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Andhra Pradesh High Court
Judges : NEELAM SANJIVA REDDY
R.Kamala - Appellant
Versus
United India Insurance Co.Ltd.rep.by its Divisional Manager, Hyderabad - Respondent
Decided On : 08-19-97
Held : primary liability is that of the insured and the insurer comes into the picture to indemnify the liability of the insured. It is therefore obvious that if the owner has not incurred any liability in respect of death or bodily injury to any person or damage to property of third party, there is no liability to be covered by the insurer. It is quite apparent that in case of payment of compensation on the principle of fault liability , the insurer is bound under the law and the contract of insurance to indemnify the liability of the insured after such liability is fixed in terms of the provisions of Chapter XI of the Motor Vehicles Act, 1988. The liability of the insurer is not independent of that of the insured. Insurer s liability arises only when the liability of the insured is fixed as per the provisions of Chapter XI of the Act.
For assessing the liability of the deceased insured, it is necessary that his estate is represented by his legal representatives or in the absence of any legal representative, State has to be added as a party representing deceased-insured s estate for the reason that if the insured dies intestate leaving no heir, his property devolves on the Government or escheats to the State subject to all the obligations and liabilities of a heir.
There is no dispute about the survival of the cause of action in case of death of the insured as contemplated under Section 102 of Old Act or Section 155 of New act.
The insurer is only bound to indemnify the liability of the insured and satisfy judgment and decree passed against the insured. Therefore, unless the liability of the insured is found, the question of binding the insurer to indemnify the liability of the insured does not arise.
Death of the insured would not affect the contract entered into between the insured and the insure and that the cause of action survives against the estate of the insured or against the insurer.
( 1 ) THE claimant in O. P. No. 32/87 on the file of the Motor Accidents Claims tribunal-cum-District Judge, Ranga Reddy District, preferred this appeal against the order passed on 8-9-1988.
( 2 ) R. Kamala, the claimant, aged about 28 years and working as a teacher on a monthly remuneration of Rs. 1,520/- at Tandur, sustained grievous injuries on 10-9-86 in a motor vehicle accident caused due to rash and negligent driving of the lorry AAA 9720 by its driver. She was admitted in Govt. Hospital at Tandur on 10-9-86 and then referred to Osmania General Hospital, hyderabad for expert treatment. After discharge from Osmania General hospital on 24-9-86, she was again admitted at the Govt. Hospital, Tandur, on the same day and was treated as in-patient till 2-1-87. The crush injury of her right ankle joint extending from the dorsum of the foot to the sole of the foot measuring 12" x 2" x 2" resulted in shortening of foot and its disfigurement and the said permanent disability was assessed at 20% to 25%. She preferred the above claim for a total compensation of Rs. 10,00,000/- from the owner and insurer of the lorry involved in the accident. The claim was resisted. The tribunal, after due enquiry, found that the accident occurred due to rash and negligent driving of the lorry AAA 9720 by its driver and awarded a total compensation of Rs. 53,000/-, with interest at 9% p. a. from the date of petition till payment. The claimant, dissatisfied with the amount of compensation awarded, preferred this appeal for enhancement.
( 3 ) DURING pendency of this appeal, the owner, the first respondent in the appeal died. The appeal as against R-1 was dismissed. The order dated 25-7-97 reads:"the learned Counsel for the appellant represents that in spite of all efforts made, the details of the Legal Representatives of the deceased-1st respondent could not be obtained by him and in the circumstances cma 143 /89 may be treated as having abated against the first respondent i. e. the owner of the vehicle. He relies on a decision of a Division Bench of this Court in Haji Zakaria vs. Naoshir Cama and contends that the appeal does not abate against the Insurance Company - the 2nd respondent. However, that is the matter to be gone into when the appeal comes up for final hearing. CMA shall stand dismissed as against R-1. In the circumstances, office is directed to post this CMA immediately for final hearing before the appropriate Bench hearing the final appeals". Consequent upon the above order, the appeal has been posted for hearing.
( 4 ) THE preliminary question to be answered before proceeding with the merits of the case for enhancement is whether the appeal is maintainable against the insurer-second respondent only without adding legal representatives of the deceased insured, the first respondent, to represent his estate.
( 5 ) MR. Kota Subba Rao, learned Counsel for the appellant submitted that the appellant does not claim any relief as against the estate of the insured and that the appellant presses her claim for enhancement of the compensation as against the insurer only.
( 6 ) MR. M. Srinivasa Rao, learned Counsel for the insurer, submitted that the insurer is liable to satisfy any judgment and decree passed against the insured and that unless and until such judgment and decree is passed against the deceased insured by properly representing the estate of the deceased, the insurer is not bound under the contract and law to pay the enhanced compensation, if any, in this appeal.
( 7 ) SECTION 155 of the Motor Vehicles Act, 1988 (New Act) relates to section 102 of the Motor Vehicles Act, 1939 (Old Act ). It deals with the effect of death on certain causes of action. It runs:"notwithstanding anything contained in Section 306 of the Indian succession Act, 1925 (39 of 1925), the death of a person in whose favour a certificate of insurance had been issued, if it occurs after the happening of an event which has given rise to a claim un
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