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2024 Supreme(Mad) 1583
IN THE HIGH COURT OF JUDICATURE AT MADRAS
R. SUBRAMANIAN, R. SAKTHIVEL, JJ.
Rajathi & Ors.- Appellants
Versus
M.J. Vageese & Ors. - Respondents
C.M.A. No. 865 of 2022
Decided On : 12-07-2024
For the Appellants : Mr. M. Sivakumar.
For the Respondents: Mr. S. Dhakshinamoorthy.
IMPORTANT POINT
Insurance companies cannot evade liability to third-party claimants due to breaches of policy conditions by the insured, as established under the Motor Vehicles Act.
Headnote:
Liability - Motor Accident Claims - Motor Vehicles Act, 1988 - Sections 146, 147, 149 - The court emphasized that a breach of policy conditions by the insured does not absolve the insurer from liability to third parties, affirming the statutory rights of claimants under the Act.
Fact of the Case:
The claimants appealed against the Tribunal's decision exonerating the Insurance Company from liability for a fatal motor accident caused by a minor riding a motorcycle without a license, which resulted in the death of the deceased.
Finding of the Court:
The court found that the Tribunal incorrectly applied a split multiplier for compensation calculation and wrongly exonerated the Insurance Company, emphasizing that the insurer remains liable to third parties despite policy breaches by the insured.
Issues: Whether the Tribunal was correct in applying a split multiplier and in exonerating the Insurance Company from liability.
Ratio Decidendi: The application of a split multiplier is improper as per Supreme Court precedents, and the Insurance Company cannot avoid liability to third parties due to breaches of policy conditions by the insured.
Result: The appeal is partly allowed, modifying the compensation to Rs.45,06,000, with the Insurance Company liable to pay.
JUDGMENT :
R. Subramanian, J.
[PRAYER: Civil Miscellaneous Appeal filed under Section 173 of the Motor Vehicles Act, 1988, against the decree and judgment dated 20.09.2021 made in MCOP.No.149 of 2018 on the file of the Motor Accident Claims Tribunal, II-Additional District and Sessions Court, Poonamallee, Thiruvallur District.]
The claimants in MCOP.No.149 of 2018 are on appeal, aggrieved by the exoneration of the Insurance Company from the liability by the Tribunal. The said original petition was filed by the claimants seeking compensation for the death of one Jaffar Ali who died in a motor accident that occurred on 10.04.2018 at about 08.00 a.m.
2. It is the case of the claimants that the deceased was walking cautiously on the Ambattur to Oragadam Gandhi Main Road, from South to North, while he was going near the Government Primary Health Center, Oragadam, the motor cycle bearing Registration No.TN-13-J-6463 ridden by his rider in a rash and negligent manner came from behind and hit the deceased. As a result of which, the deceased sustained multiple injuries and died on 11.04.2018 at the Billroth Hospital, Chennai.
3. Terming negligence on the part of the rider of the motor cycle, the claimants sought for compensation of Rs.60,03,000/-. The claimants sought to justify the quantum by contending that the deceased was earning a sum of Rs.45,000/- per month and due to his death, the family has lost its sole bread winner and hence, the claimants are entitled to compensation of Rs.60,03,000/-. Contending that the vehicle which was cause for the accident namely, TN-13-J-6463 was insured with the 2nd respondent / Insurance Company and as such, the Insurance Company is liable to pay the compensation.
4. As usual, the owner of the motor cycle namely, 1st respondent / the Insured remained ex-parte. The 2nd respondent / Insurance Company resisted the claim contending that the accident did not occur due to the rash and negligent driving of the rider of the motor cycle, but was due to the fact that the deceased crossed the road all of a sudden which resulted in the accident. It was also claimed that the First Information Report as a fabricated document and no criminal prosecution was lodged. It was also contended that the rider of the motor cycle at the time of the accident, V. Byju, son of the 1st respondent aged only about 14 years and he was not qualified to obtain a driving license. Since the vehicle was driven by a person without a driving license, the Insurance Company is not liable to pay the compensation.
5. At trial, the 1st petitioner was examined as P.W.1 and two other witnesses namely, an eye-witness and the Additional Executive Officer of the employer of the deceased were examined as P.W.2 & P.W.3. Exs.P1 to P33 were marked. On the side of the respondents, one C. Munusamy, Inspector of Police, Poonamallee Traffic Investigation was examined as R.W.1 and Exs.R1 & R2 were marked.
6. On the evidence available, the Tribunal concluded that the accident occurred due to the rash and negligent driving of the rider of the motor cycle. The Tribunal, accepted the evidence of P.W.2, an eye-witness, and the contents of the First Information Report in that regard. On the entitlement of the claimants to compensation, the Tribunal concluded that the deceased was drawing a sum of Rs.45,000/- per month, since he was aged about 54 years and he was due to retire at the age of 58 years, the Tribunal applied split multiplier and adopted a multiplicand of 45 months. Thus, the Tribunal fixed the total income at Rs.20,25,000/-. It adopted future prospects at 15%, in view of the age of the deceased and calculated the total loss of dependency before superannuation at Rs.23,28,750/-. After superannuation, the Tribunal took the monthly income at Rs.10,000/-, added 10% towards future prospects, deducted 1/3rd towards personal expenses and applied a multiplier of 9. Thus, it calculated the loss of dependency after superannuation at Rs.7,91,964/-. Adding the loss of
