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2012 DIGILAW 2467 (MAD)

Thilagavathi v. Vellivel

2012-06-15

P.DEVADASS

body2012
JUDGMENT:- 1. The claimant in a fatal accident case, aggrieved with the exoneration of the Insurance Company as well as the quantum of compensation amount, directed this appeal. 2. Admittedly, on 24.04.2006, the father of the appellant died in a road accident, in which the vehicle of the first respondent, insured with the second respondent has been involved. Admittedly, at the time of accident, the first respondent's driver had driven the Tata Lorry. The deceased died at the age of 68. The Tribunal took Rs.80/- per day as wage, deducted 1/3rd from it and calculated the compensation at Rs.96,000/-and added Rs.10,000/- towards loss of love and affection and Rs.7,000/- towards cremation expenses. Thus, the total compensation was arrived at Rs.1,13,000/-. 3. The Tribunal coming to the conclusion that the driver of the first respondent was at that time was not duly licensed to drive that particular class of vehicle, there is policy violation, exempted the Insurance Company from paying the compensation amount to the appellant and directed the vehicle owner/first respondent to pay the compensation amount. 4. Learned counsel for the claimant would submit that so far as the deceased is concerned, he is a third party. Further, even as per minimum wages, the deceased would have earned more. But, very low amount has been taken as daily wages. In the circumstances, the award amount is required to be increased and further, the Insurance Company should not be allowed to avoid its liability to pay the compensation amount under the Insurance policy. At any rate, the Insurance Company is directed to pay and recover the amount from the owner of the offending vehicle. 5. On the other hand, the learned counsel for the Insurance Company contended that the driver of the vehicle was not at all permitted to drive the particular type of vehicle involved in this accident. The Official from RTO has also been examined and through him, the endorsement was also marked. 6. Further, the learned counsel for the Insurance Company contended that under the award, the vehicle owner has been directed to pay. The exempting from payment of the compensation will affect the vehicle owner and thus he is the aggrieved person to plead for issuance of direction to pay and recover. But, he has not appealed. 7. The contentions are two fold. The exempting from payment of the compensation will affect the vehicle owner and thus he is the aggrieved person to plead for issuance of direction to pay and recover. But, he has not appealed. 7. The contentions are two fold. One is quantum of compensation awarded and the other one is liability of the insurer to pay the compensation amount to the claimant on behalf of the insured. We shall see them one by one. 8. The Tribunal ascertained that the deceased was then 68 years old. It is stated that he was employed as a manual labourer in a Mill. The Tribunal taken Rs.80/- per day as his wages. The learned counsel for the claimant would contend that even applying the minimum wages standard, it would be a minimum of Rs.100/- per day. 9. Now, in this case, the deceased was a male. No doubt, he was at an advanced age, considering the fact that he was engaged as a manual labourer and taking into account the then prevailing circumstances as well as the minimum wages, he would have earned a minimum of Rs.100/- per day. Ultimately, the hypothetical income per month would be Rs.3,000/-. Out of that, 1/3rd towards his pleasure and other expenses have to be deducted, the balance would be Rs.24,000/-per annum. The multiplier is 5. Now, calculating on the above lines, the loss of dependency comes to Rs.1,20,000/-(Rs.24,000/- x 5). In other respects, as regards quantum, we are not interfering with the award of the Tribunal. 10. At one point of time, on the ground of driver of the offending vehicle either not possessing the driving licence or possessing a fake driving licence or possessing learners' licence, the Insurance Companies were allowed to go without paying any money under the policy to the affected persons, since there was violation of terms and conditions of the policy. Ultimately, the sufferers are the road accident victims and their dependents. This has been realised by the Courts. A compulsory scheme of Insurance has been conceived under the Motor Vehicles Act, 1988. The Motor Vehicles Act, 1988 is a piece of welfare legislation security measure intended to cover certain unforeseen circumstances met by road accident victims. A statutory liability has been created under Motor Vehicles Act. No vehicle shall be allowed to ply on the public road without Insurance coverage. The Motor Vehicles Act, 1988 is a piece of welfare legislation security measure intended to cover certain unforeseen circumstances met by road accident victims. A statutory liability has been created under Motor Vehicles Act. No vehicle shall be allowed to ply on the public road without Insurance coverage. The idea being to cover the risk to pay the compensation amount to the road accident victims on behalf of the vehicle owners/insured. A contract of insurance is a bipartite agreement between the vehicle owner/insured and the insurer/company. An innocent road accident victim is a third party. To compensate them the Act devised compulsory Insurance. Now, giving this trend of interpretation to the Act, the Courts have started protecting the interests of the third parties. So, at the time of accident when the insurance policy is in force, the Insurance Companies were directed to pay the amount to such third parties and recover it from the owner of the offending vehicle. But, when there is no Insurance at all, such a direction cannot be given. Because, when there is no liability to pay on the part of the Insurance Company, Courts cannot compel the Insurance Company to pay the compensation amount. 11. In ICICI LOMBARD GENERAL INSURANCE COMPANY LIMITED Vs. ANNAKILI [2012 [1] TN MAC 296], this Court held as under:- “ 196. Assailing the correctness of the finding, fastening liability on the Appellant-Insurance Company to pay compensation, Mr. C. Ramesh Babu, learned counsel for the Appellant-Insurance Company, submitted that when admittedly, the Claims Tribunal found that the driver of the Auto Rickshaw had no licence to drive the same on the date of accident, it should be construed that there was a clear breach of terms and conditions on the part of the owner of the vehicle and in such circumstances, the owner of the vehicle alone ought to have been made liable to pay compensation to the Respondents/Claimants. He further submitted that by letting in evidence through RW3, a Junior Assistant from the office of the Motor Vehicle Inspector and marking Ex.R10-Licence, issued to the driver to drive Motorcycle and Car, only on 29.10.2009, much later in point of time, than the date of accident i.e., 13.6.2009, the Insurer has discharged its burden of proof that there was a clear breach of terms and conditions on the part of the owner and therefore, the Company cannot be mulcted with any liability to pay compensation to the Respondents/Claimants and on the other hand, there should have been a total exoneration. The submission cannot be accepted for the reason that even if the breach is proved, the Insurance Company is liable to pay compensation to a third party victim and recover the same from the owner, which right has already been given by the insured. Hence, no interference is called for." 12. The ratio of the said decision as well as the several decisions on the point are to the effect that so far as the third party is concerned, at the time of accident when there is policy coverage, the Insurance Company could be directed to pay the amount to the claimants and recover it from the owner of the offending vehicle. 13. No doubt, in this case, the owner of the vehicle will be an aggrieved person because under the award he alone has been directed to pay the compensation amount to the appellant. In truth and in practice, the claimant will be the real aggrieved party. It is not an uncommon event for a claimant finding it difficult to collect a single paise from the owner of the offending vehicle under the award. It will remain in his hands a paper award. This is also one of the reason for issuing pay and recover order. So, in that view of the matter, the claimant will be the real aggrieved party. 14. Now, in the facts and circumstances, analysing the facts of the case as well as the position of law, I am of the view that the Insurance Company shall be directed to pay the compensation amount to the appellant and recover it from the owner of the offending vehicle. 15. In the result, the appeal is allowed in part. The award amount is modified. 15. In the result, the appeal is allowed in part. The award amount is modified. Rs.1,37,000/- with interest @ 7.5% p.a., from the date of original petition till deposit is awarded. The second respondent shall deposit the entire compensation amount within 4 weeks from the date of receipt of a copy of this judgment, less the amount, if any already deposited. On such deposit, the claimant is permitted to withdraw the compensation amount with accrued interest, less the amount, if any already withdrawn. Based on the directions in this Judgment itself, the second respondent can initiate execution proceedings as against first respondent and recover the said amount including cost of the proceedings throughout by filing appropriate proceedings before the concerned Execution Court. For this purpose, it need not file a separate suit. No costs.