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High Court of Judicature at Madras
THE HONOURABLE MRS. JUSTICE PRABHA SRIDEVAN & THE HONOURABLE MR. JUSTICE K.K. SASIDHARAN
Royal Sundaram Alliance Insurance Co. Ltd., Coimbatore
Versus
A. Meenakshi & Others
C.M.A. No.312 of 2009
Decided on : 04-03-2009
MOTOR VEHICLES ACT - INSURANCE - LIABILITY OF INSURANCE COMPANY - DEATH OF PASSENGERS - LIABILITY OF INSURANCE COMPANY - WHETHER INSURANCE COMPANY IS LIABLE TO PAY COMPENSATION FOR THE DEATH OF PASSENGERS WHO TRAVELLED IN THE CAR AND WHETHER THE INSURANCE POLICY COVERS THE LIABILITY TO A GRATUITOUS PASSENGER - COURT HELD THAT INSURANCE COMPANY IS LIABLE TO PAY COMPENSATION FOR THE DEATH OF PASSENGERS WHO TRAVELLED IN THE CAR AND THE INSURANCE POLICY COVERS THE LIABILITY TO A GRATUITOUS PASSENGER.
Fact of the Case:
The deceased was a passenger in the insured vehicle and on account of the negligence of the driver who was also the owner of the vehicle, an accident occurred on 30.7.2004. The accident resulted in the deaths of the driver and the three passengers. The claimants are the legal heirs of the passenger who died on the spot.
Finding of the Court:
The court held that the insurance company is liable to pay compensation for the death of the passengers who travelled in the car and the insurance policy covers the liability to a gratuitous passenger.
Issues: Whether the insurance company is liable to pay compensation for the death of the passengers who travelled in the car and whether the insurance policy covers the liability to a gratuitous passenger.
Ratio Decidendi: The court held that the insurance company is liable to pay compensation for the death of the passengers who travelled in the car and the insurance policy covers the liability to a gratuitous passenger because: * The deceased was a gratuitous passenger in the insured vehicle. * The Policy is a Package/Comprehensive Policy. * The vehicle is a private car. * Section 95 of the Motor Vehicles Act, 1939 and Section 147 of the Motor Vehicles Act, 1988 provide that a policy of insurance must be a policy which insures the person or classes of persons specified in the policy to the extent specified in sub-section (2) against any liability which may be incurred by him in respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. * The relevant section after the 1988 Act came into force is Section 147, and it reads as follows : "147. Requirements of policies and limits of liability.-(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which -- (a) is issued by a person who is an authorised insurer; and (b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-- (i) against any lliability which may be incurred by him in respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; ... (2) Subject to the proviso to sub-section (1), a policy of insurance referred to in subsection (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely :-- (a) save as provided in clause (b), the amount of liability incurred; (b) in respect of damage to any property of a thirty party, a limit of rupees six thousand: Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. ..." * A reading of the aforesaid terms and conditions discloses that the Insurance Company issued a policy known as "Package Policy" for two wheelers and collected a premium to cover the risk of not only own damage, but also third party. The coverage also included the death or bodily injury to any person including occupants carried in the insured vehicle (provided such occupants are not carried for hire or reward). The terms and conditions of the policy and the schedule of payment cannot but be said to cover claims of the injured pillion rider of the Motor Cycle.
Final Decision: The court dismissed the appeal and confirmed the award of compensation as granted by the Motor Accidents Claims Tribunal.
Prabha Sridevan, J.
The deceased was a passenger in the insured vehicle and on account of the negligence of the driver who was also the owner of the vehicle, an accident occurred on 30.7.2004.
The accident resulted in the deaths of the driver and the three passengers. The driver and two persons died at the hospital, while one passenger died on the spot. The claimants are the legal heirs of the passenger who died on the spot.
2. The legal question that arises for consideration in this appeal is whether the insurance company is liable to pay compensation for the death of the passengers who travelled in the car and whether the insurance policy covers the liability to a gratuitous passenger. We also have to decide what is a just and reasonable compensation for the claimants. According to the claimants they are liable to be compensated in a sum of Rs.25,00,000/-. The insurer has taken the specific point that on payment of additional premium, the insurance policy in this case has been extended to cover personal accident to five unnamed persons for a capital sum insured of Rs.70,000/- each in terms of (India Motor Tariff) IMT.16 and therefore,even if the insurance company is liable its liability is restricted to Rs.70,000/- and nothing more.
3. The Motor Accidents Claims Tribunal was not inclined to accept the case of the insurance company that there was only a limited liability. It awarded a compensation of Rs.19,10,000/-. Against that, this appeal has been filed. We have heard the rival submissions, gone through the copies of the relevant documents.
4. Every case has to be decided according to the facts of the case. The following facts in this case are the basis for our decision :
(a) The deceased was a gratuitous passenger in the insured vehicle.
(b) The Policy is a Package/Comprehensive Policy.
(c) The vehicle is a private car.
In A.I.R. 2002 S.C. 834 [Haryana Financial Corporation vs. Jagdamba Oil Mills], the Supreme Court quoted the following words of Lord Denning in the matter of applying precedents, which have become locus classicus:
"Each case depends on its own facts and a close similarity between one case and another is not enough because even a single significant detail may alter the entire aspect. In deciding such cases, one should avoid the temptation to decide cases (as said by Cardozo) by matching the colour of one case against the colour of another. To decide, therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive."
.. ... ... Precedent should be followed only so far as it marks the path of justice, but you must cut the dead wood and trim off the side branches else you will find yourself lost in thickets and branches. My plea is to keep the path to justice clear of obstructions which could impede it."
These words have subsequently been reiterated by various courts in a number of judgments. So, in a case like this, the decisions which involve an Act Policy, a goods vehicle or a public transport vehicle may be relevant, but they are not binding.
5. Section 95 of the Motor Vehicles Act, 1939 reads as follows :
"95. Requirements of policies and limits of liability.-(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which --
(a) is issued by a person who is an authorised insurer [or by a co-operative society allowed under Section 108 to transact the business of an insurer], and
(b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2) --
(i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
....
(2) Subject to the proviso to sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely --
(a) where the vehic
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