Insurers must prove willful policy breach to avoid liability; the value of a housewife's services can significantly affect compensation.

1. The Appellants impugn a judgment dated 01.08.2011 passed by the Motor Accident Claims Tribunal (the Claims Tribunal) whereby a compensation of Rs.3,57,500/- was awarded for the death of Haridwari Devi @ Harduri who died in a motor vehicle accident which occurred on 13.10.2008.

2. In the absence of any Appeal by the driver, owner or the Insurer, the finding on negligence has attained finality between the parties.

3. While computing loss of dependency, the Claims Tribunal held that Smt. Hardwari Devi was working as a housewife; the value of the gratuitous services rendered by her was taken to be Rs.3,000/- per month; deduction of one - fourth was made towards expenses as the number of dependents were seven and thus, a sum of Rs.2,92,500/- was awarded towards loss of gratuitous services to the Appellants and a compensation of Rs.65,000/- was awarded under non - pecuniary heads.

4. There is twin challenge to the judgment. Firstly, it is urged that the compensation awarded is very low. The Claims Tribunal did not properly assess the value of the gratuitous services rendered by the deceased housewife. Secondly, it is contended that the vehicle was duly insured, yet, the Claims Tribunal exonerated the Insurance Company on the ground that the Insurance Company had successfully established the breach of the terms of the policy. It is urged that the Respondent Insurance Company failed to prove the willful breach of the terms of policy. Hence, it could not avoid its liability.

5. As far as award of compensation in case of death of a housewife is concerned, the question was dealt with in great detail by me in Royal Sundaram Alliance Insurance Co. Ltd. v. Master Manmeet Singh & Ors. MAC. APP. 590/2011, decided on 30.01.2012.

6. In Master Manmeet Singh this Court noticed following judgments of the Supreme Court: -
(i) General Manager, Kerala State Road Transport Corporation, Trivandrum v. Susamma Thomas (Mrs.) and Ors. 1994 (2) SCC 176 ,
(ii) National Insurance Company Limited v. Deepika & Ors., 2010 (4) ACJ 2221,
(iii) Amar Singh Thukral v. Sandeed Chhatwal, ILR (2004) 2 Del 1,
(iv) Lata Wadhwa & Ors. v. State of Bihar & Ors., 2001 (8) SCC 197,
(v) Gobald Motor Service Ltd. & Anr. v. R.M.K. Veluswami & Ors., AIR 1962 SC 1,
(vi) A. Rajam v. M. Manikya Reddy & Anr., MANU / AP / 0303/1988,
(vii) Morris v. Rigby (1966) 110 Sol Jo 834





and
(viii) Regan v. Williamson 1977 ACJ 331 (QBD England), and laid down the principle for determination of loss of dependency on account of gratuitous services rendered by a housewife. Para 34 of the judgment in Master Manmeet Singh (supra) is extracted hereunder: -
"34. To sum up, the loss of dependency on account of gratuitous services rendered by a housewife shall be: -
(i) Minimum salary of a Graduate where she is a Graduate.
(ii) Minimum salary of a Matriculate where she is a Matriculate.
(iii) Minimum salary of a non - Matriculate in other cases.
(iv) There will be an addition of 25% in the assumed income in (i), (ii) and (iii) where the age of the homemaker is upto 40 years; the increase will be restricted to 15% where her age is above 40 years but less than 50 years; there will not be any addition in the assumed salary where the age is more than 50 years.
(v) When the deceased home maker is above 55 years but less than 60 years; there will be deduction of 25%; and when the deceased home maker is above 60 years there will be deduction of 50% in the assumed income as the services rendered decrease substantially. Normally, the value of gratuitous services rendered will be NIL (unless there is evidence to the contrary) when the home maker is above 65 years.
(vi) If a housewife dies issueles