:

In this case, the 50-year-old husband of the Appellant No. 1 and father of the Appellant Nos. 2 and 3 was travelling in a car when he met with an accident due to the rash and negligent driving by the driver of the said car. Thereafter, he succumbed to his injuries. The MACT allowed compensation to the Appellants, which was reduced by the High Court in an appeal by the Respondent. Thus, the Appellants filed an appeal before the Apex Court. The 3-Judge Bench of the Supreme Court observed and held that:

i) That the deceased was a 50-year-old man and his untimely death has resulted in loss of dependency to his family.

ii) Therefore, the 3-Judge Bench of the Apex Court upheld the compensation allowed by the MACT under the heads of loss of dependency, loss of consortium, loss of love and affection, transportation of dead body and funeral expenses, based on the age and income of the deceased.

Thus, the Supreme Court has by far allowed compensation to the victims or the families of the deceased victims based on the age, income and nature of work of the victim, impact of accident on the life and earning capacity of the victim or the family of the deceased and other facts and circumstances.

By

Harini Daliparthy

Senior Legal Associate

The Indian Lawyer

Edited by

Sushila Ram Varma

Chief Consultant

The Indian Lawyer

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