Allowed

Sri Syed Samiulla v. Smt Priya G

Karnataka HC9 Dec 2020MFA/6692/2018

Case brief

AI extract

What is this about?

The High Court allowed an owner-driver's challenge to a Motor Accident Claims Tribunal award. It held that the insurer cannot deny liability merely because the driver's license was fake, as the owner had no knowledge and exercised due diligence by verifying the license on its face. The court reinstated the insurer's joint liability with the owner and modified the interest rate.

What did the court decide?

The appeal is allowed; the liability of the owner is set aside; the Insurance Company is directed to pay the award within 90 days; interest modified to 6% p.a.

Sri Syed Samiulla Vs Smt Priya G — Contract and Commercial Disputes | Karnataka HC (2020)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 09^TH DAY OF DECEMBER, 2020

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PRESENT

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THE HON'BLE MRS. JUSTICE S.SUJATHA

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AND

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THE HON’BLE MR. JUSTICE SACHIN SHANKAR MAGADUM

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MFA.NO.6692 OF 2018 (MV-D)

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BETWEEN:

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SRI SYED SAMIULLA AGED ABOUT 43 YEARS S/O. SYED MAHABOOB M/S D B TRANSPORT NO. 46, OPP. SAIL STOCK YARD RAMAMURTHY NAGAR MAIN ROAD BENGLUARU-560 043

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....APPELLANT

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(BY SRI. A.K. BHAT, ADVOCATE)

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AND:

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1 . SMT PRIYA G AGED ABOUT 30 YEARS W/O. LATE. GOVARDHAN

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2 . MASTER. PAVAN G AGED ABOUT 15 YEARS S/O. LATE. GOVARDHAN

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3 . BABY G SUBHIKASHA AGED ABOUT 7 YEARS

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D/O. LATE. GOVARDHAN

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4 . SRI. G VINAYAKA AGED ABOUT 58 YEARS S/O. GANESH @ GANESH ACHARI

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5 . SMT. V SUMATHI AGED ABOUT 50 YEARS W/O. G VINAYAKA

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ALL ARE RESIDING AT NO.217, AMBEDKAR NAGAR CHIKKA BEGUR GATE BOMMANAHALLI BENGLAURU-560 068

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(SINCE 2^ND AND 3^RD RESPONDENT MINOR REPRESENTED BY MOTHER R1)

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….RESPONDENTS

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(BY SRI. A.R. LAKSHMINARAYANA, ADVOCATE FOR R6 SMT. L. TRIVENI, ADVOCATE FOR R4, SRI. CHANDAN .K, ADVOCATE FOR R1, NOTICE TO R2, R3 AND R5)

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THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED: 17.10.2016 PASSED IN MVC NO.4310/2014 ON THE FILE OF THE MEMBER, PRINCIPAL MACT, BENGALURU, AWARDING COMPENSATION OF RS.18,80,944/- WITH INTEREST AT 9 PERCENT P.A. FROM THE DATE OF PETITION TILL REALIZATION.

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THIS APPEAL COMING ON FOR HEARING - INTERLOCUTORY APPLICATION THIS DAY, SACHIN SHANKAR MAGADUM J., DELIVERED THE FOLLOWING:

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JUDGMENT

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The captioned appeal is filed by the appellant-owner

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of the offending vehicle challenging the judgment and award dated 17.10.2016 passed in MVC No.4310/2014 by the Principal Judge, Court of Small Causes and MACT, Bengaluru.

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The brief facts leading to the case are as

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under:

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Respondent Nos.1 to 5 - claimants filed a claim petition by contending that on 28.05.2014 at about 12.45 p.m., the husband of respondent No.1 - claimant No.1 namely Govardhan was proceeding on his bike along with pillion rider namely Gopala. Respondent Nos.1 to 5 - claimants further contended that when Govardhan reached near Nandini Toyota Show Room at G.B.Palya the offending lorry bearing Reg. No.NL-01/A-2687 loaded with iron pieces was negligently parked on the road. The husband of respondent No.1 who had no occasion to anticipate the parking of the vehicle on the road dashed

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against the parked offending lorry and succumbed injuries on the spot and hence, respondent Nos.1 to 5-claimants filed a claim petition claiming compensation of Rs.20,00,000/- along with interest at 12% p.a.

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Respondent No.6 - Insurance Company on receipt of notice contested the proceedings by filing the written statement. Respondent No.6 - Insurance Company specifically contended that the driver of the trailer lorry was driving the same cautiously and carefully and there was absolutely no negligence on the part of the driver of the offending lorry. It was specifically contended in the written statement that the accident if at all was due to sole negligence on the part of the deceased himself who crushed hind side of trailer lorry. Respondent No.6 - Insurance Company has also specifically contended that the driver of the offending lorry possessed a fake driving licence and there is a breach of policy condition. On these set of defence, respondent No.6 - Insurance Company prayed for dismissal of the claim petition.

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The Tribunal based on the pleadings formulated

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the following issues:

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1. Whether the petitioners prove that the deceased succumbed to injuries in a Motor Vehicle Accident that occurred on 28.05.2014 at about 12.45 p.m., on G.B.Palya, near Nandini Toyota Show Room within the jurisdiction of Madiwala Traffic Police Station on account of rash and negligent driving of the Trailer Lorry bearing registration No.NL.01/A.2687 by its driver?

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2. Whether the respondents prove that the accident occurred on account off negligent act of the deceased?

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3. Whether the petitioners are entitled for compensation? If so, how much and from whom?

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4. What order?

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Respondents - claimants in support of their

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contention, examined widow of the deceased as P.W.2 and relied on documentary evidence vide Exs.P.1 to 26. Respondent No.6 - Insurance Company examined two witnesses as R.Ws.1 and 2 and relied on rebuttal documentary evidence vide Exs.R.1 to 11.

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The Tribunal having assessed oral and documentary evidence on record answered Issue No.1 in the affirmative and has awarded compensation of Rs.18,80,944/-. The Tribunal while examining the liability has perused the evidence of R.W.2, who is the Superintendent in ARTO, Chennai West. The said official has stated in his ocular evidence that the licence number had, in fact, belonged to one Gunashekaran M and accordingly, the said driving licence is issued in favour of Gunashekaran M. He has also stated that no driving licence is issued in favour of Suresh who is the driver of the offending lorry in question. The Tribunal having perused Exs.R.10 and R.11 which are letter and copy of the driving licence admittedly issued to one Gunashekaran M coupled with ocular evidence of R.W.2 has come to a conclusion that respondent No.6 - Insurance Company has successfully established that the driver of the offending vehicle did not possess a valid and effective driving licence at the time of accident. Therefore, there is a fundamental breach of policy condition and thereby, respondent No.6 -

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Insurance Company is not liable to indemnify the owner of the offending vehicle. On these set of reasonings, the Tribunal proceeded to hold that the owner of the offending vehicle i.e., respondent No.2 who is the appellant herein alone has to satisfy the award determined by the Tribunal.

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The learned counsel appearing for the appellantowner would vehemently argue and contend before this Court that the Tribunal has not examined proviso to Section 19 of the Motor Vehicles Act, which specifically empowers the licensing authority to adjudicate upon the genuineness or otherwise of the disputed driving licence. Relying on Section 19 of the Motor Vehicles Act, he would submit to this Court that the Superintendent of the Regional Transport Authority was not competent to speak about the genuineness of the driving licence. He would submit to this Court that unless there is an adjudication in regard to the genuineness and authenticity of the driving licence, the ocular evidence of the Superintendent of Regional Transport would not in itself establish that the

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driving licence possessed by the driver of the offending lorry is fake. Learned counsel would further contend before this Court that even if the driving licence is held to be fake, respondent No.6-Insurance Company is still liable to indemnify the owner.

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To buttress his arguments, the learned counsel would rely on the judgment rendered by the Hon'ble Apex Court in the case of NIRMALA KOTHARI VS. UNITED INDIA INSURANCE CO. LTD in CIVIL APPEAL NOS.1999-2000/2020 and would submit that if the owner of the vehicle employees a driver after verifying the driving licence, no fault can be attributed to the owner of the vehicle. He would submit to this Court that an employer is expected to verify the driving licence and in the instant case, it is not the case of the Insurance Company that the owner of the vehicle knew that it is a fake licence, inspite of that, he employed the driver. In the absence of such knowledge and reckless entrustment of vehicle, the Insurance Company cannot raise a defence

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seeking exoneration of liability and such a defence is not available under Section 149(2)(a)(ii) of Motor Vehicles Act.

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Per contra , learned counsel appearing for respondent No.6 - Insurance Company would vehemently argue and contend before this Court that the respondent No.6 - Insurance Company has succeeded in establishing that the licence possessed by the driver of the offending vehicle is fake one. The Tribunal has rightly come to a conclusion that there is a fundamental breach of policy condition and thereby, has rightly exonerated the Insurance Company from indemnifying the owner of the vehicle. On these set of grounds, he would submit to this Court that the judgment and award passed by the Tribunal dismissing the claim petition against respondent No.6Insurance Company does not suffer from any infirmities and the appeal is liable to be dismissed.

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Heard the learned counsel appearing for the appellant-owner and learned counsel appearing for respondent No.6 - Insurance Company. We have perused

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the pleadings of the parties. We have re-assessed the entire oral and documentary evidence available on record.

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Respondent No.6 - Insurance Company has raised a specific defence in regard to driver of the offending lorry possessing a fake licence. The relevant pleadings are culled out as under;

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"7(a). This respondent submits that driver of lorry bearing registration No.NL-01-A2687 did not hold valid and effective driving licence on the date of accident. After investigation, this respondent was able to procure copy of Driving Licence, based on the said information revealed from the police documents that the accused driver had a fake licence. A copy of the letter dated 13.04.2016 addressed by the respondent No.1 to the Public Information Officer, RTO, Chennai is herewith enclosed as document No.1. The perusal of the said letter and the reply/endorsement issued by the Asst. Licencing Authority, Chennai, clearly mentioned that the Driving Licence is a fake one. Under these circumstances, the driver of the indemnify the

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insured under the terms and conditions of the policy. In other words no liability could be fastened on the first respondent under any circumstances of the case. other hand for the reasons stated above the liability if any, has to be fixed only on the owner of the vehicle."

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On perusal of these pleadings, what emerges is that respondent No.6 - Insurance Company has specifically contended that the driver of the offending lorry had a fake licence. On meticulously reading of para No.7 of written statement, it is clearly evident that there is absolutely no allegation against the owner of the lorry involved in the accident. It is not the case of respondent No.6 - Insurance Company that the appellant - owner of the vehicle involved in the accident had knowledge that the licence furnished by the driver of the offending vehicle was a fake licence. If the owner of the vehicle had no knowledge and if there is no reckless entrustment of vehicle to a driver who possessed a fake licence, then we are of the view that the defence by the Insurance Company that there is a breach of policy condition cannot be accepted. The Hon'ble Apex

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Court in Nirmala Kothari's case (cited supra) has held that while hiring a driver the employer is expected to verify if the driver has a driving licence. If the driver produces a licence which on the face of it looks genuine, the employer is not expected to further investigate into the authenticity of the licence unless there is cause to believe otherwise. In the present case on hand, there are absolutely no materials on record to indicate that the owner of the offending vehicle had an occasion to further investigate in regard to authenticity of the licence. The material on record would only indicate that on production of driving licence, the appellant - owner presuming it to be a genuine has employed the driver. In that view of the matter, merely because the driving licence possessed by the driver of the offending vehicle was a fake licence would not in itself constitute a fundamental breach of policy condition and thereby, exonerate the Insurance Company from indemnifying the owner of the offending vehicle. The judgment cited by the learned counsel appearing for

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appellant - owner is squarely applicable to the present case on hand.

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For the foregoing reasons, the finding recorded by the Tribunal on liability is not sustainable. In view of the above conclusion arrived at by this Court, we hold that the finding of the Tribunal in exonerating the liability of respondent No.6 - Insurance Company is palpably erroneous and contrary to the principles laid down by the Hon'ble Apex in Nirmala Kothari's case (cited supra). Accordingly, the finding is set-aside. The appellant-owner and respondent No.6-Insurance Company are jointly and severally held liable to pay the compensation determined by the Tribunal in MVC No.4310/2014.

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For the foregoing reasons, we pass the

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ORDER

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i) The appeal is allowed. ii) The liability fastened on the appellantowner of the vehicle is set aside.

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iii) The Insurance Company - respondent No.6 is directed to satisfy the award within a period of 90 days from the date of receipt of the certified copy of the judgment and order.

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iv) The rate of interest awarded by the Tribunal is modified to 6% p.a. instead of 9% p.a.

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v) The order of the Tribunal insofar as quantum of compensation remains undisturbed.

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vi) Draw modified award accordingly. vii) The Registry shall transfer the amount in deposit along with the original records to the jurisdictional Tribunal forthwith.

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viii) All pending I.As., if any, stand disposed of.

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Sd/JUDGE

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Sd/JUDGE

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NBM

Sri Syed Samiulla v. Smt Priya G

Case brief

What is this about?

What did the court decide?

Sri Syed Samiulla v. Smt Priya G

Case brief

What is this about?

What did the court decide?

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