High Court of Kerala: In a path-breaking decision a Division Bench comprising of   C .T. Ravikumar and K. P. Jyothindranath, JJ.,while answering a vital question related to State’s liability to indemnify in motor vehicle accident claim cases held that the government is under a welfare State liability to compensate for the death or injury caused to a vehicle owner during an accident as the road tax is levied by the government.

The case relates to a motor vehicle accident claim  where the claimants are the legal heirs of the deceased  pillion rider, who happened to be the owner of the vehicle. The petition was filed  for compensation against the bike rider as well as against the National Insurance Co. Ltd as the vehicle involved in the accident was insured with the abovementioned company. The Tribunal dismissed the claimants’ petition  holding that the deceased was not the third party but the insured  owner and hence the claimants are not entitled to any compensation from the insurance company as they claimed as the insured owner and not as a third party.

The major issue that arose for consideration before the Court was whether there exists any liability on part of the bike rider, which the Court answering in the negative held that there does not exist any tortious liability based on either vicarious or strict liability principle as there exists no relationship between the bike rider and deceased apart from that of entrustment. The claimants are entitled to compensation  in a legal fiction as if stepping into the shoes of the deceased, who being the owner of the vehicle has no right to claim compensation from the bike rider.

The Court further held in relation to the claims moved against the insurance company  involving Sections 140 and 163-A of the Motor Vehicles Act that the claimant will be entitled for compensation irrespective of the fact whether his fault or not, caused the accident, or under the fault liability, only if they are the third party and not the owner-insured as the owner-insured  cannot be regarded as the third party being one of the two parties to the contract of insurance. Perusing the contentions and the relevant material on this point, the Court further opined that if the owner-insured makes a payment of additional premium towards the policy then he is entitled to  claim compensation  before the Tribunal when he sustained a personal injury and thus directed the insurance company to pay Rs.1,00,000 to the claimants, to be apportioned among the claimants in equal shares along with 8% interest from the date of petition till payment.

The Court also made  significant observations  relying on  Manjusri Raha  v. B.L.Gupta (1977) 2 SCC 174 : (1977) 2 SCR 944 and Motor Owners’ Insurance Company Limited v. Jadavji Keshavji Modi, (1981) 4 SCC 660 ( AIR 1981 SC 2059), that the government is responsible to pay compensation to the deceased or the victim’s dependent or the owner of the harmed vehicle as the roads on which the vehicle run are provided and maintained by the government. Considering the increased number of road accidents beyond believable limit the Court pointed out that since the motor vehicle act does not consider the personal injury claim hence under these  circumstances, there will be a welfare state liability on the government, which will partially eclipse the maxim volunti non fit injuria and fault liability theory. Partially allowing the appeal with cost, the Court   stated that  the liability of the government being limited, it can be enforced in cases of accidents occurring on public roads where road tax is levied by the Government. Such compensation can be paid by the government either directly or assign the burden to the insurance companies by statutorily making the company liable. The Court suggested that such a mechanism whereby the government/insurer will be liable  for a fixed sum, as in the case of Section 140 of the Motor Vehicles Act  payable to the owner in case of injury/death, is the need of the day. [L. Mini v. Gireeshkumar, 2016 SCC OnLine Ker 16781, decided on  September 2, 2016]

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